Cryptocurrencies trading techniques - The Fundamentals of Investing in Digital Currencies

Cryptocurrencies trading techniques – The Fundamentals of Investing in Digital Currencies


Cryptocurrency is a virtual currency that is generally assimilated to a certain payment system called “peer to peer”. From there, you can understand that cryptocurrency is actually a currency that can be traded, sold and bought but only via the internet.

Virtual currency is actually a means of payment without the use of a medium, there are no tickets, coins or bank cards to carry out cryptocurrency exchanges, so it is mandatory to have access to an exchange platform that provides this type of service.

How to invest in cryptocurrencies?

To trade crypto currencies, two solutions are available to you: either buy cryptos, or you go through a broker. Indeed, the cryptocurrency market is volatile. That is to say that the price of digital currency varies a lot in a small space of time, which makes it either very interesting or very dangerous because you can buy a given crypto, with a very high price and the next moment, you see its price drop. So, to avoid falling into this trap, many investors decide to buy digital money and keep it for a later date, when its price increases to make a “gain”. This technique has many long-term advantages.

Otherwise you can trade your cryptocurrencies with CFDs. Indeed, (and like any financial instrument in fact) cryptos can be traded via a CFD by betting either up or down by selling or buying corresponding CFDs, such as for example BTC / EUR.

With this way, you can take benefit of the volatile nature of cryptocurrencies, and especially on Bitcoin, which can bring you significant gains in a minimum of time.

You can use this method in two separate ways using CFDs which offer the option of not having the asset:

  • Trade BTC up,
  • Trade BTC down.

For example, the XTB allows you to take advantage of periods of falling BTC, without having any on its stock portfolio! So you can take advantage of a cryptocurrency without having it first.

You can also trade the most secure social broker on the market, Xtrade and its leverage of up to 5: 1.

Broker crypto currencies: selection criteria

To choose your cryptocurrency broker, several criteria must be respected, and several points must be checked:

Reputation:  indeed, it is very important to trust the broker’s reputation. Among the various traders who have already tried it, you can consult their opinion on objective sites or on forums,

Fees:  the second point on which you should dwell, is taxation and broker transaction fees. Also check the costs of deposits and withdrawals, this can really negatively affect your earnings generated on this site,

Payment methods:  some trading platforms do not accept all payment methods because the brokers are from different countries. So the payment methods differ depending on the broker. Check if the proposed ones suit you,

Verification requirement:  some brokers allow you to remain anonymous if you do not want your transactions to be traceable, while others require a lot of documents to verify your identity,

Geographic restriction:  check that your broker accepts French traders,

Broker exchange rate:  some brokers have exchange rates of 10%.

Is online banking still a good choice for investing in the stock market?

Online banks are slightly more expensive than specialized brokers and provide access to fewer markets and financial products. However, they have the advantage of offering a global offer: in addition to brokerage, you will find the usefulness of a bank such as the possibility of opening a bank account, savings books, insurance contracts life.