Why Trade Crypto CFDs?

Why Trade Crypto CFDs?

 

What is Crypto CFDs?

A Contracts for Difference is where a buyer and a seller agree to pay in cash any difference in prices as the value of a cryptocurrency rises or falls, instead of buying the underlying asset. Hence, a contract is made between the two parties, based on their expectations of the price of a particular Cryptocurrency on a specific future date. So, there is no typical “buyer” and “seller” in such a contract.

If the trend is accurately predicted, you could get paid the difference in the value of the Cryptocurrency from the date the contract was entered into to the date of its expiry. If not, you will end up paying the difference to the other party.

The reason why many traders prefer to trade CFDs than hold the currency is that CFDs entail lower commissions in the form of spreads, which in turn allows the trader to open interim positions and gain even from lower price movements. Another difference between trading the actual Cryptocurrency and Crypto CFDs is that for the former, adequate financial capital is required for purchase, whereas with CFDs, you may choose to hold a bigger position than the amount of money you might have at your disposal.

CFD trading can also allow traders to set take-profit and stop-loss levels. This is extremely useful, given how volatile Cryptocurrencies can be.

Advantages of Crypto CFDs

The option for leverage allows you to hold larger positions than you would if you were to buy the cryptocurrency itself which can lead to higher profits, but at the same time, the downside risk is that your losses can also be just as high.

What’s more, you stand to gain regardless of the price direction, unlike investing in “physical” Bitcoins for example. So, if you expect the price to drop, you can open a “Sell” or “Short” order. And, if you expect the price to raise, you can simply do the reverse.

Another big advantage is the speed of your transaction, which is instantaneous. When trading Bitcoin CFDs with EA INFINITY for example, you don’t have to wait for an order to be filled or for the currency to be transferred to your account. You are trading a contract, which is executed immediately.

SETTING UP A CRYPTO CFD TRADING ACCOUNT IS QUICK & EASY

step 1

APPLY – Fill out our application form

step 2

FUND – By our secured funding methods

step 4

TRADE – On our reliable platform

 

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