Bitcoin (BTC) has gained widespread recognition over the past decade. While many are aware of its existence and potential for profit—similar to stock trading—few understand the practical steps to trade Bitcoin, often missing lucrative opportunities.
This guide will walk you through Bitcoin trading, covering platform selection, account setup, trading steps, and FAQs for beginners.
Bitcoin Trading Methods
Bitcoin trading primarily involves two approaches:
| Feature | Exchange Trading (On-Chain) | OTC Trading (Off-Chain) |
|---|---|---|
| Platform Type | Centralized exchanges (e.g., Binance) | Brokerage platforms (e.g., Mitrade) |
| Execution | Order-book matching | Direct peer-to-peer or broker-mediated |
| Instruments | Spot, futures, options | Spot, CFDs |
Key Differences:
– Exchange trading offers transparency but lacks flexibility.
– OTC trading provides tailored solutions but with less price visibility.
– New tokens often debut via OTC due to low initial liquidity.
Top 5 Bitcoin & Crypto Trading Platforms
1. Binance
Overview: The largest global crypto exchange, founded in 2017 and regulated by SFC, FCA, and others.
| Pros | Cons |
|---|---|
| High liquidity ($38B daily volume) | T+1 withdrawal delays |
| 350+ cryptocurrencies supported | Security breaches in past |
| Low fees (0.1%) with BNB discounts |
2. Coinbase
Overview: U.S.-based exchange launched in 2012, regulated by NYDFS and FCA.
| Pros | Cons |
|---|---|
| Strong liquidity ($1.3B daily) | No Chinese language/TWD support |
| 200+ cryptocurrencies | No derivatives trading |
3. IG
Overview: UK-based CFD platform since 1974, regulated by FCA and ASIC.
| Pros | Cons |
|---|---|
| Segregated client funds | Limited crypto leverage (5:1) |
| Publicly listed (LSE: IGG) | High minimum deposit ($300) |
4. OANDA
Overview: U.S. forex/crypto broker established in 1996, overseen by NFA and FCA.
| Pros | Cons |
|---|---|
| Stable trading systems | Slow withdrawals (up to 7 days) |
| Long-standing reputation | Inactivity fees |
5. Mitrade
Overview: Australian CFD platform launched in 2019, regulated by ASIC and CIMA.
| Pros | Cons |
|---|---|
| Zero commissions, tight spreads | Limited crypto selection (~40) |
| Fast TWD deposits/withdrawals | CFDs only (no spot trading) |
How to Open a Bitcoin Trading Account?
- Sign Up: Visit your chosen platform’s website (e.g., Mitrade) and click “Register.”
- Verify Identity: Submit required documents (e.g., passport) for compliance.
- Fund Account: Deposit via bank transfer, card, or crypto.
- Start Trading: Use a demo account to practice risk-free.
Step-by-Step Bitcoin Trading Guide
- Log In: Access your trading dashboard.
- Select BTC: Search for “BTC” and choose your trading pair (e.g., BTC/USD).
- Place Order:
- Market Order: Instant execution at current price.
- Limit Order: Set a target price for execution.
- Monitor & Close: Track positions and exit via “Sell” or take-profit/stop-loss orders.
Factors Influencing Bitcoin Prices
- External Factors:
- Macroeconomic trends (e.g., inflation, interest rates).
- Regulatory changes (e.g., ETF approvals).
-
Black swan events (e.g., exchange hacks).
-
Internal Factors:
- Trading psychology (fear/greed).
- Risk management (leverage, position sizing).
Bitcoin Trading FAQs
1. Which is better: exchange or OTC trading?
- Use exchanges for liquidity; OTC for flexibility or new tokens.
2. How much should I invest in BTC?
- Allocate ≤20% of disposable income due to volatility.
3. What leverage is safe for beginners?
- Stick to ≤10x leverage to minimize risks.
4. How to avoid common pitfalls?
- Avoid “all-in” bets. Start with 10% of capital and scale gradually.
👉 Explore Advanced Trading Strategies
Disclaimer: Trading cryptocurrencies involves high risk. Consult a financial advisor before investing.