Cryptocurrency trading||Meaning and types
Cryptocurrency trading
In the business world, we already know that trading is the purchase and selling of various goods and services in exchange for money. So it is in the crypto world, we can say that crypto trading is the buying and selling of cryptocurrency in exchange for other cryptos and this action is usually done in exchange platforms. These exchange platforms can either be centralized or decentralised.
Just like in normal business trading, trading cryptocurrencies also come with either profit or loss.
Crypto traders take advantage of price decrease to purchase the crypto assets and then resell it when the price s high. That way they make meaningful profits.
Platforms used for trading cryptocurrencies
As I mentioned earlier, there are platforms used for trading cryptocurrencies. They are known as Exchange platforms.
Crypto trading platforms can be defined as digital market places whereby different crypto assets are exchanged for another in order to make profit. These exchange platforms are either centralized or decentralised.
There are many exchange platforms used for trading cryptocurrencies. Below are just a few of them:
Binance
Coinmama
Crypto.com
BLOCKFI
eToro
Binance
Binance is one of the world's most popular exchange platform. It is a decentralized exchange platform and it offers more than 150 coins for exchange.
Binance exchange is made available for both individuals and institutions and it guarantees fast and secure transactions. This exchange platform is also user friendly as it accommodates different languages.
Spot crypto trading
Spot crypto trading is the buying and selling of crypto assets at a spot price through a spot trading platform. It is done so for immediate settlement or instantaneous effect.
Order types
Market order
In this type of order, the crypto trader decides to buy and sell cryptocurrency at its current trading price, this order is filled instantly, when the price of the coin equals with the market price.
Limit order
In this type of order, the trader sets his own price to buy or sell. If the market price reaches the limit price then the trader's order will be executed. But if the market doesn't reach the limit order, it means that the order will not be executed.
Order book
The order book is a list that contains all transactions/orders (buy/sell) that has been made by crypto crypto traders in the crypto market. The list also reveals the prices in which the traders have placed their individual orders.
Trading pair
Trading pair is the pairing of two cryptos for the sake of exchanging one for another. This means that once the coins are paired , a trader can buy one of the cryptos for the other pair