SPREAD BETTINGON BITCOIN
Compare The Top UK Spread Betting Brokers Offering Bitcoin Trading!
Spread Betting on Bitcoin: The New Frontier
Bitcoin or BTC is a digital currency that is not regulated by any government or central bank around the world. The decentralised nature of this cryptocurrency and the fact that it acts independently of banks and financial institutions sets it apart from fiat currencies. For starters, trading Bitcoin is completely anonymous and conducted with minimal fees or commissions (since there are no middlemen). No names, addresses or other personally identifiable data is required to trade Bitcoin. As the world’s first digital currency, Bitcoin or BTC has rapidly gained popularity and is widely accepted at merchants, financial trading platforms and among buyers/sellers around the world. As part of its evolution, Bitcoin is now also actively traded in many FX pairs at leading UK spread betting sites.
Information on How Bitcoin is Traded in Forex Pairs
At the time of writing, 1 Bitcoin was trading at $615.81, and it is possible to place spread bets on this digital currency at top UK trading platforms. There are many inherent benefits to trading Bitcoin, including guaranteed security against theft, 100% FCA-compliant trading, the ability to go short or to go along on Bitcoin-related currency pairs, speculate on the price of Bitcoin against a wide range of global currencies, and more. Many trading platforms now offer risk-free trading on Bitcoin by way of demo-trading accounts.
The symbol for Bitcoin in the ‘pairs trading’ arena is XBT. Therefore, there are multiple forex pairs that can be traded including, XBT/EUR, XBT/GBP and XBT/USD. When it comes to binary options trading with forex pairs, it is entirely possible to place daily or weekly bets with Bitcoin. As an example, the Bitcoin/USD pair may have a dealing period of 24 hours with 1 point referring to $0.01/XBT. A minimum spread may be 250 with a typical spread averaging around 500. The limited risk premium could be 100 with a margin requirement of 7.5%. This varies from spread bettor to spread bettor, but it serves as an example nonetheless.
How to Spread Bet on Bitcoin: Volatility Since 2008
It should be remembered that Bitcoin is volatile. This coupled with its digital nature adds to the complexity of trading Bitcoin. Back when it was established in 2008, it served as an alternative to traditional currencies. It was born out of the global financial crisis – around the same time that binary options became a mainstream trading option. Unlike fiat currency which relies on fundamentals for its demand/supply, Bitcoin is backed by nothing and represents nothing. Bitcoin production will be capped at 21 million coins and no more. Demand/supply constraints are expressly limited to market expectations.
Is Bitcoin a Good Store of Value?
This digital currency experienced bubble-like growth in 2013 April when it popped from $30-$260 in a month. It then retreated back to $70 and is now trading at over $600. With spread betting though, you don’t need to worry about acquiring currency in order to sell it or buy it – you simply make wagers on the price fluctuations of the commodity. Thus, many spread bettors make their own markets. Many market analysts liken gold and Bitcoin to one another: they are both seen as stores of value. But the volatility of this cryptocurrency ensures that it will be difficult, if not impossible to maintain store of value status. Many financial trading companies have pulled Bitcoin spread betting from their list of options, owing to the volatility in this market. Typically, there are no stops on trading Bitcoins as a spread bet and you can go long/short.
Ready to start spread betting on Cryptocurrencies? Check out our full UK Spread Betting Brokers Who Offer Cryptocurrency Trading!