As it was the first cryptocurrency in the world, many believe that Bitcoin will most likely face traditional currencies. However, given the evolution of its price, it seems that it will experience high volatility along the way.
You can start trading in Bitcoin by following these four steps:
Decide how to operate in Bitcoin Know the factors that drive the price of Bitcoin Choose a trading strategy for Bitcoin Perform your first operation in Bitcoin There are two ways to invest in Bitcoin: buy the cryptocurrency directly in the hope of being able to sell it later and make a profit, or invest in it. The last option is how CFDs work.
Advertisement 3 When you open a position with CFD, you enter into a contract based on the prices of the underlying market.
It is a leveraged product, which means you can deposit a small initial amount and get exposure from a much higher position. This system can increase your benefits, but remember that it has the same effect on your losses. Find out more about the difference between buying cryptocurrency and trading with it.
Do I have to access a market to operate in Bitcoin? When you work in Bitcoin, you never interact directly with a market. Instead, you operate on our purchase and sales prices, which we obtain from various sources. Then, to open a position on the price of bitcoin, you only need a trading account with IG. The Bitcoin markets work in the same way as traditional exchanges, allowing investors to buy or sell the cryptocurrency. However, there are some advantages that distinguish them completely:
- They are not regulated, they do not have public records or the necessary infrastructure to respond quickly to requests for support.
- Their engines and servers are unstable, which can result in market suspension or lower execution reliability.
- They have costs and restrictions associated with the entry and withdrawal of funds, and days are required to open an account.
- When trading in Bitcoin, you also achieve a significant improvement in liquidity at the price you choose. When you buy and sell directly on the market, you usually have to accept several prices to complete your order.