How to Start Trading Bitcoins
Bitcoin trading can be exceptionally lucrative for professionals and beginners alike. The market is fresh, well fragmented with huge spreads. Margin trading and arbitrage are commonly available. So a lot of people can make money by trading bitcoins. Bitcoin’s history of volatility and bubbles has possibly brought in new investors and users than other facets of the cryptocurrency. Every bubble about Bitcoin creates new hype that puts Bitcoin in the spotlight. The media awareness causes more to develop interest thereby making the price to keep rising until the hype dies away. Each time Bitcoin’s price skyrockets, new speculators, and investors will want their share of the profits. If you are attracted in this trading and every time you are thinking about best place to buy bitcoins , there are a lot of online trading companies that are offering this product typically as a deal for difference or CFD.
Bitcoin trading has a very small barrier to entry when compared to other financial instruments because Bitcoin is universal and can easily be sent anywhere there the trading is so simple. Though the first question that pops up when thinking of Bitcoin trading is best place to buy bitcoins but if you own bitcoins already, you can start trading almost immediately, and verification is not even required to start trading in many cases.
Why Trade Bitcoin?
Before we explain how to trade Bitcoin, it’s crucial to appreciate why Bitcoin trading is both unique and exciting. Bitcoin is not fiat currency, so its price isn’t openly related to the financial system or policies of any particular country. All through the history of Bitcoin, the price has reacted to a large range number of events, from Greek capital controls to China’s devaluation of the Yuan. Panic and a wide range of economic uncertainty have been responsible for the rise in Bitcoin price in the past. For instance, it was alleged that Cyprus’s capital controls gave so much attention to Bitcoin and made the price to rise in the bubble of 2013.
Bitcoin Trades 24/7, there are no formal Bitcoin exchanges rather there are a lot of exchanges all over the world that operate round the clock. For the fact that there is no formal Bitcoin exchange, there is no official Bitcoin price. This alone creates arbitrage opportunities even though exchanges stay within a certain price range more often.
Bitcoin is well-known for its frequent and rapid movements in price. By looking at a standard daily chart of major exchanges, it’s common to spot many days with swings of 5% or even more:
One of the early steps to take when planning of Bitcoin Trading is to buy it. You can buy bitcoins from other people through marketplaces or exchanges. Users have a wide range of choices and should put the following factors into consideration when making a decision on an exchange:
Is the exchange reliable? If you want to deposit fiat currency, does the exchange accept payments coming from your country? What percent of every trade is charged as a fee? What liquidity rate does the exchange have?
After sorting the above and you finally settle for an exchange, you can pay them in a range of ways, from credit and debit cards to wire transfers to hard cash, or even with any other cryptocurrencies, depending on where you are and who you are buying from. From this point on, you are already in the business.
Learn More >> What are Bitcoins