As you know, cryptocurrency is a great way to invest money now, you can even make a profit after just a couple of days. However, what if we tell you that you can earn money on Bitcoin even when its price is falling?
As you know, cryptocurrency trading activity provides two ways to trade: spot and futures. In this guide, we will focus on the second, in particular, dealing with cryptocurrency futures.
As for classic trading style, we mean spot, everything is simple, but futures point to the more advanced level, about which we will talk today. Let’s discover the pros and cons of cryptocurrency futures trading and compare it to the spot market.
Before reading this article, ask yourself if you are ready for futures trading?
Check out the info below to get familiar with the process of futures trading and why it is not recommended for newbies to trade crypto this way.
What is a futures contract? A futures contract is a legal agreement to buy or sell a particular commodity asset or security at a predetermined price and at a particular time in the future. Futures contracts are standardized for quality and quantity to facilitate trading on a crypto futures exchange.
With cryptocurrency futures, you are trading derivatives. These are contracts based on the value of an underlying asset, in this case, of crypto tokens. These traders will be opening trades to buy or sell a contract at a particular time in the future and a predicted price.
The cryptocurrency futures market also provides an opportunity for users to increase their deposits to the market by using leverage. Users can trade with margin and increase their earnings if their price prediction is true.
The spot market is an area where you can earn your money on currency price changes. It is simple – buy when everything is falling, sell when everything is reaching its tops. In simple terms, it is the underlying market where bitcoins are exchanged.
Features of the spot market:
How does the futures market work? Loosely speaking, you invest in your price predictions, and your reward is based on your accuracy. How can we describe the cryptocurrency futures market?
You can always trade like a king everywhere with proven trading signals. Being armed with the correct cryptocurrency signals will allow you to feel like a king even during the bear run when the whole market crashes.
How to determine a proven service? Don’t be shy and ask for the statistics and trade results. Don’t trust empty promises, believe only numbers.
Will crypto signals make you rich? It is entirely possible, but remember to trade wisely and do not be greedy.
Finally, we want to summarize that cryptocurrency futures trading deserves attention. Despite its disadvantages, it can be very profitable when traded correctly.
Also, we want to repeat that you should be ready for futures trading, otherwise you will burn all your deposits, which will demotivate you from trading activity. You will only become successful if it brings you joy.