The Deal on Cryptocurrency trading
Cryptocurrency is the name given to fully digital currencies that use a system of cryptography, a complex system of coding, for authenticity and security. This is kept going by composite computer files in a large network that holds records of the account values and transactions centered around the use of cryptocurrency, called a Blockchain.
Cryptocurrency, for its use, cannot be summarized so easily, so here’s a bit more information:
The first cryptocurrency that comes to mind is probably Bitcoin. Something that was seen as a simple fad that a few people bought into a few years back that didn’t seem to make any big returns right away until a consistent boom caused their values to skyrocket. Leading just a few bitcoins to be worth hundreds of dollars. However, in this day and age, there are a lot more cryptocurrencies with different attributes and the internet. While Bitcoin has been slowly going down in maximum value thanks to a number to factors, including the rise of new cryptocurrency like Litecoin, Ripple etc., and is prone to wild fluctuation, it is still…at the time of this post at least, really valuable.
The benefit of cryptocurrency is that there’s no third party to run transactions through. It’s you and the other person. There is a system by which privacy is protected through transactions in a user’s online wallet. The lack of third party inclusion also means that there are no extra fees for fund trades and transfers. However, there is also no full authority governing the use of these currencies as many countries do not have many policies with these under clear jurisdiction. Such things cause these currencies to be non-recoverable once information is hacked or the system governing the value is lost without official backup. Secondly, these currencies are often used in shady practices due to the lack of regulation. While more prominent currencies like the aforementioned bitcoin can be traced more easily, you could no doubt find the more private ones floating down places like the Darknet. Because of this, acquisition transactions must be made with a sense of responsibility and adequate security.
In essence, cryptocurrency trading is just an alternate form of real trading. The Bitcoin has a comparative value to some of the other currencies and so the differences caused by the daily market are ripe for profit for forex trades. The same pip rules, and buying and selling systems apply. The benefit of this type of trading is that it can even be done on weekends when the market is normally closed for normal forex trades. There are a few drawbacks though. Not every trading platform allows this kind of trading and some may even ask for extra sign up prerequisites before they allow you to enter the market with a crypto-account. Not only that, but thanks to recent events (at time of post) the cryptocurrency market fluctuations have been getting more intense, and so the value of things like bitcoin is quite volatile. If you are interested in trading cryptocurrency, then make sure you understand the broker you’re aligned with and their policies. Of course, like normal currencies, crypto requires its own research for trading effectiveness, even more so now thanks to its volatility.