Cryptocurrency Brokers

I’m sure you already heard of Bitcoin, Ethereum, Ripple, Litecoin or Bitcoin Cash. There are hundreds of cryptocurrencies out there, but only a few that really matter.

Luckily for traders, some brokers have already added some of these cryptocurrencies to their platform. This means that everybody can sign up and start trading Bitcoin or other coins.

After testing dozens of brokers, here are the best crypto brokers:

Best Cryptocurrency Brokers

Rank Broker Min. Deposit Regulated Features Visit*
1
review $100 YES + CRYPTO TRADING
TRADE NOW
2
review $100 YES + BITCOIN & 9 CRYPTOS
TRADE NOW
3
review $100 YES + GREAT PROMOS
TRADE NOW
4
review $200 YES + ASIC LICENSE
TRADE NOW

*Risk warning: Your capital is at risk. Plus500 is a CFD provider.

How to Choose your Cryptocurrency Broker

While we are all familiar with the broad definition of a broker, is there something more to it when it comes to cryptocurrencies? Simply put, a cryptocurrency broker refers to a website that traders will visit to trade cryptocurrencies at a set price. In many ways, they are similar to forex brokers whose services are a lot more familiar to the general public.

Now, we shall go into what aspects you as a trader must consider when choosing a broker to trade cryptocurrencies.

Top 10 Cryptocurrency Brokers

Rank Broker Min. Deposit Max. Leverage Get Started*
1
ETORO $50 1:400
TRADE NOW
2
PLUS500 $100 1:30
TRADE NOW
3
AVATRADE $100 1:400
TRADE NOW
4
PEPPERSTONE $200 1:500
TRADE NOW
5
IQOPTION $10 1:1000
TRADE NOW
6
24OPTION $250 1:1000
TRADE NOW
7
TRADE.COM $250 1:400
8
ICMARKETS $100 1:500
9
VANTAGE FX $100 1:500
10
FXTM $5 1:1000

*RISK WARNING: Your capital may be at risk.

Which Cryptocurrencies Are You Interested In Trading?

Make sure you have decided on which cryptocurrencies you want to trade in before signing up with your broker. If your choice is a prominent cryptocurrency like Bitcoin, Litecoin, or Ethereum, there will be a relatively broad availability of brokers that have trading options for those. However, less prevalent examples like Monero, IOTA, or Zcash may be a little harder to come by. So study the cryptocurrencies being offered by a broker before you sign up for an account.

Is Leverage Really Necessary? Cryptocurrency markets are volatile in nature with prices fluctuating immensely thereby generating high profits even in the absence of leverage. But for some traders, the desire for more earnings justifies the use of leverage.

Before choosing your broker, settle yourself on whether the already immense profits that come from a cryptocurrency market are enough for you or you would like to use leverage to enhance them even further, bearing in mind, of course, that will also significantly increase the risk factor to your funds.

Negative Balance Protection: It is always advisable to trade with a broker that affords the negative balance protection facility. That way, you will never be at risk of losing more than what you invested in case you sustain very heavy losses.

How Suitable Is The Required Capital For You? This is another subjective part to your decision. Do you prefer trading with a small capital or bigger one to help you zero in on bigger returns? Find out what size trades your broker is offering before you open an account.

Narrow Spreads for the Win: Let us be honest, it is only fair that your broker gets a cut from the money you generated having provided you with the essential facilities for it and all. But let us be honest, you definitely want every last dime for yourself.

A spread refers to the difference between the buying price and selling price of a trade and it varies with each broker. The spread is what counts as fees for your broker so the smaller it is, the lower the cost will be on your part.

Finer Questions to Ask Your Broker

Here are some of the more understated details about your cryptocurrency broker that could make your trading experiences so much more efficient and successful.

1. What Are The Weekend Hours Like?

This is a key detail that distinguishes cryptocurrencies from other prominent trading markets like forex, futures, and equity. Cryptocurrency brokers operate during the weekends as well. There is virtually no difference in purchasing bitcoin at the end of the week as opposed to the middle of the week during peak hours.

But there is a catch. While digital currency exchanges are available during the weekend, your broker may not. So in effect, if there is considerable movement within your relevant cryptocurrency market during a weekend when your broker is not operating, you may not have the ability to respond in any way.

2. How Is It Hedging?

Your broker is probably not keen on revealing if it is hedging cryptocurrency traders but it is important information for you to know. Why is it so important for you to know? Because, as a trader, you want to be absolutely in the clear regarding the policies for risk management being followed by your broker. Let us not forget that cryptocurrency markets are extremely volatile and an unhedged broker is more easily prone to major losses incurred by its clients. Naturally, those costs will warrant compensation via fatter spreads and additional costs for traders. It will be best to sign up with a broker that will not withhold the relevant information from you.

3. What about Commissions and Trading On Margin?

An important thing to note while trading cryptocurrencies is that their prices tend to be more similar to equities than they are to real currencies. So your broker could be charging you commissions in addition to a wide spread on each trade. That, of course, raises the cost probably a bit much for your liking.

Another similarity with equities is that the margin conditions with cryptocurrencies are significantly more than they are with forex or CFDs. Consequently, leverage is usually up to 10x. How considerable the margin rate will be for traders is down to what trading strategies and risk management they subscribe to.

4. The Authenticity of Market Data?

Aside from merely evaluating how it influences spreads, market data for cryptocurrency CFD prices can be a good indicator of how the quality of the product will be in the future. One of the more recent examples of this is BTC-e which was an immensely popular platform for trading bitcoin before it was shut down by Feds. BTC-e was the first bitcoin exchange to incorporate forex trades and so made their exchange accessible via MT4 and supplied cryptocurrency liquidity for brokers.

But once it was shut down, every broker that depended squarely upon BTC-e was left with no hedging options or market data to put a price on its crypto CFDs.

5. Are Short Sales Available?

For many traders, shorting is a crucial strategy option, the lack of which can be a deal breaker with a potential broker.  Many brokers tend to offer ‘long’ only since there are only a few hedging solutions when opening short trades.

Conclusion

Investing in cryptocurrencies can be a truly lucrative venture for you but only if you get it right. And a lot of that is down to which broker you decide to trade with. Trade with the cryptocurrency brokers listed above to make sure that your money is safe, you pick a broker with a stellar reputation and you keep the fees low.

Bitcoin vs Ethereum

Straight away, the distinction to make regarding bitcoin here is that it is still the dominant player in the cryptocurrency arena. Although that is not to say Ethereum has not been snapping at its heels lately, it has. What Ethereum offers that bitcoin does not is a wider range of applications and functions. But let us take a more detailed look at those differences now.

Ethereum Concerns More Than Mere Money

The term ‘digital currency’ does not quite cover all of what Ethereum really is. It is after all a platform rooted in blockchain containing numerous different aspects to it. There are variables like smart contracts and the Ethereum Virtual Machine (EVM) to consider as well as the currency it uses, called ether for the same sort of peer-to-peer transaction you engage with bitcoin.

Applications stored in blockchain are used by Ethereum’s smart contracts for contract facilitation and negotiation. The main benefit of said contracts is the blockchain supplies a decentralized method of validating them. Being decentralized makes it a lot tougher for the occurrence of fraud and censors. The smart contracts have an objective not only to enhance security over traditional contracts, but also to reduce the costs involved.

Ethereum is not entirely separate from bitcoin. The two do share striking similarities. They are both decentralized peer-to-peer cryptocurrencies and use a blockchain. Both are useful for the storage and transfer of value. But the fundamental intention with Ethereum is rather different. With Ethereum, a smart contract is basically Ethereum addresses which have a viable code and are stored in the blockchain.

Both these currencies are still relatively young along with the whole concept of cryptocurrency. However, if you were to ask which of the two are more stable, the answer would be bitcoin. Perhaps that is why it is still sitting pretty on the number one spot. But who’s to say that will not change? Ethereum is fast growing and volatile in nature. In this year alone, its value has spike thousands of times over.

Implementing Smart Contracts with Your Own Cryptocurrency

With Ethereum, you can create digital tokens which can be used to can represent assets, virtual shares, proof of membership and so on. They are compliant with any digital wallet and exchanges using the standard coin API.

After copying the code on the Ethereum website, you can use the tokens for multiple reasons from the representation of shares to fundraising and voting. Based on your established rules, you can have your circulation of tokens either in a fixed amount or a fluctuating amount.

Ethereum Does Not Require You to Have a Kickstarter

Ethereum enables you to increase funding for several uses. If you are trying to get a new venture going, simply set up a contract and look to the community for assistance. The funds that have been raised will be held until the aim is reached or the any certain date that has been agreed upon in advance. If your goal is not reached, the funds will go right back to the contributors or be diverted to another project which was successful. Taking out the third party, rules, fees, and all is what constitutes kicking out Kickstarter.

Skip Over Traditional Management with Democratic Autonomous Establishments

In addition to helping you outsource your funding, Ethereum can help you with organization and structuring as well. You can acquire different proposals from people who have supported your idea and put it to a vote to decide how you should proceed. This alleviates the cost of traditional structuring that includes doing paperwork and hiring managers. Ethereum will also safeguard your project from outer influences.

Block Times

With bitcoin, your block time lasts on average for 10 minutes. With Ethereum, it is closer to 12 seconds thanks to its GHOST protocol. So confirmations are faster but there are more abandoned blocks.

Conclusion

We have not had time to cover all of the differences here but from what we have shown, it is easy to understand how Ethereum and bitcoin are two different beasts. While they have their cryptocurrency status in common, that is all there is regarding their similarities.

Bitcoin is still the more stable cryptocurrency but Ethereum branches out more. Ether is merely a working part of it smart contract operations.

Bitcoin And Forex Risks

Foreign exchange has been and still is the biggest and most liquid global market in existence. Its operations continue on 24 hours a day for 7 days a week. The current main participant in this market is currency, real currency that draws its validity out of banks and governments.

But in recent years, we have seen the participation of a new type of currency, specifically cryptocurrencies which have radically and exponentially grown since they were first introduced and have made the forex market that much more lucrative and profitable.

In fact, there are leading brokers all over the world that have included cryptocurrencies as part of their trading assets. It would not be fair to try and explain them all in a single article. What we will talk about here is the cryptocurrency known as bitcoin and the potential risks involved with trading it in the forex market.

Forex Trading and Bitcoin

The first thing to note about bitcoin for all its influence on the forex market is that it is not in fact what we call real money. It does not draw its validity from any government or bank. It is entirely a virtual currency stored in a digital wallet. The future is now, it seems.

It is fair to assume then that trading it in the Forex market is going to be different than how you would trade your average dollar, and you would be right. Let us now take a look at what a regular transaction with bitcoin looks like.

First things first, you will need to own an account with a forex broker that includes bitcoin trading as part of its services. With that taken care of, let us assume you deposited 2 bitcoins and quote the value at $500 apiece. So in dollar speak, your deposit is worth 1000. What’s more you also take up a position in British currency for which the rate of exchange is $2 for each pound. So your bitcoin deposit is worth 500 in English pounds.

As for the rate for GBP/USD, we shall call it 0.45 and you quote your position at $1,111.11. So your profit will be 11.11%. However, rates tend to change all the time so let us now say the value of 1 bitcoin has gone up from $500 to $560. If you make a bitcoin withdrawal at this point, your return will be the quoted value of your position divided by current rate assigned to bitcoin. That is 1,111/560. You now get 1.984 bitcoins.

As much as you stand to make good profits from trading bitcoin, it is always advisable to be cautious and be keenly aware of the risks involved. We have listed them down here for your benefit.

Risks of Bitcoin Trading In Forex

  1. Bitcoin is traded over several exchanges and those rates differ all the time. As a trader, you must be acutely aware of the bitcoin exchange rates being used by your forex broker before proceeding to trade.
  2. It is common for practice for the majority of brokers to immediately sell off the bitcoins and retain the same value in US currency in the midst of receiving bitcoin deposits from client traders. And that goes even if you do not actually take up a position on the forex market, so you will be left vulnerable to the risk of an unfavorable rate on the US dollar influencing your deposit or withdrawal.
  3. Traditionally speaking, the prices for bitcoin are extremely volatile. An unregulated broker can capitalize on this at a trader’s expense.
  4. Being a virtual currency, never underestimate the threat of being hacked. No, the network is not entirely immune to a cyber-attack. Any deposited bitcoins are potential targets for theft by hackers. The best solution to this is find a broker that provides insurance in the event of thievery.
  5. New traders must understand how high leverage can cost them dearly.
  6. A cryptocurrency has its own way of assigning value to itself as a separate category under assets. Trading bitcoins in the forex market is basically bringing in a new intermediary form of currency that is relatively unpredictable in the way it affects profits and losses.

Conclusion

Hopefully now you have greater insight into bitcoin works in the forex market and the potential risks there are to trading it.

Bitcoin And Forex Benefits

As you may already know, Foreign exchange is by far and away the largest, most liquid market in the world running relentlessly around the globe 24/7. And while actual currency that is validated by governments and banks is at the forefront of this market, it is worth that other far more understated element of the forex trade: cryptocurrencies.

Bitcoin and Forex: What are the Benefits?

Their arrival on the market is quite recent. However, they managed to expand exponentially in terms of value and appeal for traders. And now, we even have forex brokers that will readily accept these currencies for trading. The specific currency we want to focus on here is bitcoin and the specific risks and benefits it poses to current and would-be forex traders.

Bitcoin in Forex Trading

Now we already know how real money is traded in the forex market but what about bitcoin? Being a virtual currency that is intangible and invalid within a bank or government, bitcoin represents a whole other ball game when it comes to forex trading. Here is what a typical bitcoin transaction would look like:

The first step is opening a forex account with a broker that deals in bitcoins. Assuming that is true, let us say you make a deposit of 2 bitcoins from your digital wallet and post the value for one bitcoin at $500 which is entirely realistic here. So your deposit is worth $1000 now.

Now assuming you want to take up a position in English pounds and the exchange rate is 2 dollars for each pound. That will yield 500 pounds. Now assuming rate for GBP/USD changes to 0.45 and you quote your position as $1,111.11. That equals a profit of 11.11%. But it is quite probable that the prevailing dollar rate for bitcoin will have changed in that time.

Let us assume $560 to 1 bitcoin. So now when you make a withdrawal in bitcoins the value of your position – which is $1,111.11 – divided by the current going rate for a bitcoin – which is $560. That means you will now be getting 1.984 bitcoins.

What Are The Benefits To Using Bitcoin?

  1. Decentralized valuations: There is no central bank here that implements random valuations on bitcoins. Being decentralized allow bitcoins complete immunity to any geopolitical or macroeconomic factors.
  2. Leverage: On average, the rate of leverage offered by forex brokers on bitcoin trades can be as high as 1:1000. And this can be an enormous asset to the more experienced players. But in any case, one must pay due caution to the projected losses that could be inflicted with a poor decision.
  3. No cost for transactions: Again, no banks or clearing institutions involved here since every bitcoin transaction is recorded on a public network and none of it is on paper. As a result, transaction costs normally do not apply to bitcoin even if that transaction is international. And with brokers not imposing a liable fee on bitcoin transactions, profits are that made that much sweeter.
  4. Slim deposits are enough: With some brokers that include bitcoin, you can begin with as little as $25. It goes without saying this is only trustworthy with a broker that is highly reputed and regulated by the law.
  5. Safety: Yet another benefit of not having a bank involved is you no longer have to produce your credit card or expose your bank account to make your transactions. And that is a big plus particularly if you are trading with foreign brokers since you get more privacy and incur far less of a cost.
  6. Trading at a low cost: With more and more bitcoin traders being added as clients, forex brokers incur increasingly lower costs on their operations.
  7. Limitless possibilities: Bitcoin dissolves the whole currency concept where each country runs on a certain value currency. Bitcoin does not submit to these boundaries. It is as applicable to a trader in the United States as it is to one in Hong Kong. Wherever traders are so long as they are willing, they can trade with no geographical concerns.

Conclusion

Such is the nature of bitcoin and forex and the benefits are very appealing to a lot of traders.

ethereum

How To Learn Everything About Ethereum

For those of you who are new to the concept of cryptocurrencies, no, the ether described here is far from what it is in the Marvel universe. What Ether means here is Ethereum’scryptocurrency which at its peak value was at $400.

That is an astronomical 5000% increase since the beginning of the year. So before we go into dealing with Ethereum in the forex market, it is well to get our eye in on what it is exactly.

What Is Ethereum?

As far as cryptocurrencies go, Ethereum is a prominent asset, second only to bitcoin. Despite its name, it is not something that came out of nothing. The blockchain technology that it uses is similar in many ways to bitcoin.

However, it is a programmable blockchain which means that its platform is Turing-complete. It also mean that significantly more advanced functions and applications can be added including other cryptocurrencies.

By contrast, bitcoin is limited to a singular function, facilitating peer-to-peer transactions in the form of a digital currency. It may have been the first to exploit the benefits of the blockchain technology, it has sustained scaling issues during its 8-year old life as a result of its limited functionality.

If this year has been any indication, we have seen some truly staggering growth with Ethereum. While it still remains as the second largest cryptocurrency, it is rapidly closing in on the top contender, bitcoin. Learn about bitcoin here.

And all guesses are this will happen through a phenomena known as “Flippening.” With Ethereum’s coin value having expanded dozens of times over within the year, we can only assume that it has further to climb in the coming weeks and months. No doubt then that an increasing number of traders will be keen to capitalize on this financially. So here some ways by which you can include Ethereum as part of your trading portfolio.

1. Create an Account on an Exchange

With etheruem as with any cryptocurrency, you can only buy or sell it through a transaction on an online platform. So stake out a service for this that is highly reputed. If you want some names, there is Coinbase, Bitstamp, Kraken, and Gemini. It is imperative that you select an exchange and create an account prior to trading Ethereum.

2. Verify your Account

A good tell of whether an exchange is reliable or not is if they require that you verify your account in one or multiple ways. That usually means uploading a certain amount of documents to confirm that your account is legit. The verifying process will likely take no more than a couple of days although that is somewhat subjective to the extent of activity your choice of exchange would be involved in.

3. Make a deposit in Fiat Currency

The next step involves depositing fiat currency to your account either through a bank or wire transfer. Once again, the duration of that process can last a few days before the money comes through.

4. Start Trading Ethereum

Now that you have a verified account with money in it, you are all set to purchase Ethereum as well as other cryptocurrencies through exchange. The interface differs more or less with each currency. But any case, be ready to confirm transactions and wait the allotted time which will also be pending on the full number of transactions that have been requested.

5. Withdraw ETH into your digital Wallet

Just as you have purchased ETH via exchange, you can now withdraw that currency straight into a wallet under your control. Hacking is an ever-present threat to exchanges so yes, you tokens are potential targets for theft. As a safety precaution, it is best to download and install a wallet that is compatible with etheruem and only grants you access through a key. That is about as private a place that you can acquire for storing your tokens securely.

Next you can enter the address of your account into the exchange so you can shift ether into your wallet. Take care not to use either your wallet address, password, or private key as you may encounter difficulty getting at your ether in the future.

Conclusion

Take your time, explore all angles and you can set yourself up nicely to buy Ethereum and enjoy its perks.