5 Reasons to Trade Cryptocurrencies on eToro
10/13/2017 4:30 am EST
The world of cryptocurrencies is constantly evolving, as a growing number of these innovative assets are introduced into circulation. As the market grows, it is safe to assume that they will raise interest with more investors, writes Shiran Herzberg of eToro.
(Sponsored content) The cryptocurrency market has had quite a breakout in 2017. While many people had heard about bitcoin in the past, few understood what it was and even fewer were familiar with the term cryptocurrency.
That all changed this year when this relatively new market skyrocketed to an overall cap of more than $150 billion and started being mentioned all the time in mainstream media. However, despite it becoming more popular than ever, this market is still out of reach for many traders and investors.
Buying and selling these digital coins often requires maneuvering between multiple digital wallets and currency exchanges. Moreover, there’s a lot of risk management and technical knowledge involved. Therefore, despite many cryptocurrencies rising by thousands of percentages in 2017, there are still quite a few entry barriers for investors wishing to get exposure to this market.
However, there is another way to invest in cryptocurrencies, using eToro’s online trading platform.
eToro is the world’s leading social trading community, with more than 7 million users worldwide. On the platform, users can trade and invest in multiple assets across various categories, including cryptocurrencies.
Here are 5 reasons to consider using it for your cryptocurrency trading needs:
1 - All of your assets in one place
One of the most frustrating aspects of investing in multiple cryptocurrencies has to do with the fact that not all exchanges carry all currencies. This means that investors often hold more than one exchange account, and need to alternate between them to move their funds around. On eToro, clients gain access to a selection of cryptocurrencies which they can manage, using one account on a single platform, and make trading decisions with the help of easy-to-use advanced analysis tools.
2 - No need for a digital wallet
Holding cryptocurrencies usually requires storing them in a digital wallet. This leaves the door open for many risks, including loss, theft and hacking. Most cryptocurrency security experts agree that your funds are only as safe as the machine you use to manage them, so traders often need to manage their own security and invest in various cyber defense methods. In contrast, on eToro your funds are kept in tier-one banks while the platform itself operates using state-of-the-art encryption technology, so your funds are safe and secure.
3 - Shorting the market
One of the most prominent characteristics of cryptocurrencies is their extreme volatility. However, on most traditional exchanges, traders can only gain when markets are going up. If the currency they’re holding increases in value, they can sell it for a profit. However, if its value goes down - there’s not much they can do. On eToro, clients can use CFD (Contract For Difference) trading to short-sell these assets. This means that there are potential profits to be made even if the crypto market is in a downward trend.
4 - Crypto CopyFund
Even with the relative ease of trading cryptocurrencies on eToro, managing a crypto-based portfolio still requires technical knowledge and risk-management skills. To enable more investors to receive access to this market, eToro created the Crypto CopyFund - a long-term investment instrument, which offers a ready-made portfolio of six cryptocurrencies. The Crypto CopyFund is managed by eToro’s investment committee and is optimized periodically to contain only the leading cryptocurrencies on the platform. One might argue that it is the simplest way available for investing in a basket of cryptocurrencies.
5 - No daily withdrawal limits
Imagine making great profits and not being able to withdraw them all at once. For many cryptocurrency traders, this is an everyday reality, since most exchanges impose a daily withdrawal limit. Within the cryptocurrency trading community, this is considered one of the greatest difficulties for investors. On eToro, on the other hand, there’s no daily withdrawal limit, and clients can withdraw as much or as little of their cash balance as they want at any given time.
The world of cryptocurrencies is constantly evolving, as a growing number of these innovative assets are introduced into circulation. As the market grows and additional mainstream institutions adopt, and adapt to these new currencies, it is safe to assume that they will raise interest with more investors. The crypto market already presents various investment opportunities, and those who wish to explore and invest in the market, should consider giving eToro a try.
All trading involves risk. Only risk capital you are prepared to lose. This is not investment advice. CFD trading.