Being the world’s first cryptocurrency, many people view bitcoin as the most likely contender for challenging traditional currencies. Bitcoin has had quite a valuable history, although it has also experienced a lot of volatility over the years.
Only 21 million bitcoin that will ever be mined. There are two ways one may trade in bitcoin.
- Buying the cryptocurrency itself in the hope of selling it at a profit later on.
- Speculating in its value without ever owning the cryptocurrency
A stock in Bitcoin is a fraction or a small piece of the whole market capitalization. Investors can, therefore, trade-in stock on cryptocurrencies. They can, however, only do so at properly licensed exchanges.
The bitcoin stock initial is BTC or sometimes XBT. The Bitcoin stock ticker symbol is Ƀ. The term ‘bitcoin stock’ is often confused with ‘stock in bitcoin.’
Bitcoin stock refers to the value of bitcoin in terms of the number of shares of ownership that are currently on the market, whereas having stock in bitcoin means that one actually can store, send or receive bitcoin using a bitcoin wallet.
Bitcoin stock is not REAL bitcoin, it is just a contract issued to you by the platform you chose to buy the bitcoin stock. WE HIGHLY RECOMMEND buying an actual bitcoin on Binance, Kraken or KuCoin as the whole point of crypto is sovereign ownership of your money with no third party involvement.
This article will be a guide to all you need to know about Bitcoin Stock and where to trade it.
To learn more about how you can buy actual bitcoin, read the guides below:
- How to buy Bitcoin anonymously
- How to buy Bitcoin with credit card
- How to buy Bitcoin with gift card
- How to buy Bitcoin with prepaid cards
- How to buy Bitcoin with iTunes gift card
- How to buy bitcoin with VISA Gift Card?
- How to buy bitcoin with Skrill
- How to buy bitcoin with eCheck
- How to buy bitcoin & crypto with Google Pay
- How buy bitcoin as a minor?
- Can you buy a fraction of bitcoin?
Where to Trade in Bitcoin Stock
A bitcoin stock exchange is a platform in which investors can access the price of the stock in real-time and also freely trade bitcoin for other traditional currencies (e.g., USD, Euro, etc.) or even virtual currencies. Clients must, therefore, sign up on verified stock exchange platforms to gain access to their trading tools. Some of these platforms include IQ Options, Plus500, Etoro, and AxiTrader. Stock exchange platforms are divided into three, namely:
- Trading platforms – These types of exchange platforms connect buyers and sellers and charge a percentage commission for every transaction made.
- Direct Trading – these types of platforms provide a direct person to person platform. The platforms, however, typically lack fixed market prices, and each of the sellers has their cost.
- Brokers – in this type of platform, the brokers set the prices.
Bitcoin stock has been gaining increased popularity in recent years. The United Kingdom, Asia, and Australia are some of the countries enjoying this gain in popularity.
For residents of the United States, Bitcoin stock can only be traded at certified stock exchanges. The brokerage firm must also trade in real currencies as the Trading in forex and derivatives is illegal in the United States. Etoro is one example of such a platform.
There are several factors one should consider when choosing a site to trade bitcoin stock. Below is a list of what you make look for when choosing a site that will work best for you:
- Payment methods – various sites have different deposit and withdrawal options. One should, therefore, check to see the platform that offers the payment options that are convenient for you.
- Charges incurred – Charges incurred in the various platforms for transactions such as deposits, withdrawals, and other transactions vary. It is, therefore, essential that one counter-checks the different charges to choose the site that is best for you and also to avoid hidden costs.
- The reputation of the platform – One can check out reviews of various platforms to see what other users think of the same platform. This is one sure way of checking whether they are reliable.
- Verification requirements – Most sites have some form of the verification process to avoid fraud. Check to see the site that provides verification methods that work for you.
- Geographic location – Some platforms only work in specific countries. Check and see the available options in your area code.
- Exchange rates – The exchange rates are different across various platforms. Shop around and find the sites with the best market rates available.
Best Bitcoin Stock Platforms
The following is a list of reputable bitcoin stock trading platforms:
How to Buy Bitcoin Stock
To buy Bitcoin Stock, choose a stock exchange that works for you, such as Plus500 or Etoro, and follow these steps:
- Create a user account on eToro.
- Verify your identity
- Connect your payment methods
- fund your trading account
- select bitcoin stock and select the amount you wish to spend
- confirm the transaction
Being able to make a purchase and a sale of the bitcoin shares is very important in determining your success at this trade. Essentially, one needs to buy the stock when it is at a relatively low price and sell it later when the price rises to generate profit. Some traders buy and hold their stock for long periods, and some may opt to trade at shorter intervals. One very effective way to trade is timing trades at the price one wants.
For one to trade in bitcoin, they must be at least eighteen years old.
Bitcoin Stock trading strategies
If you want to respond to short term opportunities that come up in the bitcoin market, such as emerging news, emerging patterns, and others, day trading would be a good option. Choose a stand based on the trends and information and closeout at the end of the trading day.
Swing trading, on the other hand, is the best strategy for one who wants to capitalize on the opportunities that present themselves from the market momentum. One will essentially catch specific trends as they begin to form, hold on to that stand and capitalize on them till they run out.
Scalping is another popular strategy. This involves placing frequent intraday trades on the minor price adjustments that will occur. This is the strategy for someone who wants to make small continuous profits rather than wait for a significant change.
Automated Trading is another very effective strategy. In this strategy, one automates their trading process to react in specific ways to market conditions. This is effective, especially for people who trade passively.
Creating a Trading Plan
Once you choose a strategy that will work best for you, you must consider creating a trading plan also. This will be very helpful in making rational and objective decisions, even when the stakes are high. It will essentially stop you from leaving trades open for too long or closing them too early. The following are some steps to creating an effective trading plan;
- Decide what you wish to achieve from Trading, both in the long-term and in the short-term.
- Choose an acceptable risk you are willing to take in each trade, as well as in total.
- Decide a risk-reward ratio that you are comfortable with. This will also help you identify the profit you need to justify potential losses.
- Choose the market you want to trade-in.
- Research on the recent trends and news about the market you have chosen.
What causes changes in the price of Bitcoin Stock?
The volatility of bitcoin makes it an attractive opportunity. However, it also makes it a precarious business endeavor. The prices can shift rapidly and suddenly, and this can happen at any time of day. Since it is a decentralized currency, bitcoin may be free from certain economic and political factors that affect traditional fiat currencies. However, since the coin is still in its adolescence period, it also suffers uncertainty that is unique to cryptocurrencies. Some of these include:
- Bitcoin Supply – Although there may be a finite amount of bitcoins all expected to be mined by 2040, their availability depends on the rate with which they enter the market and also the activities of those who hold on to them.
- BTC Market Cap – The value of the entire bitcoin market and the public’s perception of the importance both affect the price.
- Press – the public portrayal and the perception affect the prices just like any other commodity.
- Key Events – Key events such as security concerns, regulations, policies, and economic factors may affect the prices.
- Industry adoption – Bitcoin’s adoption into the world also affects its price.
- Integration – Bitcoin’s profile is dependent on its adoption into new payment systems and crowdfunding platforms.
CaptainAltcoin's writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of CaptainAltcoin.com