Author:Vishal Doshi


Bitcoin Trading and Forex Trading

  • Forex Market is a trading center for different currencies. Bitcoin is a currency in itself. To ease the exchange of finance globally, the government of different countries is developing International Finance Markets. Big multinational companies and organizations also need a source that would ease their financial transactions at the global level.
  • Forex market includes government, commercial institutions, and corporations as traders. There are many traders from all over the world who invest in Forex market with the aim of earning profits, from the differential amount of currency pair.
  • Currency that a trader buys in the Forex Trading Market is known as Base Currency. In Forex trading market the currency rate trend very slowly, whether it's a raise or a downfall. But, in the situations like the financial crisis in the country, change in political party of a country's government or disintegration of the national economy causes a sudden change of either increase or decrease in prices.
  • There are more chances of winning and losing in Forex Trading Market when prices are fluctuating more and more. Here comes the concept of Bitcoin Forex trading. In Bitcoin trading when price rates of commodities speculate a lot, the Bitcoin value will get more volatile. Bitcoin can earn you huge profits as well as incur you big losses too because of its high volatility factor.
  • In Forex trading you buy and sell a currency pair. In Bitcoin trading, you deposit and withdraw your Bitcoins. But, in Forex Bitcoin Trading you have to invest your Bitcoins in particular currency pair for trading. Fluctuation in prices of Forex currencies lets you earn and lose the value of Bitcoin as compared to US Dollars.

Advantages of Bitcoin Forex trading

  • Zero cost of transaction:
    Banks and clearing agencies are not involved in recording transactions of Bitcoin Traders. Transactions of Bitcoin trade are recorded digitally on public networks. Global transfers are not liable for transaction costs in Bitcoin trading. Trade profits also improve because brokers do not charge deposit and withdrawal fees for their client's benefits.
  • No Centralized Valuation:
    Central Banks do not alter Bitcoin values. Bitcoin valuation is not affected by changes in factors of macroeconomics and geopolitics.
  • Leverage Ratio is comparatively higher:
    In Bitcoin trading, brokers provide leverage of 1:1000 ranges to attract investors. But, it is equally risky during downfalls because the proportion of loss is also high with high leverage range.
  • Deposit amount is low:
    Some Bitcoin Forex trading brokers ask for only $25 to initiate a trade. Brokers also offer matching deposit amount for promotions.
  • The cost of trading is low:
    Bitcoin Forex Brokers take the very low trading cost to allure more and more investors.
  • Security is intact:
    You don't need to give your details of banking or credit cards in Bitcoin Forex Trading. Hence, you need not worry about the security of your money even when you are dealing with foreign brokers.
  • Global boundaries are not a concern anymore:
    There no global boundaries for traders of Bitcoins. Only concern is the regulations of the countries trading.

Threats of Bitcoin Forex trading

Various exchanges work in dealing of Bitcoins. So it is difficult for traders to choose the best one. A trader must find an appropriate exchange dealing in Forex Bitcoin as per his or her expectations. Exchange rates differ in different exchanges.Brokers immediately sell the Bitcoins for US Dollars as soon as they receive them from their traders and traders are revealing the Bitcoin to US Dollars rate risk from deposit to withdrawal.High volatility is the riskiest factor causing a disadvantage for traders by unregulated brokers in Bitcoin Forex trading. The broker's digital wallet does not provide security against hackers causing risk of theft. But, there brokers having insurance protection against hacking. A trader should give preference to such brokers for the safety of his money.

Following Brokers allow Forex Bitcoin trading despite many companies' disallowance

They provide CFD (Contract for Difference) services. Your capital is at a huge risk while trading with CFDs. 10Markets Trade360° AVATRADE
1 broker BCapitalsFx Evolve Markets Ltd. Caesar Trade InstaForex Group FX Open Markets Limited Nova FX Trading
Just Forex SimpleFx SunbirdFx ProfitForex
SuperForex ZARFX Whaleclub TTCM Traders- Trust Capital Markets
eTORO Fx Choice VenetFx Forex-Metal
FxOpen FxPRIMUS LiteForex Trader's Trust
Trader's Way Belfrics Kraken
Coinsetter CEX.IO BTC-e

CFD v/s Forex

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Distinguish between Forex and CFD

Spot forex or forex CFD

The meaning of Spot Forex:

Spot Forex is purchase and sale of a currency pair at existing rate in the forex market including cash transactions without any interest charges. Spot Forex[2] is unregulated in USA and UK. CFD offer more commodities for trade than commodities in Spot Forex. Spot Forex offers leverage in ratio. For example, 1:100 or 1:10, whereas CFD provides 1% or 5% fixed margin. CFD is working overnight. So it charges financing costs. This finance cost includes daily charge according to the size of the contract. Financing costs of CFD are mostly in link with benchmark rates of Central banks. Traders have to spend a huge amount of your earned money, like interest rate, if their trade is open for a longer period in CFD. Spot Forex offers Demo account that helps you to practice before investing your money. CFD does not offer such Demo accounts, and traders remain unfamiliar with the concept.

List of CFD brokers with unlimited demo account

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Exchange-traded fund (ETF)

ETF is an investment Fund. ETF trading is similar to that of stocks. Stock exchange does trading of ETF. ETF includes stocks, bonds, and commodities. During a trading day, ETF trading takes place in Net Asset Value.ETF has characteristics of unit investment trust as well as mutual funds. ETF trading is different from a close-end fund but has some of its characteristics. ETF provides low transaction costs and tax benefits also. ETF has more than 1800 commodities covering almost all conceivable markets and trading strategy.When ETF buys or sells the creation units, it creates an arbitrage mechanism that lowers the potential deviation between the Net Asset Value and the market price of ETF shares. The exchange distributes the Net Asset Value of the ETF shares at an interval of every 15 seconds, on the day of trading. A Transparent Portfolio of ETFs is available for investors that help them to arrange the portfolio assets to buy a creation unit.


Etf trading-forex