How to trade Bitcoin with Binary Options?
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Purchasing or trading Bitcoin is becoming one of the most attractive and highly lucrative investment strategies. Bitcoin’s value changes a lot virtually every minute when matched to other currencies (typically the US dollar), making it particularly intriguing in terms of binary options. Buying actual money or using CFDs over a lengthy period of time should also be evaluated as viable possibilities.
Digital currencies are becoming accepted as deposit methods by some brokers. Traders can load their accounts and accept payments in Bitcoin, Ethereum, and other altcoins in this manner.
What are Bitcoin Binary Options?
Bitcoin binary options are a type of trading in which the price of Bitcoin is predicted to climb or fall over time. If you’re correct, you’ll get compensated for your choice. You will lose your investment if you are incorrect. Each Bitcoin option has an expiry date that may be used to determine whether it is “in-the-money” (you were correct) or “out-of-the-money” (you were wrong). You can receive a particular reward for each Bitcoin binary option. Since the outcome must be a profit or a loss, they are referred to as “binary options.”
Examples of Binary Options Trading on Bitcoin
For example, let’s say it’s 10:00 AM and the price of BTC is $575,505. On March 17th, at 5:10 PM, we expect the price to be higher than $575,505, so we buy the Call. If the BTC price is above $575,505 at 4 PM, you will be paid 73% of your investment, if it is lower, you will lose money.
Another example: If you think the price of BTC will fall. Then you buy the give option. If the price is lower than the original price at the end of the period, you will receive an additional payment.
Where to trade Bitcoin with Binary Options?
Not all Binary Options Brokers offer to trade Bitcoin or accept Bitcoin as a deposit and withdrawal method. In the following table, you can see the best brokers where you can trade Bitcoin:
Broker: | Review: | Advantages: | Account: |
|---|---|---|---|
1. Quotex  | + Accepts international clients + Crypto payments + Bonuses + High payout 95%+ + Best platform | Live-account from $ 10 (Trading includes risk) | |
2. IQ Option  | + Easy platform + Best support + Highest yield + Multiple payment options | Live-account from $ 10 (Trading includes risk) | |
3. Pocket Option  | + Accepts any clients + Bonus program + Social Trading + Accepts international clients | Live-account from $ 50(Trading includes risk) |
(5 / 5)
(4.9 / 5)
(4.7 / 5)Benefits of Bitcoin Binary Options
It is not necessary to know the exact value of Bitcoin at the end of the option, only if it has increased or decreased. You don’t need extensive trading knowledge to participate in Bitcoin’s binary options. The payout can be 88% ROI.
Disadvantages of Bitcoin Binary Options
As you may have noticed, binary options on Bitcoin are like a simple game. If you study binary options in detail, you will find that trading platforms always have an advantage over investors (you need to earn more than 50% of your time to keep your budget balanced). Due to the unpredictability of Bitcoin binary options, in many countries, there are strict rules about who can do such business, so it’s a good idea to check if the exchange you want to trade on Bitcoin binary options is regulated.
Also, Bitcoin options can be very addictive (like a game), and no matter how knowledgeable you are, it is impossible to consistently predict what will happen to the bitcoin price in a short period of time.
What are the Bitcoin options?
Options are financial derivatives based on underlying assets such as stocks, currency pairs, and oil. Bitcoin option is a non-standard option used to capitalize on the price movements of these assets over time.
Bitcoin options provide either a fixed income (the difference between the transaction income and the asset price) or a loss (asset value) at a time determined by the parties under terms agreed by the parties to the transaction.
Bitcoin options are bought in advance at a fixed price, so you know the size of the potential loss and the size of the gain even before the trade is made.
Another factor in these offers is the time limit. Each option has its own duration (expiration time or expiration time).
No matter how significantly the price of the underlying asset has changed (how high or low), there is always a fixed payout if the option wins. Therefore, your risk is limited only by the amount you purchased the bitcoin option.
How to trade Bitcoin Binary Options on Quotex?
To trade binary options, simply put funds into your account and log into the platform. By default, binary options trading is displayed.
- Select the asset you want to trade. Currencies, Commodities, Cryptocurrencies, Indices
- Select an expiration date.
- Select the transaction amount. The minimum transaction amount is $1.
- Select the Up (green) or Down (red) option depending on the forecast. If you expect the price to go up, click Up, if you think the price will go down, click Down.
- Your trade results will be displayed immediately after closing your position on your balance. You can check the progress of your order in the “Benefits” section.
(Risk warning: Trading involves risks)
What is the contract expiry date?
The validity period is the time the transaction is considered closed (closed) and the results are automatically summarized.
When you complete a trade with digital options, you set the execution time of the trade independently (1 minute, 2 hours, 1 month, etc.).
What is a trading platform and why do you need it?
A trading platform is a software package that enables customers to conduct business (operation) using various financial products. You can also access a variety of information such as quote values, real-time market rankings, company measurements, and more.
What are the possible outcomes of trading in one place?
There are three possible outcomes for the digital alternative market.
- If the prediction of the movement direction of the underlying asset price is correct, you will receive a profit.
- At the end of the option expiry, if the forecast is not accurate, you will face a loss limited by the value of your asset (i.e. you may only lose your investment in practice).
- The level risk is always limited by the size of the asset, as it returns the investment if the trade result is zero (the underlying asset remains the same and the option expires at the purchased price).
What determines the profit margin?
There are several factors that affect your earnings.
- Liquidity of the selected asset in the market (the higher the demand, the higher the profit)
- Trading hours (the liquidity of the morning asset and the liquidity of the afternoon asset can vary significantly)
- Real Estate Agency
- Market changes (economic events, changes in financial assets, etc.)
How can I calculate the profit of a crypto binary option trade?
You don’t have to calculate the revenue yourself. Crypto binary options have a fixed amount of profit per trade, which is calculated as a percentage of the option value and does not depend on the magnitude of this change in value. For only one trade, if the price changes in the intended direction, you get 90% of the value of the option. If you alter 100 positions in the same direction with the same price, you get the same amount.
To determine the amount of profit, you must:
- Choose an asset on which to base the alternative.
- Enter the price at which to purchase the option.
- Set the trading hours. After these actions, if the forecast is correct, the platform will automatically display the correct rate of return.
The profit margin on the transaction can be 98% of the investment amount.
The profitability of crypto options is determined immediately upon purchase, so you don’t have to wait for an unwanted surprise in the form of a low percentage at the end of the trade.
As soon as the transaction closes, the balance is automatically filled with this profit.
What kinds of bitcoin options are there?
When trading bitcoin options, you need to choose the underlying asset to back the bitcoin option. Your outlook for this asset has been met.
Simply put, when you buy a bitcoin contract, you are actually investing in that underlying asset price movement.
An underlying asset is a “commodity” whose price is taken into account when trading. Products that are in high demand in the market generally serve as key assets for crypto options. There are four types.
- Securities (shares of global companies)
- Currency pairs (EUR/USD, GBP/USD, etc.)
- Raw materials and precious metals (petroleum, gold, etc.)
- Indices (SP 500, Dow, Dollar Index, etc.)
There is no universal underlying asset. If you choose to work with it, all you need is your knowledge, intuition, and different types of analysis data accessible together with market analysis for specific financial instruments.
(Risk warning: Trading involves risks)
What is the key to bitcoin options trading?
The truth is that bitcoin options are the simplest form of financial derivatives. To make money in the digital options market, you don’t need to predict the market value of an asset you can reach.
The principles of the trading process are reduced to one problem: the price of an asset goes up or down when the contract is executed.
The essence of these bitcoin options is that they don’t care at all that the price of the underlying asset will fall 100 points or 1 point from the time the trade closes until it closes. It is important to determine the only movement on this price.
If your prediction is correct, you will still receive a fixed income.
How can I quickly learn how to make money in the bitcoin option market?
To make money in the bitcoin options market, all you need to do is predict accurately the price direction (up or down) of your chosen asset. So, for a stable income, you need to:
- Develop your own trading strategy to maximize and pursue the number of accurately predicted trades.
- Risk diversification
Monitoring the market and studying the analytical and statistical information available from various sources (Internet resources, expert opinions, analysts in this field, etc.) will help you develop strategies and find diversification options.
Bitcoin Fundamentals
Bitcoin is a global trend, and binary options are gaining popularity. Because of their high volatility, digital currencies are perfect for binary trading with expiry dates. Because of the currency’s reputation and current status, it’s a prime target for fraudsters and other bad actors, so only deal with trusted brokers like those listed on binary options.net.
To begin trading binary options on Bitcoin, you must have a basic understanding of the currency. Bitcoin is an electronically produced currency that may be used anywhere that accepts Bitcoin. This is in support of a free and universal trading system that is not reliant on central banks and does not impose an extra cost. Coins are built on complex cryptosystems that generates value through a process known as “mining.”
Miners, who are often software computer operators, produce currencies by executing algorithms that tightly limit the quantity and speed of coin mining in order to prevent them from being withdrawn. Coins can be sold, swapped, or exchanged once they have been mined. Bitcoin is now utilized for the worldwide currency exchange and international trade, although it has not yet been adopted by the world’s major nations.
There were just a few brokers selling Bitcoin as a trading asset a few years ago. There is now a third option. Several brokers now provide Bitcoin trading as well as trading in less popular crypto coins like Ethereum and Litecoin. As a result, traders currently have a lot of options when it comes to finding a bitcoin broker. If your existing broker does not provide this service, you might probably switch.
Bitcoin wallet
In order to buy and sell Bitcoin (instead of merely predicting the price), you’ll need a bitcoin “wallet.” Here, security and transparency are of the utmost importance. This wallet is entirely secure because it contains virtual currency. Quotex is a good and reliable service that we suggest.
How Does Bitcoin Trading Work? Some forward-thinking brokers have spotted new opportunities in Bitcoin and Binary Options, and have proposed trading Binary and Bitcoin Options simultaneously. In general, there are two methods for trading Bitcoin binary options. The first way is to use Bitcoin as a currency. The second approach is to use Bitcoin as an underlying asset.
Bitcoin as a medium of exchange
Traders trade different financial assets in the financial markets when utilizing Bitcoin as an exchange. You can, for example, trade the EUR/USD underlying asset and ask for a rise or fall once the binary option expires. As a result, if the transaction is completed successfully, you will be compensated in Bitcoin rather than fiat currencies like US Dollars or Euros.
You could be questioning how anyone would wish to receive Bitcoin if they only pay in USD, as is customary. The first benefit of Bitcoin trading is that it offers the cheapest transaction charges of any online payment method. This is why Bitcoin was founded in the first place: to make online transactions more affordable. Because Bitcoin is not controlled by a central body, there are no service fees while receiving or making payments.
The added return of Bitcoin is just another major reason why traders utilize it to trade binary options. Bitcoin is a stand-alone currency whose value versus the US dollar is determined by demand. Traders can insulate themselves from Bitcoin price volatility while also earning extra from their deals by presenting all trading activity in this cryptocurrency.
It should be emphasized, however, that this sort of trading is only available through binary brokers who accept Bitcoin as a payment method.This means that only a limited number of binary options brokers fall into this category.
Bitcoin as a major asset
Treating bitcoin like a big asset is another strategy to trade bitcoin with binary options. Bitcoin’s value has nearly reached the price of gold due to a strong increase in demand. Because of this instability, some binary brokers have begun to provide binary options contracts based on Bitcoin prices. To put it another way, Bitcoin trades like any other investment product on many of these binary brokerage platforms.
Deposits and payments in digital currency
Traders can deposit, trade, and receive Bitcoin payments with it. Quotex is the most popular broker that provides this service. Accept 15 different cryptos, including Bitcoin, Ethereum, and Litecoin.
(Risk warning: Trading involves risks)
See our other article about Binary Options:
Last Updated on January 27, 2023 by Arkady Müller
