It is widely known that cryptocurrencies have surged incredibly in recent years, leaving many traders wondering whether they should keep their eyes on trading Gold 2.0. instead of the Forex market or do their utmost in both profitable spheres. In this article, we will delve into the peculiarities of both bourses, evaluating their perks and commercial viability.
Cryptocurrency and Forex Markets: Where is the Point of Contact?
In both cases, you need a trading portfolio and a cutting-edge electronic device with a high-speed internet connection to savor your trading journey. Undoubtedly, if you would like to climb to the moon in the currency exchange market, you should learn the basics of cryptocurrency trading and vice versa.
Charts are widely available and trades are executed quickly, allowing you to focus on cash activities. Like forex, the cryptocurrency market is determined by the balance between supply and demand. Therefore, you can use well-known chart patterns to trade digital cash. Although cryptocurrency trading is very similar to Forex trading, there are some discrepancies between the two, which are put into words below.
Number of Available Tools
In the currency exchange market, traders usually focus on the major quotations (ex. EUR/USD, USD/USD, and USD/JPY) Some brokers prefer to trade unheard-of currency pairs, including national banknotes of newly emerging markets such as South Africa and Mexico. It is worth noting that you exchange one currency for another at the same time since this is the nature of the currency exchange market. Simply put, a currency pair is two currencies that are "paired" together with the value of one type of note expressed in terms of the other.
In total, there are about 11,000 existing cryptocurrencies and this number keeps growing at the speed of light. While some cryptocurrencies, such as Bitcoin and Ethereum, are strenuously on trade, a huge bulk of cryptocurrencies are familiar only to market geeks. It is better to be safe than sorry, that is why traders have to select from a restricted number of peer-to-peer money, so traders still cooperate with a limited list.
Key Platforms
It is common knowledge that Forex is available through brokers. Therefore, you have to interact with brokers and pay them a fee for services. The size of fees depends on current market conditions, selected currency pairs, bidders, and many other parameters.
As for cryptocurrencies, they are mainly traded on centralized exchanges. In fact, the stock exchange serves as the same mediator during the auction, So there are no unnecessary fluctuations throughout the trading process. It is either the exchange of terms that satisfy both parties or not.
Opening hours
The stock exchange operates at strictly set times and only on weekdays. On weekends and holidays, it is impossible to make transactions with securities. It is also necessary to take into account the presence of global trading times.
Activities related to digital currency are possible at any time of the day or night not only on weekdays but also on weekends and holidays. This is the advantage of a cryptocurrency exchange over a stock exchange. For instance, in this Justmarkets article, the best times to trade in South Africa are pointed out.