What is Bitcoin
Trading the global market’s assets have been around for hundreds of years, dating all the way back to the 16th century, according to some sources. Bitcoin trading, on the other hand, is fairly new activity on the global market, despite crypto assets being around for the past ten years or so. If you are new to the crypto market, there a few aspects with which you should become familiar before you start trading Bitcoin with your brokerage or crypto exchange of choice. Whether it’s the virtual currency’s high volatility or popularity among new traders, Bitcoin is still reigning over the market with an iron fist.
Bitcoin is an alternative, electronic payment method that enables clients and merchants to send and accept funds via blockchain, a dispersed, open source network which stores its users’ data on numerous servers. That means that any attempts to tracing any interaction using this method are the literal equivalent of looking for a needle in a haystack. It’s close to impossible, which is why this asset is so popular among online shoppers.
Bitcoin was the first digital currency, which an unknown individual or group under the pseudo-name of Satoshi Nakamoto launched back in 2009. The task force behind it is considered the trailblazers that paved the way for the thousands of digital assets that followed it since that fateful moment all those years ago.
While you could trade Bitcoin and other cryptocurrencies the way you would trade other assets, the volatility is nothing like you’ve ever seen before.
Highly Volatile Asset Ahead
In the past, Bitcoin has managed to surprise fans and crypto traders by reaching incredible and likely unprecedented highs. December 2017 will go down in history as the month where Bitcoin reached its peak, having exceeded the $19,000 level. While some of its movements since have been less than favorable, the one thing that Bitcoin traders absolutely adore about this virtual currency is its healthy dose of volatility.
Each movement up or down could be estimated at hundreds of dollars, so the possibility of impressive gains is in the cards for those willing to take the risk. Then again, the losses could be just as high if you’re not careful. This is one of those times where you should set your Stop Loss and Take Profit boundaries in advance.
Popularity in Asia
Despite its sharp falls in the past year, Bitcoin maintains its popularity among traders, businesses, and clients residing in Asia. Avid Bitcoin investors can be easily found in China, Singapore, Hong Kong, and South Korea. It’s safe to say that a large part of them still believe trading Bitcoin now is a smart move, considering how many of them are trading Bitcoin themselves.
Cryptocurrencies as a whole are also very popular for everyday use in that part of the world, and numerous businesses have adopted this method in accepting payments for goods and services. For example, Japan officially recognized Bitcoin as legal tender back in March 2017. In much simpler terms, Japan accepts this cryptocurrency as a real currency. This then translated to strengthening Bitcoin and giving its market value a boost. Thanks to these countries’ taking interest and supporting this virtual currency, Bitcoin isn’t likely to disappear anytime soon.
Bitcoin as an Investment
Whether Bitcoin trading is something which you should add to your portfolio is a very personal question. The answer depends on several factors such as:
- Are you patient?
- Can you quickly adapt to changes?
- Do large movements intimidate you?
- Do you have what it takes to be a crypto trader?
While trading Bitcoin sounds like a straightforward activity, a lot goes on behind the scenes. You have to stay alert and be able to make split-second decisions at times. In addition, even if you think you know how this asset behaves, it’s dynamic and things could change from one minute to the next. While we are not saying this activity is exclusively reserved for those expert traders, you should do your research before opening your next position on any trading platform or online exchange.
Your Next Move
At this point, you may feel one or another about Bitcoin trading. Either you’re all for it and are excited to take the next step, or you may feel as though you need a bit more information before you make your final decision. That’s where CM Trading comes into the picture. We offer our clients a wide range of educational materials such as video tutorials, market updates, and guides on how to trade different assets including but not limited to Bitcoin.