Trading in Bitcoin in 2017

Trading in Bitcoin in 2017 Bitcoin is a currency similar to every other, albeit digital – hence the tag “digital gold”. Trading in Bitcoin is an exciting venture that may reward you handsomely, and just like any exchange or high risk marketplace, may also cost you real money as well as lots of it. Bitcoin trading is currently on the rise as investors attempt to money in on Bitcoin, the notoriously explosive cryptocurrency. The increase of Bitcoin, the most extensively circulated cryptocurrency, began in the year 2009 by someone making use of the alias Satoshi Nakamoto. This article Bitcoin –the new money gives a brief history. As a cryptocurrency, Bitcoin is produced via the procedure for Mining-basically using your personal computer’s processing power to resolve complicated algorithms called Blocks. You earn around 12.5 Bitcoin once a block continues to be decrypted.

Another means of getting Bitcoin is to just purchase it, exchanging physical currency for digital in a Bitcoin exchange like Coinbase, Luno, Kraken, Bitfinex, Okcoin, Bittrex or Bitstamp, or via a service like Localbitcoins. The same is true for Bitcoin, except that its value comes not from an industrial financial base, but from the work done by your computer. That said, exchanges like Coinbase act as intermediaries for currency transactions, the conversion of Bitcoin to US dollars or other national currency, back to dollars or Bitcoin. Majority of these Bitcoin exchanges also double as or own trading platforms. However popular setups like Bitfinex and Okcoin have made good names for themselves through their global reach and ease of access.

Getting Started

Essentially Bitcoin trading just like conventional currency exchanges operates in the same manner of buying one currency with another. This therefore relates Bitcoin as a commodity which is no different from gold, wheat or corn that may be traded in a commodity exchange service.
By exploiting the constantly shifting relative values of various currencies and cryptocurrencies alike, very smart traders can make handsome amounts through bitcoin trading simply from moving money around these markets, in a process known as arbitrage. But care must be taken as potential to lose is almost as high.
So, to foray into the Bitcoin markets all you have to do is find the right trading platform/exchange, create an account and work your way through.
A 2017 list of credible exchanges can be found HERE

Before You Sign up

According to

Bitcoin exchanges all share certain core functionality, but their effectiveness as trading networks can vary greatly as the result of small changes in their design.

However several key indices has to be considered when choosing an exchange or trading platform.

When trusting a Bitcoin exchange with your money, you want to ensure that the security measures are top of the line. Almost every Bitcoin exchange uses two-factor authentication at the least to protect your account from hijacking, but some exchanges go above and beyond to ensure client privacy and security. Everything from advanced encryption methods to offline, unhackable ledgers, to strict hiring procedures can help make a Bitcoin exchange more secure.

Trading & Currencies

The trading volume of a Bitcoin exchange can tell you a number of things about the exchange. It lets you know that many people trust the network with their money, which speaks well of business practices. A larger client base and higher trade volume ensure more equitable trades for all involved because everyone has more potential trade partners. As a rule, Bitcoin exchanges with higher trading volume tend to stick closer to the average market value of Bitcoin, while smaller networks tend to skew higher. Which currencies a network accepts can also affect its trade volume, as well as its usefulness.
Some exchanges use a maker-taker fee model, where those who place buy and sell orders designed to move the price up or down (makers) pay no fees, while those who accept whatever offers are currently available (takers) pay a fee for the convenience. This ensures that traders are always acting to stabilize the price, keeping it as close to the market average as possible.

Every Bitcoin exchange has a slightly different fee structure, designed to suit various usage patterns and cater to distinct audiences. Almost every exchange uses a volume-based fee schedule, where those offering to buy and sell large chunks of Bitcoin pay lower fees. Fees express a percentage of the transaction amount and generally cap at around 0.30 percent.

Almost every Bitcoin exchange offers an API, or application program interface, to allow custom software to interface with the system. This allows you to develop advanced tools for managing money automatically without having to do everything by hand. Where Bitcoin exchanges vary is in the specific functionality their APIs provide. For example, some APIs have built-in functionality for trading on margin, making them ideal for day traders and other currency speculators.

Fortunately, given the anonymous nature of Bitcoin, you usually won’t have to include every personable, sensitive information. So that is how you make your foray to Bitcoin Trading.

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Author: elprinz

I have been in the Cryptocurrency ecosystem for about three years. My passion for this niche of financial tech space inspires me to share with you all I can in the world of Cryptocurrency, Blockchain and financial technology.

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One comment

  1. Very Well written. In this day and age with lots of crypto-springing platform and services, knowing the credible ones and places to get useful information is crucial. Your article is nicely aligned, I like the Bitcoin exchange and security part.

    Keep up the good work.

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