Forex traders and novices are often considering trading in cryptocurrencies. There has been a
massive growth in online currencies since 2009 when the first digital coin, namely Bitcoin, has been
created and more and more people are effecting transactions with its use. Now Bitcoin is not the
only cryptocurrency anymore, there are hundreds more, however it is still the most popular and
reaches the highest prices.
Cryptocurrency has become so common that it is currently accepted in on-line shops, booking
agencies, electronic retailers or pubs. In the Internet we can find the list of companies accepting
bitcoin for payment, and this list is regularly expanding.
There are certain advantages of trading in bitcoin and other virtual currencies, which make it so
attractive to investors. First of all, the cryptocurrency market is not regulated, therefore its value is
controlled only by market participants. It is also not affected by economic or political changes.
Secondly, the return on investment can be very high, even a few hundred percent or more, and we
do not have to invest much at the beginning, since some brokers require as little as $25 for a start.
There are also no transaction costs because no entity has to act as an intermediary between the
trader and a counterparty thus there are no extra charges involved. The brokers also keep brokerage
fees very low to entice newbie traders. What is more, the transactions effected with the use of e.g.
bitcoins are safe, because we do not have to provide them with credit card or bank account details
and no one will seize our digital coins, if we have unpaid debts.
Nothing is perfect. There are also risks associated with trading in digital coins. The main of them is
the fact that the prices of bitcoins and other online currencies are highly volatile. The lack of
supervision and control over cryptocurrency market results that some brokers use this situation to
their advantage. What is more, virtual coins can be hacked, it can be simply stolen from their owner’s
digital wallet. However, we can limit the risk by choosing the brokers who are insured against thefts.
And the selection of broker has to be preceded by a careful analysis, because crypto liquidity is not
attainable for all brokers, so it is recommended to check whether the broker we have picked
cooperates with a trading platform that ensures access to enough amount of cryptocurrencies.