Let’s discuss the specifics of Bitcoin trade. Bitcoin trade remains quite a controversial subject. Traders feel eager, investors — hesitant. Historically, the goods are not very well established as an asset class. Shares sharply outperformed commodities in terms of long-term investments. However, goods are extremely good for traders because of their high volatility.
Prices tend to change rapidly in a short period of time. Therefore, traders get to earn big money because of volatility in the commodity market. Unfortunately, the rapid increase in prices has no tendency to attract long-term investors who are willing to receive a small profit over many years.
Gold addicts for many years insisted that people invest in gold, citing global economic fears and a long history of using gold as a valuable commodity. However, over time, gold in comparison with most asset classes turned out to be a rather bad choice. The same applies to silver, and to any similar product.
Bitcoin trade. Specifics of Bitcoin market
Many global exchanges organize Bitcoin trade. It is known on the market for its high volatility. Unlike traditional markets, the Bitcoins market never closes. That means that investors and traders can buy or sell Bitcoin at any time of the day. That fact scores well to Bitcoin trade. Bitcoin’s volatility and always open exchanges make it ideal for traders who have an interest in short-term profits.
Every day on the crypto exchanges, such as Poloniex, Bittrex, Kraken, and others, Bitcoin trades more than 1 billion dollars. This year Bitcoin reached a record level of 4,400 dollars. Its market capitalization exceeded 70 billion dollars. If we compare Bitcoin with altcoins, then it has a much larger daily volume. Therefore, greater volatility. This makes Bitcoin an ideal digital currency for short-term traders.
Although this cryptocurrency is much more volatile than altcoins, the volume of Bitcoin trade is still quite low. That, unfortunately, allows large traders to try manipulating the course. Since most Bitcoin exchanges don’t have regulation rules and SEC does not monitor them, traders must be cautious.
Summarizing above mentioned, we can assume that learning Bitcoin trade, as well as stocks and goods, can be useful. Learning is the best strategy to swim but not to drown in murky waters of Bitcoin trade. Even so, it will be that way if the trader focuses on explicit growth trends and a downward trend.