Cryptocurrency is gaining prominence, acceptance & interest worldwide now. Even a few big-time investors have started to talk about investing in cryptocurrencies.
It’s now quite favourable to trade in cryptocurrency. There is enough liquidity, acceptance worldwide & established exchanges to make it easy to trade crypto and earn decent, even when you trade sparingly.
I have been into traditional stock market trading & sparingly a commodities trader for more than a decade now. And here are the reasons and benefits that I found when I started my own journey of trading in cryptocurrencies.
- 1 Why trade in cryptocurrency?
- 2 Benefits of Crypto trading
- 3 Additional benefits for advanced traders
- 4 Frequently Asked Questions about Investing and Trading
Why trade in cryptocurrency?
If you search for reasons to invest in cryptocurrencies, you will get a lot of favourable and not so favourable opinions – throughout the internet.
And from what I have understood, the only reason you will decide to invest in cryptocurrency will be:
- You understand and believe in the technology behind cryptocurrency and how it is going to be widely accepted in future.
- You see the benefit of effortlessly moving funds across borders through something as simple as the wallet address. No banking system to cut fee and increase the processing time. A decentralised system & robust by design.
But what if you understand but you don’t believe that much or the price moves that you hear every month makes you uncomfortable.
How to take benefit in that case?
Benefits of Crypto trading
There is an entire list about the benefits of trading in crypto:
No need to research in-depth about investing
You can easily trade in cryptocurrency, without getting your investment tied in any instrument.
Which means you can start trading in cryptocurrencies before you can start investing in them. Though, if you are a beginner, then I would strongly recommend trading only in old established coins rather than any ICO.
Or, if you are already invested in Crypto, like Bitcoin, you can trade to increase your Bitcoins.
Both ways, you can make these price movements work in your favour, rather than against you.
Prices are Volatile
Cryptocurrency prices moves are equally famous as the whole concept of cryptocurrency itself.
It’s very common to see more than 10% move in a single day. Which means for a day trader, it gives multiple opportunities throughout the day to trade in cryptocurrency.
Truly Global Market timings
Most cryptocurrency exchanges are operational round the clock.
That is – 24 hours a day, 7 days a week. You can trade anytime you want to. This provides liquidity round the clock as the transaction is between individuals spread across the globe.
This means wherever you are are across the globe, you can trade in crypto after your day job is over, before your work or even on weekends. You can easily set up alerts and trade when the entry is right.
With wider acceptance and with more and more entering into trading in cryptocurrencies, ample liquidity is there in markets now.
You can easily enter or exit any position you took with minimal slippage.
Additional benefits for advanced traders
If you are already a trader in Forex or stock market, then you will find that trading cryptocurrencies has some additional benefits
Easy margin trading option
Enabling Margin trading in cryptocurrency exchanges is quite easy and fast. You just need to accept the agreement and it’s done.
On top of that, the rate of interest is calculated on hourly basis. Which means if you held a position for 3-4 hours, you pay interest only for that duration.
Regular trading incentives
To increase the trading volume and liquidity, all the leading crypto exchanges hold trading incentives as tournaments.
Most of these tournaments help you to earn extra as prize money. Good additional money on top of profit you made to win the tournament itself.
High Quality Bot trading options
Being technology driven has its own advantages. Bot trading option in Crypto trading is one of them.
Despite being new entrant into trading field itself, Bot trading is quite common in crypto trading.
You can see few high quality bots available for subscription, or you can build your own.
There are quite a few, like 3commas, AI-based bot trading platforms to help you. These platforms are fairly advanced.
Frequently Asked Questions about Investing and Trading
How to invest in Bitcoin Stock?
Bitcoin is not a stock of a company. It is a cryptocurrency. To invest in Bitcoin, you need to buy Bitcoin at a Cryptocurrency exchange and store it in your personal wallet.
You can buy a Bitcoin, using your FIAT currency, from any of the cryptocurrency exchange.
Do you need to invest in Cryptocurrency for trading?
No, you don’t need to invest in cryptocurrency to trade in cryptocurrency.
Most of traders in cryptocurrency, invest in Bitcoin and trade in other coins when they see an opportunity.