Recently, cryptocurrencies have become dominant in the trading industry. Many traders have tried their hand out on bitcoin trading in Binomo, and many of them have become successful.
If you are unfamiliar with this term but interested in what bitcoin trading is, this article will educate you on the things you need to know about bitcoins and bitcoin trading. Welcome to our guide for trading bitcoins: how to become an expert investor on Binomo!
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What are bitcoins?
Bitcoin, with capital B, actually refers to the technology while lowercase ‘bitcoin’ refers to a kind of cryptocurrency.
It’s a completely paperless currency and can be safely secured on a computer through the use of a specially encrypted peer to peer system. It can be mined with your personal computer, albeit mining rates have fallen drastically because of the high surge in demand, and because of that only large companies with specialized equipment can mine bitcoin.
By itself, bitcoin is simply another form of money–an electronically safeguarded, highly anonymous form of money.
However, just like other currencies, in recent years bitcoin has developed a financial market where traders buy and sell bitcoin assets and derivatives. This new type of financial tool is known for being highly unpredictable and volatile – meaning it can change prices many times over a short period.
How do bitcoins work?
Bitcoin is supported by a global peer-to-peer network of computers – which means that bitcoin technology is composed of millions of computers around the globe, all working to implement the bitcoin software.
This implies that bitcoin is decentralized, meaning there is no central, governing authority who decides the value or direction of the bitcoin currency–unlike traditional currency, which is governed by the banking industry and regulated by the government.
This software implements all the transactions involving bitcoin. Every single transaction is secured by an encrypted, electronic, one-use code that has its corresponding encrypted key (also called a seed) that can only be opened by the party intended to receive the bitcoin. These transactions are interpreted and confirmed by the blockchain technology itself through a process called mining, which is what keeps the bitcoin technology going.
It’s important to note that all other cryptocurrencies are like this. If you understand how trading bitcoins work, you now know how cryptocurrencies in general operate.
Why Trade On Bitcoins?
If you are a trader, of course, you’re going to be interested in investing your money where you can make a profit. Even though it is a relatively new currency, only developed in the last decade, bitcoin is very promising. Though some might argue that the bitcoin market is unpredictable and therefore poses a lot of risks, the profits that can be made are undeniable.
Here are a few reasons why you should think about trading bitcoins.
Very high volatility
Different from other assets and other traditional currencies, bitcoin’s value does not depend on a specific country’s economy, but is instead reliant upon global market forces. Because of this, the bitcoin market is highly unpredictable and volatile.
However, this volatility can be a strength. If you know your charts, tools, and techniques, and have a proper trading strategy, then you can stand to gain a lot in volatile markets. Another plus side is because of the quick ups and downs, you can make a profit in this market in just a short period.
Can be used to transact
Transactional currencies refer to currencies that can be used in the regular, day-to-day economy. With recently developed technology, we can now use bitcoin in our everyday transactions just as we would use traditional money.
You can use bitcoin for just about every commercial or financial purpose–from paying your loans, bills, and other expenses, to use as a highly secure money transfer to other users. However, always be wary of the commissions and fees charged for these services.
Bitcoin prices are not fixed
Unlike traditional currencies, bitcoin has no official price. As mentioned earlier, bitcoin is a decentralized currency, so there are no banks or governments to regulate its value.
Thus, the value of bitcoin depends upon global demand. If more people buy bitcoin, the demand rises and consequently price surges up. If fewer people bought it, the demand falls as well and the price plummets. The quantity of bitcoin is already predetermined, and can only be increased through a majority decision of the masses, so the supply of bitcoin rarely affects its price.
This is what drives its volatility, which offers great profit potential for traders.
How to buy bitcoins
Because of new technology, buying bitcoin is as easy as everything else. All you need to do is sign up for an e-wallet and cryptocurrency exchange platform, which are both available right at your fingertips with Binomo. Binomo users even automatically have a smooth, robust, and reliable e-wallet and exchange platform called Hodly, owned and managed by Binomo ltd.
If you’ve already signed up for an e-wallet and exchange service, then you need to deposit the money you intend to invest using your debit or credit card into Hodly. From here, buying bitcoins is just as simple as buying any other currencies in any other platform. If you do not want to spend your money yet, Hodly provides safe electronic storage where you can keep your money.
After you’ve bought your desired amount of bitcoins, you can hold them and wait for its price to rise. Once the price has risen to the amount you desired, simply resell your bitcoins for a traditional currency of your choice, thereby making a profit. All of this can be done securely and conveniently using Hodly.
Trading bitcoin using financial derivatives
If you do not want to buy pricy bitcoins themselves, Binomo offers you a way to invest in bitcoins without actually buying them. This is through financial derivatives. With this, you can predict the future price of bitcoin. If you are right, you get profit, and if you are wrong you incur a loss. The profit or loss is the difference between the opening and closing prices.
To help traders, some platforms even offer a multiplier tool. A multiplier allows you to invest more money than what you have at hand. For example, if you choose a leverage of times five, you can invest $100 worth of value with just $20, and gain equally high profits. Although a powerful tool, one has to be careful when using multipliers, as although there may be a huge potential profit, the same can also be said for losses. Binomo doesn’t have the multiplier tool yet as of this writing, though there may be one in future updates.
Interested in trading bitcoins on Binomo?
Binomo has the best tools available
As mentioned, the bitcoin market is highly uncertain. However, for you aspiring trader, this can be a good thing, because it means that you can earn more potential profit if you do well.
To help you out in your trading journey, Binomo provides you access to top quality tools to deal with this highly volatile market. With this reliable platform, you can utilize multi-graphical layouts, professional market analysis, detailed history quotes, and even market updates and warnings that notify you when prices fall or rise too hard.
Binomo offers 24/7 customer support
Binomo knows the value of a good community. Traders add a lot of value to each other through learning from each other’s shared experiences, which will allow you to learn more about bitcoin trading and investment. You can even take part in conversations without leaving your trading room.
To nurture this community, Binomo provides you with round the clock customer support to solve all your problems and answer all your queries. If you come from a supported country, you may even have phone support available to you. Do take note that this comes at a price.
Trading bitcoins on Binomo
To summarize, bitcoin is a decentralized, peer-to-peer transactional currency that can be bought and traded on an exchange. Trading Bitcoin is good because of its high price action, its utile value as a transactional currency, and its ease and availability. Bitcoin trading is done easier and better with Binomo because it has the best tools available for your use, it’s encouraging community of like-minded individuals, and the round the clock customer support.
And that’s the basics of trading bitcoins with Binomo! Do you have more information on trading bitcoins you’d like to share? Let us know in the comments below! Once again, if you’d like to try your hand out at trading, feel free to sign up for a free demo account on Binomo to start trading bitcoins right now. You can also check some of our other guides and strategies to help you out.
Good luck on your trading journey with Binomo!