OKEx introduces new margin trading pairs – XRP/BTC & LTC/BTC

OKEx one of the most trusted digital asset exchange on Tuesday i.e. 06 Nov introduced new margin trading pairs XRP/BTC & LTC/BTC for their valuable customers.  As per the official announcement made on their website and twitter account –

To meet the public demand , we will open the margin trading pairs XRP/BTC、LTC/BTC from 15:00 Nov 6, 2018 (HKT).

They also reiterated that margin trading involves risks and hence need to carefully evaluated before making investments.

Read more here okex support

Japan’s Financial Services Agency limiting caps on Crypto Margin Trading?

Japan’s regulators are considering stricter limits on margin trading of digital currency as reported by Nikkei. To curb speculative trading and limit user exposure to volatility risks, Japan’s Financial Services Agency is considering leverage caps for margin trading of cryptocurrencies.

The push to regulate came in response to concerns by many users. With a theft with Coincheck early this year FSA received a lot of inquiries, and this move is just to reduce risks and improve user protection.

Read more at Asia.nikkei.

dYdX raised $10 Million to help you short Ethereum

A crypto startup dYdX raised $10 million from investors to design and develop a sowaftre that assist individuals to borrow money from each other without a broker. The firm has developed a margin trading protocol that is based on the computing network Ethereum. The prime motive is to provide a platform to individuals to create new cryptocurrency-related financial products, like interest-generating loans, short sells, or leveraged long positions.

The team is set to launch more assets that includes a long leveraged Ethereum token, that is designed to amplify the gains/losses of traders trading on margin. The team is also planning to add newer assets in future depending on their liquidity such as native coin of 0x or the ZRX token.

Read more at fortune

How and Where to Margin Trade Bitcoin?

The world is divided, while some support crypto Margin trading to be a blessing, few others are against it. In spite of the clash, speculators and investors are investing and making a fortune and others who are losing it. Which side are you at? Until you make up your mind, how about knowing How to Margin Trade Bitcoin? Exchanges that support Bitcoin Margin Trading?

Let’s get started –

How To Margin Trade Bitcoin?

Margin Trading – a process of borrowing money from an exchange/broker to fund a large amount of investment. While in our last post we described adopting to stop loss would be a good idea, make sure to follow other Crypto Margin Trading Tips as well.

The Margin Trading concept, when applied to Bitcoin, is known as Bitcoin Margin Trade. So for example –

The current price of Bitcoin is $600, and as an investor, you are expecting the price to grow.

To make a profit, you are willing to buy Bitcoin now and sell them later at a higher price.

Balance $300
Borrowed money $300
Leverage 1:2 leverage
Closing Position when the price hits $800 $300 of balance is returned.
Profit earned ~$200 [ $800 – $300 – $300] fees not included.

 

Exchanges to Margin Trade Bitcoin

BitMEX

BitMEX or Bitcoin Mercantile Exchange is a peer-to-peer trading platform that also offers leveraged contracts that are bought and sold in Bitcoin. At BitMEX you would find crypto derivative instruments being sold and bought on margin trade.

BitMEX, the only exchange in the market that could provide 100x leverage, i.e., for every BTC/XBT you own, you can trade as if you have 100 BTC/XBT. You can also trade Bitcoin Cash at 20x leverage. It’s worth noting that BitMEX only accepts BTC deposits and no other currency, even the profit and loss are in BTC.

To start off trading on BitMEX you can register here.  You just need your email to set up and could secure your wallet using two-factor authentication. Bitmex is very high risk or high reward ether leverage trading; please trade cautiously knowing the risks.

Cex.io

If you are looking to invest a large sum of money, CEX.io is a decent place to start with crypto margin trading. It offers Bitcoin, Ethereum and Bitcoin Cash margin trade with 3x leverage. Providing services across the globe, they accept Visa, Mastercard, bank transfer and cryptocurrency payments.

To start off, you can register here, and once the account is verified, you may start trading.

Kraken

Kraken, one of the largest Bitcoin and altcoin exchanges in the USA offers crypto margin trading with the advantage of different leverage options for different pairs. Check here different currency pairings that could be traded on margin using leveraged orders.

To start off, investors can register on their website using the email id, that follows with KYC verification. Usually, it takes up to 7-10 days to get the verification completed.

How and Where to Margin Trade Ethereum?

Crypto Margin Trading offers traders with access to borrow the capital and make a purchase of a larger volume of cryptos. In case of margin Trading Ether, the investor lends money/crypto to access Ether of larger volume. Our post of today will talk about how and where you can Margin Trade Ethereum. Let’s get started –

How to Margin Trade Ethereum?

Margin Trading Ethereum means to borrow capital from a lender or Exchange to purchase a larger volume of ether. The amount that is borrowed is the “initial margin” and predefined by the exchange and could vary with each platform. Many traders find margin trade as lucrative trade. However, even risks are considerable and hence practice cautiously.  To limit traders from borrowing too much, the margins are limited called as maintenance requirement.

Let’s pick an example –

Anthony wishes to margin trade on Ethereum.

So,

Amount Deposited as maintenance requirement $5000
Borrowed money $5000
Purchasing Ether worth of         $10000
Initial Margin set 25% i.e. value of the purchased Ether drops to $8,000, Anthony would need at least $2,000 (25% of $8,000) in equity
Total Equity with Anthony $3000 [$5000 -$2000]

With a price drop such that it results in total equity with Anthony less than $3000, margin call would be initiated. That means either Anthony needs to top up to maintain the maintenance requirement or the exchange would sell off his Ether to bring the account back up to the maintenance requirement.

 

Exchanges to Margin Trade Ethereum

Here are some of the exchanges that allow traders to Margin Trade on Ether.

Bitfinex

Bitfinex, founded in 2012 is a cryptocurrency trading platform that has its headquarters in Hong Kong and registered in the British Virgin Islands. The exchange facilitates spot trading for most of the digital assets like Bitcoin, Ethereum, EOS, Litecoin, Ripple, NEO, Monero and many more. They also offer Margin Trading through their peer-to-peer margin funding network allowing traders to securely trade with up to 3.3x leverage.

Individuals interested in Margin Trading can visit here. The traders have two option, either they can enter an order to borrow the desired amount of funding at the rate and duration of their choice, or they can simply open a position and Bitfinex will take out funding for them at the best available rate at that time.

Bitfinex now support leverage trading Ethereum Classic in ETCUSD and ETCBTC markets

BitMex

BitMEX or Bitcoin Mercantile Exchange is a peer-to-peer trading platform that also offers leveraged contracts that are bought and sold in Bitcoin. At BitMEX you would find crypto derivative instruments being sold and bought on margin trade.

BitMEX, the only exchange in the market that could provide 100x leverage, i.e., for every BTC/XBT you own, you can trade as if you have 100 BTC/XBT. However, perpetual Ether contracts can be leveraged up to 33x. It’s worth noting that BitMEX only accepts BTC deposits and no other currency, even the profit and loss are in BTC.

To start off trading on BitMEX you can register here.  You just need your email to set up and could secure your wallet using two-factor authentication. Bitmex is very high risk or high reward ether leverage trading; please trade cautiously knowing the risks.

References

Wikipedia, Bitfinex, Coinsutra, BitcoinDaily, Ethereumprice, MarginTradingBitcoin.

Cobinhood, New Tokens Added with Margin Trading and Funding

Cobinhood exchange – that charges no fees for trading have planned to add new tokens XRP and NEM to expand the reach of their services. The exchange has also added a benefit of margin trading and funding with Ethereum (ETH), Cobinhood Coin (COB), and Bitcoin (BTC). The announcement was made on Twitter.

The new cryptocurrency trading features would be launched on the platform on October 19th, allowing users to maximize their crypto assets.

Cobinhood recently made cryptocurrency headlines for receiving the Red Dot Award: Communication Design in 2018. They are the first crypto-related business to win this accolade, establishing a historical difference in the industry.

Read more at bitcoinexchangeguide

Image Courtesy – cryptocurrencynews.com

Five Crypto Margin Trading Tips Investor Should Know

Margin Trading is a risky venture if not played responsibly you may lose more than you invested. But then how come individuals make a fortune out of it? While few of the investors argue that you have to compete against a bot to make profits, others recommend to sail cautiously, and be the turtle while trading, so whom to follow and whom to not?

Our today’s post would narrate some of the tips and tricks to follow while executing a cryptocurrency margin trade. Let’s get started –

Crypto Margin Trading Tip # 1

Start With Small Amount

It’s a good idea for a beginner to start with a small amount to minimize risks, by using a low level of leverage and avoiding using up of funds in one transaction. Crypto Margin Trade showcase a significant probability of “High Returns” but unless you know the nitty-gritty of the market, the technical indicators, the workflow, how to open and close margin positions, what are margin ratios and calls or even different margin trading strategy you may not be able to boost your returns.

Starting small help in experimenting and exploring the domain, and once you master the art of trading, you can expand your reach, adding more funds to your portfolio and receive success.

Crypto Margin Trading Tip # 2

Follow news and learn to decipher it

Crypto Market is highly volatile, till 2017 the price of Bitcoin reached till 20,000 and 2018 has seen a significant dip. All these price fluctuations have been influenced by some of the other events happening around the world, just for example when SEC rejected the ETF’s proposal or when China put a pause to Token Trading. As an investor interested in crypto margin trading you should know when to buy the rumor and when to sell the news. Striking the chord at the right time would make all the difference and make you a gainer or loser. So watch out the events and make smart decisions.

Crypto Margin Trading Tip # 3

Manage Risk

One of the critical parts of managing risk with crypto margin trade is minimizing your loss. You may want to opt for a Stop loss order, so if you bought bitcoin at $9,000, you could set a stop loss order at $7,500. It would help in limiting your loss to $1,500. But again sail cautiously while using stop-loss as if you set a price too close to buying price, you may lose and put a stop occur before any profit is seen. Or if you select a broader range that could also result in substantial losses. Again learning and knowing the details about when and how to opt for the strategy would be a great help.

Crypto Margin Trading Tip # 4

Access online and Offline storage

Do not put all your eggs in one basket that simply means if you have a lot of cryptocurrency use online and offline wallets to protect them from hacking. Storing the significant cryptos in an offline wallet or cold storage is less risky and could help protect yours from unauthorized access of digital currencies.

Crypto Margin Trading Tip # 5

Spread buying options and platforms

Spread your wings that merely means spread out your buying options, i.e., in a matter of weeks or days. It helps in allowing you to analyze what is working and what isn’t and lowers the risk in case an investment turns against your expectations. Additionally, it provides you time to adjust to the new domain.

Even picking different platforms/exchanges would be a good idea to explore and analyze how and where you can maximize your returns.

While crypto margin trade involves adventure and excitement, it has its downtime as well. All you need to apply is caution, intelligence and baby steps.

 

References

Bitcoinexchangeguide, Finder, cryptocurrencyfacts

Crypto Margin Trading – Is it Profitable?

The traditional method of trading cryptos i.e. buy and sell digital currencies in an exchange using your own fund has been in place for some time. But Crypto Margin Trading has been a new concept that is picking its pace with more platforms/exchanges offering the trade and  traders keen to explore it.

The major difference between a margin trade and regular trade is that in former  the individual could borrow money from an exchange to boost his buying power and opening gates to higher gains/losses. On the other hand the regular trade an investor buys coins/tokens at the market price and holds it until the price shoots up, either over the long or short term to sell them for a profit.

While regular trade sounds like a simple concept with sure shot profit, margin trading is riskier and need lots of research and intelligence to gain profits. Are Crypto Margin Trades anytime profitable? Lets have a closer look –

Crypto Margin Trading – Is it Profitable?

Margin Trading is based on the power to leverage. While lenders play safe and lend you the money to trade, the traders/investors use that money to open positions in the market. Many investors consider it a double sword game as a trader need to pay the interest on the amount borrowed and also in case drop in the market, there is a risk of margin call.

However, with all this some experts love Margin Trading and earn profit as well. Here are few considerations an investor should bear in mind before approaching for a margin trade.

 

Availability of Margin for  Trading

The whole game is based on margin, and is directly proportional to your gains or losses. While the average leverage is about 3:1, other platforms and exchanges offer 2:1, 4:1, 5:1, 3:33:1 or even 1000:1. Lets pick an example –

So you are planning to buy $10,000 worth of Bitcoin

With borrowing 50% Or leveraging 2:1 or 2x

Then you would only need $5000 to purchase a bitcoin worth $10,000.

So while the purchasing power is 1/2  and deal seems profitable, consider when the prices fall and there is a risk of margin call.

Interest Rates Applied on the borrowed amount

Continuing with the same example above, if the amount $5000 that you borrowed has a very high interest rate then it wouldn’t sum up to be  a profitable trade, so choose a lender/exchange with nominal interest rates. In crypto margin trading the interest rates are calculated on daily basis, and with price fluctuating you need to top up your account to avoid lender from credit risk, in case market is going steep down. So make sure to account for the interest rates so as to know the amount exactly you need to pay back to the exchange.

Value of Crypto

The value of cryptos is different in each country and is never pegged to USD or any other fiat currency. However the price is still determined in a fiat used by a specific country. Just for example if you search Bitcoin price on Google, it might return in USD as it takes the price from Coinbase API that provides results in USD.

So in Crypto margin trading an investors profit/loss is calculated with respect to the underlying coin i.e usually Bitcoin. So if you are trading a pair of ETC/BTC, so the price movement is not only based on the coin you have invested in but also the price fluctuations of the crypto that it is based on.

 

References – Ambcrypto, Investopedia

Top Five Crypto Exchanges for Margin Trading

Cryptocurrency exchanges are the web portal that facilitates buying, selling and exchange of cryptocurrencies for other digital currencies or Fiat like USD or Euro. One of the trading strategy widely adopted by veteran traders is Margin Trading. If you are new to Margin Trading and keen to explore the pros and cons, please refer to our previous post. Margin Trading – Everything you need to know and Pros and Cons of Margin Trading.

Our post of today would explore the Cryptocurrency exchanges that allow Margin Trading. Let’s get started –

Top Five Crypto Exchanges for Margin Trading

The listing is based on Coin Market Cap, Top 100 Cryptocurrency Exchanges by Trade Volume. But here the list is exclusive of exchange’s that offer Margin Trading.

OKEx

OKex exchange offers crypto-to-crypto trading and fiat to crypto trading as well. The exchange also offers Margin Trading with a maximum of 20:1 leverage available. Due to the volatile nature, margin trading is limited to 20:1 in crypto markets.

In April, OKex announced adding seven new trading pairs for margin trading, which were –

  • BCH/USDT
  • LTC/USDT
  • ETH/USDT
  • ETC/USDT
  • ETC/BTC
  • IOST/BTC
  • QTUM/BTC

And, just last month in September they introduced EOS tokens on Margin, adding new pairs –

  • EOS/UDST
  • EOS/BTC

Talking about How Margin Trading works on OKex, an individual can buy tokens from OKex, executing positions with three times of his capital. While your potential gain is maximized, so would be your potential loss.

 

Huobi Pro

Huobi Pro, headquartered in Singapore is an international crypto trading exchange is known for its multi-language support and platform. To start trading on Huobi, you need to register with your email ID and submit the documents for KYC; the whole process may take a day or two. Once you have registered successfully, you can enjoy the Margin Trading feature that allows your trade several cryptocurrencies pairs. The platform offers leverage up to 5X in BTC and BCH, LTC, ETH, EOS, OMG, XRP are some of the pair available for BTC.

 

Hitbtc

HitBTC, an exchange based in Estonia has been into operation since 2013. On June 2, 2018, HitBTC launched Margin Trading. In their official blog

HitBTC is launching a dedicated service for margin trading in collaboration with our partner Weltrade.

With this service you will be able to use leverage 1:3, margin trade at HitBTC at any moment, open long or short positions and withdraw money in just 30 minutes 24/7.

To initiate trading, one could visit here, fill the form, open the account, fund it, download the platform and Start Trading.

Bibox

Bibox, an AI-based digital asset exchange that offers a secure, stable and credible exchange service for digital assets such as BTC, ETH,BIX,NEO, EOS. They added Margin Trading support in April 2018. In an official release on the web page they mentioned –

Bibox will open margin trading at 14:00 April 18 (Beijing time) and trading pairs ETH/USDT, BTC/USDT will be included; You can log on the web or PC client to operate, and the feature will be added to the app soon. More pairs will be listed gradually.

Bitfinex

Bitfinex, one of the oldest exchanges in the cryptosphere has been operational from Hing Kong since the year 2014 and serves countries like Bosnia and Herzegovina, Democratic People’s Republic of Korea (North Korea), Ethiopia, Iran, Iraq, Syria, Uganda, Vanuatu, and Yemen.

To get started you would need to register, verify your ID along with the KYC formalities. The whole process could take up to 15-20 days before you could think of login into the platform.

The platform allows an individual to margin trade and get leverage of up to 3.33x.

Our next post would talk about Crypto Margin Trading – is it profitable? Stay tuned.

References

Medium, OKEX Support, Hypes codes, hitbtc, bitcointradingsites, bibox, bibox

 

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