“Well, I think it is working. There may be other currencies like it that may be even better. But in the meantime, there’s a big industry around Bitcoin. — People have made fortunes off Bitcoin, some have lost money. It is volatile, but people make money off of volatility too.” – Richard Branson
The cryptocurrency industry as a whole has received a lot of attention and exposure during 2017 because of rapidly rising Bitcoin prices. This price increase from just under $1000 US in January 2017 to circa $13 860 in December of the same year was nothing short of phenomenal.
Additionally, cryptocurrency investments are being considered as a mainstream form of investment. There are currently over 120 digital currency hedge funds, and the first Bitcoin Futures were offered by the Chicago Board Options Exchange (CBOE) in December 2017.
Therefore, the question that begs is whether you should invest or trade in Bitcoin and its associated digital currencies.
As with all things, there are advantages and disadvantages to both options. Here is a brief look at a few of the pros versus the cons of investing or CFD trading in cryptocurrencies:
The outright purchase of any one of the virtual currencies such as Bitcoin, Ethereum, DASH, and Ripple, needs to be seen as a long-term investment. The following advantages and disadvantages apply here:
The ownership and responsibility of cryptocurrency coins involves the following: Firstly, they are not easy to secure and protect from being hacked. They to be stored in a cold wallet; thereby, making it as difficult as possible for nefarious hackers to break in and steal your investment.
The most significant disadvantage of long-term digital currency investments is that the price is very volatile and there is a good chance that the coin price will drop sharply and never recover.
Therefore, investors run the risk of losing expensive investments. Consequently, it is better to trade in cryptocurrency CFDs.
Succinctly stated, a Contract for Difference (CFD) is an attractive form of derivative trading, and it is a contract between a client and a broker. Primarily, the CFD’s underlying asset is not purchased. A CFD is calculated based on the asset’s price movement between its opening and closing price. Finally, a CFD only takes the price change into account and not the actual value of the asset itself.
This allows traders to take advantage of a market with volatile, sharply moving prices. While CFD trading is inherently a high-risk venture, the traded amounts are much smaller than the purchase of one Bitcoin, for example.
Here at Jones Mutual, we provide a web-based user-friendly trading platform where you can use the versatility of cryptocurrency CFD trading to garner more significant profits. You can sign up for an account today, start learning to how to trade successfully, and finally jump straight into live CFD trading.
Start CFD Trading with Jones Mutual Today!