People who buy Bitcoin for the first time are often surprised at how difficult it can be to exchange that Bitcoin for other currencies. This is because few exchanges allow direct trading between fiat and Bitcoin. Instead, most exchanges require that you first trade your Bitcoin for altcoins, which is a second virtual currency with a different origin and purpose than Bitcoin.
Fortunately, several reliable exchanges allow you to directly trade your Bitcoin for other currencies. These exchanges are known as ‘cryptocurrency exchanges’, and they’re operated by independent companies instead of large banks or financial institutions. By trading your Bitcoin through one of these exchanges, you can avoid the lengthy and complicated process of exchanging your Bitcoin for fiat currency. Instead, you can get your hands on the other virtual currencies that you want more quickly and with less effort. Here are some of the top benefits of trading your Bitcoin on a trusted exchange.
1. You can trade your preferred virtual currency.
Trading your Bitcoin on trusted cryptocurrency exchange will allow you to get your hands on the currencies that you want most. This can be important if you’re looking to diversify your investments, or if you have specific goals for trading currency. For example, if someone wants to trade their bitcoins for other virtual currencies like ethers, Litecoin, or Monero, they would first deal with Bitcoin and then trade these altcoins through an exchange like Bitcoin Traders.
By dealing with Bitcoin before trading altcoins, it may prevent the need for traders to pay higher fees when moving from one currency to another. For example, Coinbase charges a 0.25% fee per transaction when converting cryptos into either fiat currencies or other cryptos. Meanwhile, Bitcoin-Central charges only a 0.05% fee when converting between bitcoins and Euros (or any other currency).
2. You can avoid volatility risks.
One of the biggest risks with your Bitcoin is that it could become worth much less in the future than it is today. If you’re lucky enough to have bought your Bitcoin when it was low in price, chances are you have a lot more bitcoins today than you did then. And if that describes your situation, you don’t want to deal with the volatility of the market as it’s getting harder and harder for Cryptocurrencies to maintain their value.
By trading your Bitcoin on a trusted exchange, you can avoid this risk by using an exchange that allows direct trading between fiat and cryptocurrency. This means that whenever you decide to convert your Bitcoin for other currencies like US dollars or euros, the exchange will automatically convert them for you, so there’s no risk of losing money because of volatility.
3. You can register with a discount brokerage account.
Many cryptocurrency exchanges are willing to give you a discount on trading fees if you use your bank account or credit card as your deposit method. This means that you’ll be able to save money when it comes to trading.
This is an attractive feature for most people because it means you can avoid paying sizable transaction fees and just pay the smaller exchange fee instead. So, by using one of these reputable cryptocurrency exchanges, you can save money on both your trading fees and transaction fees.
4. You can use leverage to make quick profits.
Trading your Bitcoin for other currencies can quickly make you a profit. If you’re trading Bitcoin for an altcoins, you’ll get more coins in return than if you were to trade for fiat currency. This allows you to save on fees and take advantage of leverage. For example, if an exchange charges a fee of 0.2% per transaction, then trading one Bitcoin for a single altcoin will incur a $0.20 fee while trading that same Bitcoin for fiat currency would incur a $10 fee. If the value of the altcoin increases by 10%, then your 10% gain is twice as much as it would be with the fiat currency transaction.
This means that if you trade through an exchange and use leverage, then even small amounts of
5. You can diversify your investment portfolio.
Whenever you trade your Bitcoin for other Cryptocurrencies, you can diversify your investment portfolio. This is because each coin has a different purpose and origin. For example, one of the best-known coins is Ethereum. According to CoinMarketCap, Ethereum is currently the second most valuable cryptocurrency behind Bitcoin. However, it was originally designed to do things that Bitcoin couldn’t perform well at (such as creating decentralized applications), so it has a different use and purpose than Bitcoin.
If you want to invest in something without worrying about the price fluctuating too much, exchanging your Bitcoin for another type of cryptocurrency can help you reduce risk in your investment portfolio.
Trading your Bitcoin through a reputable cryptocurrency exchange is a quick and easy way to get the currencies you want. There are many benefits of trading your Bitcoin on a trusted exchange, as it allows you to avoid the long process of exchanging your Bitcoin for fiat currency and simplifies the process significantly.