There are around 100,000 million bitcoin traders worldwide. Trading cryptocurrencies is risky, but if you’re smart about it, you can make a good amount of money. However, few people know that you can also trade crypto futures.
That’s right, futures contracts are available for cryptocurrency. That means you can get paid out in cash trading on the rise and fall of the crypto industry. But is now a good time to start trading futures on crypto?
This article will answer that question for you.
The State of Crypto Futures
These are strange and uncertain times for crypto futures. While crypto is at a historic high, prices have been fluctuating in the past few weeks.
Futures trading is more complicated than standard cryptocurrency trading because you’re speculating on how well the market is going to perform. You can think of it as placing bets on how well cryptocurrency is going to do.
Currently, the people most interested in the benefits of future investing are crypto miners. Crypto miners can be looked at as the manufacturers of the crypto world. They get paid out in bitcoin, so if they predict that the world of bitcoin is going to tank, investing in futures ensures that they make the same amount of money.
Most traders in the world of cryptocurrency futures make us of short-selling. Different crypto exchanges charge different overhead fees for trading crypto futures, so you have to consider whether that’s worth it.
Bitcoin futures provide a way for you to trade with more money than you currently have available. Depending on the provider, you might be able to trade with a ten percent margin, trading 2,000 dollars while only having to put 200 dollars in. That 200 dollars acts as a sort of security deposit — you don’t have to learn about losing more than that, but you will lose it if your trading drops below a certain amount.
One of the best things about crypto futures is that you can back out at any time.
The State of Cryptocurrency
It’s easy to get lost in the specifics of crypto futures. At the end of the day, you still need to understand the current state of cryptocurrency.
Remember that crypto is at an all-time high. There are several coins that are extremely popular right now, and people are finding creative ways to use bitcoin.
For example, there’s probably a bitcoin ATM near you. You can track this information online; click to see all of the bitcoin ATM information you might need.
Understanding Futures for Crypto
At the end of the day, trading crypto futures is a good idea. It’s a way to trade without succumbing to the excessive volatility of the cryptocurrency market. Make sure you stay up on developments in the world of cryptocurrency, however, so you know when to pull out.
For more articles like this, check out our “digital market” section.