Crypto trading Canada is gradually gaining popularity as investors seeking new opportunities divert cash into buying and selling cryptocurrencies over the internet. Since the invention of Blockchain technology in 2009, the global value of cryptocurrencies has crossed the $100 billion mark and is still growing. Despite the volatile nature of crypto assets, many Canadians still enjoy investing in them.
Crypto Trading simply means trading cryptocurrencies by taking a position on the price direction of a digital asset against the dollar or other digital asset. Another trading technique is Contract For Difference (CFD) which allows for greater flexibility. Traders that trade CFDs enjoy greater flexibility by using leverage to go short or long, depending on their trading strategy and the current state of the crypto market.
Over the last ten years, cryptocurrencies or digital assets, as they are fondly called, have been growing in popularity with the introduction of Bitcoin. The rise of peer-to-peer platforms and Blockchain security has also increased confidence among Canadians, who now invest a significant part of their resources into digital assets.
Although these assets are not recognized as legal tenders in Canada or other parts of the world, their potential to change the financial landscape in the nearest future remains a huge possibility.
If you scan the internet for crypto trading platforms, you will come across hundreds of currencies traded on different platforms, but most of them don’t attract too much investment attention, unlike a few. Canadians who trade cryptocurrencies invest a lot of money into a few coins while a smaller amount goes into other coins. Below, we review some of Canada’s most popular crypto assets.
Bitcoin is the foundational coin upon which other currencies are built. It was launched in 2008, the first cryptocurrency ever introduced and the first asset to use Blockchain technology. Today, it is the most valuable digital asset in the world and influences the price of other assets. Many people who engage in crypto trading Canada buy and sell Bitcoin because it’s even more valuable than gold.
Another popular cryptocurrency among crypto traders in Canada is Bitcoin Cash. It was released in August 2017 to aid the release of larger blocks that the initial blockchain technology could not handle. Bitcoin Cash allows for a faster transaction which is why many Canadian crypto traders prefer it.
Ethereum is a popular holding among Canadian traders and is one of the most traded currencies in the world. The currency uses a blockchain network developed from the original Bitcoin blockchain. It was proposed by an expert called Vitalik Buterin in 2013 and remained one of the most popular cryptocurrencies in the world.
This currency was introduced in 2011 to facilitate cross-border payments. It has a much faster transaction verification than Bitcoin.
Crypto trading Canada works just like trading in any other country. The crypto trader engages in price speculation whereby they pick a currency of their choice and speculate whether the price will fall or rise in value. Most crypto assets are quoted in US dollars, but the trader does not take ownership of the asset itself.
Crypto assets are volatile, which makes crypto trading a risky endeavor. This means you can lose all your money in a few seconds or earn massive profits. The introduction of leverage is what magnifies the potential gains or losses.
Here are common terms you should know before starting crypto trading Canada.
One common term is spread. This means the difference between the quoted buying and selling price. Before opening a trade, you will be presented with two prices; if you go along, you trade at the buying price above the market price or go short below the selling price.
All currencies and assets traded online are traded in lots which are batches of crypto tokens. Due to volatility, crypto lots are often smaller than stock lots. Lot sizes are determined by the broker on whose platform you are trading.
Leverage is the edge brokers offer traders to trade with more amount without having to pay full value for the trade upfront. All the trader needs to do is provide a small deposit called a margin to trade. Higher leverage may lead to an increase in profit or losses.
If you want to enjoy crypto trading Canada, you need to open a trading account with a reputable online broker. Picking a good broker is quite easy; you only have to read reviews of other traders who use their platforms as well as forensic reviews published by platforms like ours.
Here is a short list of 8 of Canada’s top crypto trading platforms or exchanges.
Crypto trading Canada depends on your risk appetite and what you want to achieve. Are you looking for quick profits or long-term gains? These are questions you must answer first before you go into the buying and selling of digital assets.
If you are convinced that it is something you want to do, then take the time to learn the skill, after which you can start investing small amounts for a start. As you grow your income, you can then increase your investment.
No, crypto trading is not illegal in Canada. In fact, Canadian crypto platforms are licensed and regulated by the authorities.
The most popular cryptocurrencies traded in Canada include Bitcoin, Litecoin, Ethereum and Dodge coin though there are others.
We recommend you make the sacrifice to learn the art of trading so you can better analyze the market. If you understand the trends, you will be better positioned to make the right moves.
You can start with $100. Minimum amounts are set by brokers.