How To Trade Bitcoins On The Exchange

Cryptocurrency is a digital currency market where traders can buy, hold and sell instruments round the clock. When a trader talks about investing in this financial market, the first virtual currency they think of trading in bitcoin. 

This is due to the presence of the bitcoin currency in the market and its high market value. It is the first cryptocurrency with a good market worth, making it easier for traders to invest. 

To learn more about how traders can trade bitcoins on an exchange, we have a complete overview through this article. It will assist traders in trading bitcoin on an exchange and have profitable returns. 

How to Trade Bitcoins on the Exchange?

Bitcoin trading is speculating on the price movements of the cryptocurrency. Traders buy bitcoins through an exchange in the hope of a price increase in the time period. However, most cryptocurrency traders go for derivative trading, where they can invest in both rise and fall of price. 

This trading style makes most of the bitcoin market volatile. A trader can take a market position with these derivatives through any exchange. They can take advantage of the market fluctuations without any ownership. 

Steps for trading Bitcoin:

Selecting Crypto Trading Exchange

To begin with, a trader needs to find a good exchange to trade bitcoins. Traders can go with popular trading service providers such as Capitalix or The London Stock Exchange to trade. 

Traders should check all the details of the exchange:  

• Services
• Available cryptos
• Payment method 
• Brokers 
• Features 
• Trading tools 
• Trading platforms 
• Wallets 

Trading Account

• The first thing that a trader requires to trade bitcoins is a trading account at the exchange. For this purpose, a trader has to register with the exchange; it will require a name, address, contact number, and password. 
• Next, they have to upload the required documentation for the identification and verification of the trader. Once the verification is done, the exchange provides access to the trading account. 
• Traders can deposit funds, use the trading services and begin their trade. 

Connecting with Payment option

Once the account is created, traders can connect their payment option. They should go with a payment method that is suitable and supports the exchange. Mostly, exchanges have bank accounts, credit/debit cards, or any other method available. 

Usually, it is advised to go with a bank account as cards may not be a good option. This is because of the fact that the price volatility inflates the cost of purchasing. 

Also, the bank account should allow the deposit of bitcoin at the exchange. There could be fees for the deposit of funds, and traders can know all these in advance for a smooth process. 

Place Order

Now, the account and payment method are set so traders can place their orders. They can buy bitcoin as per their funds available and risk tolerance level. The cryptocurrency market has grown significantly with its advanced features. 

The exchanges have all the required facilities for the traders; they can have market and limit orders, even there are exchanges that provide stop-loss orders. For example, Kraken has all the stop-loss, limit, take-profit, and other order types for its clients. 

Secure Storage

The exchange provides wallets to store the purchased bitcoin or another cryptocurrency. These are digital wallets to store the bitcoins and have proper security. 

Traders are provided with private keys and many security features such as two-factor verification and KYC to ensure security. These are for the clients’ safety, and traders can use them if they want. 

There are hot and cold wallets with exchanges where traders can store their bitcoin in. 

Trading

When a trader finds good market opportunities, they can buy other bitcoins or sell the existing ones. This is done with proper market predictions and risk management. When traders find high market profits, they sell or buy bitcoins for further trading. 

Bitcoin trading through an exchange is a simple process and requires not much documentation or a hectic process. 

Final Verdict

Trading bitcoins through an exchange requires a small procedure to be followed by traders. They can select the best exchange with the bitcoin cryptocurrency and excellent services. 

After which, they can set up their trading account, deposit funds, and store the bitcoins in their wallet for security purposes. A safe method to trade and store bitcoin with an exchange.

Looking for the best Forex broker that suits your trading style and needs, ABInvesting can be a perfect choice in this case. Open a trading account with Capitalix and start your journey today!