Crypto trading - Best crypto trading platform 2023

Cryptocurrency is a digital asset that can be used as a medium of exchange online. Coin ownership records are held on a blockchain ledger and it is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend.

The pseudonymous Satoshi Nakamoto unveiled the first cryptocurrency, Bitcoin, in a 2008 white paper, and the ledger started in January 2009. Bitcoin is a decentralized cryptocurrency, meaning it is not controlled by a single individual or organization. It is designed to facilitate quick, convenient and secure peer-to-peer payments in the digital sphere.

Bitcoin remains the world’s most prevalent cryptocurrency, accounting for around 60% of the total market cap, but there are now hundreds of altcoins too. Most are decentralized, but others – such as XRP – are controlled by a company. There are also stablecoins, non-fungible tokens, DeFi projects and all sorts of other exciting initiatives underway in the crypto space.

CFD stands for contract for difference. It is a financial derivative that allows you to speculate on rising or falling prices without having to take ownership of the underlying asset.

You can buy and sell CFDs relating to a huge range of assets. They include stocks, funds, indices, commodities, precious metals and forex. However, CFDs are particularly attractive to anyone that seeks to profit from the crypto sector.

Many investors find it expensive, time-consuming, inconvenient and risky to buy and store cryptocurrency. You are charged substantial fees to buy Bitcoin, buy Ethereum and so on, then you have to pay fees to transfer your crypto to your wallet, and you have to pay fees to sell your crypto too.

Meanwhile, hackers and all sorts of scam artists will try to steal your crypto, so you have to invest in expensive hardware wallets and take all sorts of security measures to keep your holdings as safe as possible. This can be a painstaking and nerve-wracking process, so many people are looking for an option that allows them to profit from swings in crypto valuations without having to actually go through the rigmarole of owning crypto.

That is where CFDs come in. CFD trading involves buying and selling contracts for difference on the price of an asset, such as Bitcoin or Ether, via an online provider. You essentially enter into a contract to exchange the difference in the price of the cryptocurrency from the point at which you open the contract and the point at which you close it.

Your profit or loss depends upon how accurately you forecast the direction in which the cryptocurrency moves.

You can either go long or short on an asset. Going long is the same as buying it, and going short is the same as selling it. If you think a crypto will go up in value, you can buy it. If you believe it will decrease in value, you can go short on it, which means you are selling that asset.

Your crypto trading profit or loss will only be realized once the position is closed.

The length of your trade can vary each time. Some people like scalping, which takes place over a very short space of time and requires constant focus, risk management and skill. Others prefer day trading, intraday trading, range trading or swing trading. You can have multiple trades open at the same time, which helps you hedge and manage your level of risk.

Spread – This is the small difference between the sell price at which you go short on a cryptocurrency and the buy price at which you can open a long position on a cryptocurrency. Sell prices are always slightly lower than buy prices, no matter what instrument you are trading or what site you visit. nextmarkets trading platform is renowned for offering low spreads, which provides value for crypto traders.

Commission – Some sites will charge commission fees for opening trades on your behalf, but that is not the case at nextmarkets. We offer commission-free trading of more than 7,000 stocks and 1,000 EFTs, plus a range of cryptocurrencies. Our lean corporate structure and high degree of automation allows us to operate without order fees, handing our customers a significant cost advantage when using our crypto trading platform.

Deal size – CFD trading is conducted in standardized contracts known as lots. The size of each lot depends on which asset you are trading, and it follows the manner in which the asset is traded on the market. As you can buy fractions of cryptocurrency tokens, deal sizes on crypto CFDs are very flexible.

Duration – You will not normally be presented with a fixed expiry when trading crypto CFDs, as you close it when you decide to sell the contracts you took out. However, you can incur overnight funding charges if you keep a position open past certain cut-off times, so read the terms clearly. There are also forward contracts, which have a specific expiry date, and all funding charges will be factored into the initial spread when taking out such a contract.

Profit and loss – This simply refers to the return you make or the loss you incur when conducting a crypto trade. You can work it out by multiplying the number of contracts by the value of each contract, and multiplying that figure by the closing price minus the opening price.

First you need to sign up for an account at our site, which allows you to enjoy crypto trading online at any time of the day. The market never closes, so there are essentially no set crypto trading hours.

Opening an account takes just five minutes. You will be invited to enter your email address, choose a password, select your country of residence and decide whether you want to receive news alerts. You can then click “Register”. You must then enter your phone number and type in a verification code sent to your phone via SMS.

When you have provided the necessary details, you can start trading. In order to unlock the full range of trading possibilities, you must complete a simple KYC (know your customer) process, which just requires you to provide proof of identity.

You must then fund your account. You can use a debit card, PayPal or an e-wallet such as Skrill. You will not be charged for making deposits, and the money should arrive in your account quickly, allowing you to start crypto trading.

Click on the “Markets” option at the top of the home page and click on the cryptocurrency that you wish to trade. You will be presented with a candle chart showing you how the asset has performed recently. At the top right of the page, you can click either the red “Go Short” or the green “Go Long” button.

This will trigger a “Market Order” box in the middle of the screen. You will see the sell price and the buy price clearly displayed in red and green. Enter the amount you wish to trade. You can click for stop loss or take profit orders, which are detailed later in this crypto trading guide. The box will automatically inform you of the margin, and you can then click to open your position.

You can then keep tabs on how your position is performing and close your position when you want to exit the trade. Withdrawals are quick, secure and convenient, and the customer service team can help you with any part of the banking process that is unclear. They will be able to explain your leverage options and walk you through the trading process in greater detail if necessary.

Stop loss and take profit orders

One thing to bear in mind is that around two-thirds of retail investors lose money when trading CFDs, so it can be helpful to take steps to protect your investments. A stop-loss order is one key tool in your arsenal. This orders the provider to sell the contract if the crypto asset reaches a certain price, thus limiting any potential losses you might incur. For instance, if you were to set a stop-loss order for 10% below the price at which you opened the contract, the most you can lose is 10% in a worst case scenario.

On the other hand, a take profit order instructs the provider to close your position once a certain profit target is reached. This locks in profits and protects you in case the asset experiences a swift downturn before your position is closed. That can be a useful tool when you consider how volatile cryptocurrencies are.

Hedging with crypto CFDs

Crypto CFDs can allow you to protect against losses in your investments. For example, if you hold a substantial amount of Bitcoin, and you fear that it could be subject to a short-term decrease in value due to a regulatory clampdown or general bearish sentiment, you could offset some of the potential losses by going short on Bitcoin in a crypto CFD trade.

Crypto traders seek to capitalize upon changes in the value of coins such as Bitcoin and Ethereum. The main reason behind the shifts in value these coins experience is basic supply and demand. When demand increases, the price of a cryptocurrency will go up. If demand decreases and selling pressure intensifies, the price will go down.

There are a wide variety of factors that can cause demand to spike and drop. The next section of this crypto trading guide focuses on the fundamental and technical drivers for price moves, and explains how some traders conduct analysis in a bid to predict which direction the cryptocurrency market will take.

How to predict crypto price moves

There are two key methods used to determine whether a cryptocurrency will increase or decrease in value: fundamental analysis and technical analysis. The former refers to an exploration of the big picture for a particular cryptocurrency, while the latter uses historical data and a host of statistics in an effort to predict future price moves. Fundamental and technical analysis methods are also used to make predictions on stocks, funds, commodities, forex pairs and other tradable instruments.

Fundamental analysis requires you to conduct research into the various macroeconomic and microeconomic factors that could influence the price of a particular cryptocurrency. For example, the price of Bitcoin has increased when big companies like Tesla and MicroStrategy have invested in it, or when leading payment providers such as PayPal have incorporated it.

A stream of upbeat news generally leads to a move to the upside for a cryptocurrency, whereas bad news typically pushes the price down. That can include regulatory clampdowns, developmental issues, forks, or the rise of a competitor. This has particularly been the case with Ether over the years, as many altcoins have been dubbed the next “Ethereum killer”.

You can essentially read up on a coin, learn of any upcoming developments that might increase or decrease its popularity and make your trades accordingly. Crypto is also tied to the wider economy, and Bitcoin has often performed well after news of major fiscal stimulus schemes being approved.

Technical analysis is the study of trading volumes and historical price movements. Analysts seek to find historical patterns that can be applied to the current situation, so you will often hear about support levels, resistance levels, consolidation, price discovery periods, corrections, tops, bottoms, double tops, gaps, pennants, flags, wedges, triangles, cup and handles, reversal patterns and so on. It can be a fascinating world to immerse yourself in.

Some traders focus heavily on technical analysis, while others largely ignore it and concentrate on fundamentals. Others like to incorporate a healthy mix of both pursuits when trying to predict future price movements for a cryptocurrency.

There are hundreds of different cryptocurrencies to choose from, but the two most important coins to familiarize yourself with are Bitcoin and Ether. As previously mentioned, Bitcoin accounts for around 60% of the overall crypto market cap. Ether, the native token on the Ethereum blockchain, typically accounts for around 10% to 15% of the total market, and it is larger than the next seven cryptocurrencies combined.

They both perform very different roles. Bitcoin is the original cryptocurrency, and it was designed to enable peer-to-peer transactions, but it is now more widely seen as a store of value. There is a finite supply of just 21 million Bitcoins, and many have been irretrievably lost, so the general scarcity of this asset appeals to many investors seeking diversification in their portfolios.

You could buy a single Bitcoin for less than $1,000 in 2017, but the price went past $60,000 in March 2021. The long-term increase in its value has been huge, but it is volatile. Bitcoin is subject to sharp short-term fluctuations, plus lengthy bull runs and bear markets, so it is a perfect asset for traders, who thrive on volatility.

Ether is another volatile asset, but its role is different to Bitcoin. Ethereum is a blockchain network designed to host a wide range of decentralized finance (DeFi) projects. It handles far more transactions than any other blockchain. Ether is the native token on the Ethereum network.

There was an initial supply of 72 million coins when Ether went live in July 2015, and there are now more than 112 million coins in existence. However, Ether will become a deflationary asset, as it is in the process of moving from a proof-of-work consensus mechanism to a proof-of-stake mechanism. This will involve burning the fees rather than handing them to miners, meaning the overall supply will decrease.

Both Bitcoin and Ether can be used to make payments at a wide range of online retailers. However, buying and storing them is fraught with security concerns and fees, so many people prefer to trade them instead, as that gives you the opportunity to profit from price swings without having to hold them.

Several contenders to the Bitcoin-Ethereum duopoly have emerged over the years, from Bitcoin Cash and XRP to Cardano (ADA) and Polkadot, but none have been able to knock BTC and ETH off their perch. If you are interested in crypto trading, these are the two key coins you need to familiarize yourself with. You might eventually decide to get into an altcoin such as Litecoin, Bitcoin Cash or Binance Coin, but most crypto trading focuses on Bitcoin and Ethereum.

These crypto trading tips can help you maximize your chances of success:

• Never risk more than you can afford to lose. You should not be trading with money earmarked for your rent, bills or food shopping. It might help to set aside an amount you feel comfortable with and then stick to this amount as your trading bankroll.
• Consider setting yourself goals. It can help many traders to have a clear idea of the level of profit you hope to make from a particular trade before executing it. Having a clear plan can help you know when to exit the trade, thus locking in profits.
• Use tools such as a stop-loss order and a take profit instruction to your advantage. These features give you a greater level of control over your trades, so they can form a vital part of your strategy. Learn the concept of trading with leverage and how to use it to your advantage. These topics are covered in a crypto trading for beginners guide, which explains precisely how to execute trades.
• Remember that cryptocurrencies are volatile assets. The prices can move around considerably on a short-term basis, so you should try not to panic if the price quickly goes up or down, as it can swiftly rebound or correct in a very short space of time. You essentially need to embrace the volatility, seek to profit from it and learn to ride it out if it does not initially go in the direction you hope.
• Conduct thorough research. You should arm yourself with a comprehensive understanding of the cryptocurrency you are trading. Read about its history, learn about the sort of price patterns that have played out over the years, and gain a strong grasp of the blockchain technology underpinning it. You should also absorb as much crypto news as possible, and stay abreast of wider economic trends and the broader crypto market, as that will help you conduct an effective level of fundamental analysis. Try to avoid confirmation bias, whereby you only read articles that fall in line with your opinions. Read widely, take on a range of different viewpoints, analyze the information and then make informed trading decisions from a position of strength.
• Learn how to perform technical analysis. Even if you firmly believe that fundamental analysis is the most important way to determine whether a cryptocurrency will go up or down in value, it can help to supplement your analysis with a technical evaluation, either to confirm or challenge your theory.
• Find a trading style that suits you best, refine it and hone your skills. Learn from your mistakes as well as your triumphs, and you will soon settle on a crypto trading strategy that works for you.
• Only use a licensed, secure, reputable crypto trading site like. Scam sites are common in the crypto space, so you should always remain vigilant.

Trading CFDs provides you with an exciting opportunity to profit from fluctuations in crypto prices without the expense and hassle of buying and holding coins. However, profits are not guaranteed, so you should conduct thorough research, gain a thorough understanding of the intricacies of trading and set yourself clear goals. If you are interested in crypto trading, find a high-quality site with tight spreads, a strong user experience and rock-solid security record on offer.