Crypto VS Forex, Friends or Foes:
Although crypto trading may seem similar to Forex, it’s quite different. While crypto trading refers to trading the crypto currency like Bitcoins, Forex refers to the Foreign Exchange Market, whichis used to exchange currencies. There are no government regulations applied on crypto trading and it aims at decentralizing the entire monetary system. However, Forex is monitored by government bodies and follow the currency exchange rules laid down by the Governments of several countries.
However, both the trading follows the same principle of currency exchange. In Forex trading, people buy different currencies and exchange them based on the volatile prices of currencies. If the currency they are selling has got a higher value on the current date, they make a profit. The same way in the case of crypto trading, the value of the bitcoin in exchange for any currency is volatile and people trade based on this changing nature. Buying and selling bitcoins are done based on the price of bitcoin going low or high at a given time. For more info, visit linkhttps://freebitco.in.
Comparison of Forex and Bitcoin:
|Central banks control regulation of currency available for exchange in Forex.||An exponential algorithm controls regulation of cryptocurrency exchange as per inflation.|
|There is no such limit on the currency exchange as the government can create fiat currency in case of monetary inflation.||Bitcoin’s algorithm allows mining of only maximum 21 million bitcoins.|
|The demand of the currency is constant and consistent.||The demand for the cryptocurrency varies as per the public adoption and confidence in the currency and as per marketplace emergence.|
|The government can regulate the usage and demand of foreign currency.||There is no control or monitoring of government on the usage of cryptocurrency.|
|Volatility of Forex currency varies between 0.5-1%||The volatility of bitcoins varies between 5-15%, on an average 10%.|
|There are multiple trading platforms and even bots for Forex trading, but they do not offer numerous crypto currency options. A few are regulated by Forex rules are used.||There are multiple trading platforms and bots for bitcoins also. However,a few websites may accept a few real currencies like USD and EUR. This may limit trading by other countries.|
|This is considered less risky.||This is considered riskier due to its volatile nature.|
Although Forex and Crypto both seem to be using same principles, they can be considered foes as the latter one is beyond government control and hence, goes against Forex too. With bitcoins, you can trade with a lesser number of clients and capital amount. However, if you’re looking to Forex, it’s advisable to start with a bigger capital when you have a big list of clients. Only then will you be able to make a good profit in Forex.
As there are a handful of people dominating the crypto market, most people prefer Forex over crypto. In addition, crypto trading of bitcoins and altcoins is a relatively new trade as compared to forex so it involves higher risk and leverage.