LONDON, UK / ACCESSWIRE / June 11, 2020 / Getting started as a Bitcoin Trader is similar to traditional stocks and forex trading but it comes with significantly greater profit making opportunities as well as far bigger risks.
Bitcoin Trading is the act of speculating on price movements through a brokerage account, or trading the largest coin via crypto exchanges. Bitcoin trading gained investors traction amid the volatility factor. The fast intraday day price swings have also been creating numerous profit making opportunities for value investors to go long or short.
What are the advantages of being a Bitcoin Trader?
- Volatility: The premier cryptocurrency was first created in 2009 but the first real surge befell in 2010 when its price grew from $0.0008 to $0.08. The mother of all cryptocurrencies has seen massive price swings since then. While bitcoin price had continued its rise and fall between 2010 and 2016, the largest crypto coin gained investors’ attention following the meteoric price changes that started occurring in the fall of 2017.
- Around the clock trading: Unlike stocks and bond markets, bitcoin trades around the clock and seven days a week due to lack of a centralized governance system as digital currency markets are largely unregulated.
- Higher liquidity: Liquidity factor is key when it comes to investing because it indicates how swiftly a bitcoin can be changed into cash. The entire cryptocurrency market is liquid as trading transactions are dispersed across numerous exchanges.
- Go long or short: Bitcoin trading platforms permit investors to take advantage of the potential upsurge in price by going long as well as going short if the markets are falling.
- Low fee structure: The rising competition among brokers and exchanges along with bitcoin’s ability to be traded in a peer-to-peer manner lowers the overall cost structure for bitcoin traders.
- The scarcity factor: About 18m bitcoins have been mined yet with the total mining capacity of 21m coins.
How do I become a bitcoin trader?
The process of bitcoin trading is fairly simple.
Bitcoin traders are categorized into two groups: long term and short term traders. The long-term traders hold their investments with expectations that price will move to a certain level over time.
The short term traders, on the other hand, predict the intraday behavior of bitcoin price with the intention of generating profits from price swings.
How much can a bitcoin trader make?
The price movements always offer profit-making opportunities for investors, either in a speculative short term pattern or as a long term investment.
Bitcoin price surged 40% in May and it is up 100% from March low. This means that traders who have placed long bets when bitcoin bottomed around the $5000 level in March would have generated massive profits from their investment.
Bitcoin price volatility is unlikely to calm, with bulls like John McAfee predicts bitcoin price to hit the $1m mark.