Cryptocurrencies are the most exciting, volatile, and nonsensical asset class ever to exist. The cryptocurrency market is entirely unregulated and controlled predominantly by the reactions and mass psychology of retail speculators.
For experienced traders only, the ExpressOptions Cryptocurrency offering allows traders to go long or short using a CFD. This means traders do not need to actually hold cryptocurrency and be exposed to all of the risks with doing so – hacking, theft, counterparty risk from the exchange, etc.
Trading Cryptocurrencies with ExpressOptions is like trading FX, however, instead of buying or selling an amount of base currency against a counter currency, you are buying or selling a number of units of a Cryptocurrency against the US dollar. For example, one contract of XRPUSD is 100 ‘Ripple’ coins while one contract of BTCUSD is 1 Bitcoin. Cryptocurrencies trade almost 24/5, have overnight financing and do not expire.
Cryptocurrency CFDs work in an almost identical way to buying the actual Cryptocurrency from a crypto exchange. The key differences being the leverage involved (if any), your counterparty risk on the trade being ExpressOptions and not the crypto exchange, and that you own the CFD and not the underlying Cryptocurrency. Eliminating the risk of hacking, theft, counterparty risk from the exchange, etc. is the main reason a trader would use a Cryptocurrency CFD over going to an exchange.
The gross profit on your rate is calculated as follows:
1 BTCUSD x 10,499 = 10,499 USD
10,499 USD x 100% = 10,499 USD
1 BTCUSD x 8,905.00 = 8,905.00 USD
$1,594.00 USD
The price of the Bitcoin (BTCUSD) CFD against the US Dollar is 10,499 bid /10,522 ask. You would like to sell 1 BTCUSD coin at 10,499 bid price. (1 lot = 1 cryptocurrency coin, except for XRPUSD which is 100 crypto currency).
You have 40,000 AUD balance and the leverage is 1:1
Two months later, Bitcoin CFD has decreased to an ask price of 8,905.00 USD. Since you took a short position, you are in profit and would like to take your profit by closing the position at 8,905.00 USD ask price.
View our trading conditions across our full range of products to see how trading with ExpressOptions is your next best move.
Instrument |
BCHUSD | BTCUSD | ETHUSD | LTCUSD | XRPUSD |
Minimum Spread |
9.88 | 18.32 | 1.01 | 1.01 | 0.12 |
Average Spread |
16.11 | 22.29 | 1.32 | 1.1 | 0.13 |
Disclaimer: Spreads from ‘Trade Proofer’ monthly spread data September 2019 report.
46 FX, 6 Commodities, 10 Indices, 5 Crypto
Individual, Joint, Corporate and Trust accounts
7 AUD, 7 USD, 6.2 EUR, 5.4 GBP, 9.5 SGD, 9 CAD
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