Cryptocurrencies
A cryptocurrency is a fully decentralized, secure, digital currency whose creation is controlled by cryptography. Cryptocurrencies are not issued by central banks and their value does not depend on bank policies. Unlike regular currencies where new money can be introduced in the money supply through Quantitative Easing (QE), cryptocurrency prices are purely based on supply and demand. Bitcoin, created in 2009, was the first cryptocurrency. There currently are over 800 alternative cryptocurrencies, called Altcoins, such as Ethereum, Ripple and Litecoin.
Bitcoin and popular altcoins can be found on ICBroker, through the free, real-time data of 25 exchanges. Cryptocurrencies are somewhat similar to precious metals, in that their creation is controlled and most have a cap on the amount of units, just like precious metals, which have limited minable amounts. One of our most popular chats is the Cryptocurrencies chat where traders talk in real-time about where the Cryptocurrency market is going.
Unlike other asset classes (FX, Equities, Commodities, etc.), the Cryptocurrency market is dominated by retail speculators. With IC Broker Cryptocurrency CFDs, you’ll trade in a market where there is no central bank intervention, interbank dealers controlling order flow or giant pension funds moving prices.
Price movements on Cryptocurrencies like Bitcoin or Ethereum are driven primarily by news and prevailing sentiment, i.e. the fear and greed of retail speculators. These sometimes dramatic shifts can lead to massive intraday price swings, making Cryptocurrency CFDs an exciting product for aggressive and experienced day traders.
The IC Broker Cryptocurrency CFD product allows traders to go long or short without actually holding the Cryptocurrency. This means traders can get exposure to the price of the Cryptocurrency without worrying about the security risks associated with storing it and the counterparty risk from the exchange. This is similar to trading Energy Futures such as oil rather than owning physical oil to speculate on its price.
Cryptocurrency CFDs
Facts
Bitcoin CFD
The first and largest cryptocurrency, Bitcoin paved the ways for hundreds of similar currencies and boasts a market cap of over $100 billion.
Ethereum CFD
The world's second-largest cryptocurrency, it is labelled by many as 'the next Bitcoin'. Ethereum has received international recognition and support from giant organisations such as Microsoft, JP Morgan, and Intel.
Dash CFD
Dash's focus is on instant transactions and owner privacy. Dash has an infrastructure that enables much faster transactions than other cryptocurrencies and therefore displays higher liquidity than many of its counterparts.
Litecoin CFD
Designed by a former Google engineer to improve upon Bitcoin's technology, Litecoin offers quicker processing times and a larger number of tokens. It is also the first cryptocurrency to implement SegWit, a method of speeding up transaction times without compromising the underlying blockchain technology.
Bitcoin Cash CFD
Bitcoin Cash resulted from a hard fork of the Bitcoin blockchain. It increased block size from 1 megabyte to 8 megabytes without incorporating SegWit.
Ripple CFD
Ripple is both a transaction network and crypto token which was created in 2012 as the go-to cryptocurrency for banks and global money transfers, and has recently experienced a period of growth.
EOS CFD
EOS is a decentralized operating system based on blockchain technology. It is designed to support of decentralized applications on a commercial-scale by giving all the required core functionalities.
Emercoin CFD
Emercoin is an open-source cryptocurrency which originated from Bitcoin, Peercoin and Namecoin. Other than being a cryptocurrency, it is also a platform for secure distributed blockchain business services.
NameCoin CFD
Namecoin is a blockchain protocol that serves as a naming system. Since Namecoin is a fork of Bitcoin, it is also a cryptocurrency that can be used for peer-to-peer transactions.
PeerCoin CFD
PeerCoin aims to solve the inefficiency problem of the Proof-of-Work that is used by bitcoin and many other coins using its own Proof-of-Stake system.
Bitcoin CFD Trading Example
The gross profit on your trade is calculated as follows:
Opening Price
3910.25 * 2 = USD $7820.50
Closing Price
4200.50 * 2 = USD $8401.00
Gross Profit on Trade
USD $8401.00 - 7820.50 = $580.50
Opening the Position
The price of Bitcoin CFD against the US Dollar is 3900.25/3910.25 and you decide to buy 2 contracts at 3910.25.
Closing the Position
One month later Bitcoin CFD has increased to 4200.50/4210.50 and you decide to take your profit by selling your 2 contracts at 4200.50 each.
