Bitcoin and Binary Options Trading

Binary options have been becoming more and more popular in the last 2 years. This type of trading has been desired among new traders as they don’t need to actually buy anything, just predict whether the asset will move up or down in specified time frame. Those trades are happening in short time frames (30 sec, 1 min, 5 min) but might be months too. If the trader predicted wrongly, they will obviously lose their money. If the trader was right in his/her prediction, they will receive 80-85% payout, depending on the broker.

Binary options are sometimes referred to as ‘all-or-nothing options’, ‘digital options’, or ‘fixed return options’ (FROs), which are traded on the American Stock Exchange.

Bitcoin (BTC) is a digital currency which is created and held electronically and no one controls it. “Bitcoin is an online payment system invented by Satoshi Nakamoto, who published his invention in 2008, and released it as open-source software in 2009. The system is peer-to-peer; users can transact directly without needing an intermediary.Transactions are verified by network nodes and recorded in a public distributed ledger called the blockchain. The ledger uses its own unit of account, also called bitcoin. The system works without a central repository or single administrator, which has led the US Treasury to categorize it as a decentralized virtual currency. Bitcoin is often called the first cryptocurrency… “

Bitcoin as a currency in binary options trading

Bitcoin is now widely used currency and many trading platforms accept it as a method of payment for their clients’ trading deposits. There are many benefits using Bitcoin as a currency. The first benefit is “the fact that the cost of transaction is the lowest among all forms of online payment. This is the very reason why Bitcoin was created in the first place, to lower the cost of online transaction. Since there is no central authority managing Bitcoin, no service fee is paid when receiving or transmitting payment.” Another reason for traders to use Bitcoin as a currency is that Bitcoin itself is tradeable and they can earn extra Bitcoins that way.

“By having all the trading transactions denoted in Bitcoin, a trader is able to shield himself from the fluctuation of this crypto currency while at the same time earn more of it through profits earned in trading.”

Bitcoin as a commodity in binary options trading

With a recent popularity of Bitcoin and its acceptance as a currency, many binary options platforms started using Bitcoin as one of the currencies to trade. so as an asset. Stockbrokers are seeing the value in trading BTC against flat currencies, mainly versus American Dollar.

Today there are 2 main types of Bitcoin binary options platforms:

  • First-generation brokers – binary options platforms that allow trading on Bitcoin
  • Second-generation brokers – platforms that offer both Bitcoin funding and Bitcoin trading

First generation brokers – brokers who offer Bitcoin trading:

  • Coinut – only Bitcoin options exchange platform; programmed as a robust and distributed on Linux operating system coinut.com
  • BTClevels – Bitcoin binary options trading platform; with or without registration, hassle free btclevels.com
  • 24 Options – one of the first brokers who started offering BTC as an asset 24option.com

Second-generation brokers – brokers who offer Bitcoin funding and trading:

  • Traderush binary platform – accepts BTC deposits traderush.com
  • Nadex trading platform -accepts BTC funding and allows BTC trading; offers limited risk, short-term trading, transparency and full regulated market nadex.com
  • Satoshi Option trading platform – accepts BTC funding and allows BTC trading; doesn’t require account registration neither personal details. Payouts are near instantaneous and the service is accessible from anywhere in the world satoshioption.com
  • BTCOracle platform – Bitcoin only platform – allows BTC funding and trading offering few wallet options and full transparency btcoracle.com
  • Bitstamp platform – As above, BTC only platform – allows BTC trading and funding but requires login bitstamp.net
  • Bitcoin Wisdom – allows trading 3 digital currencies, Bitcoins, Litecoins, Altcoins versus other flat currencies and requires login bitcoinwisdom.com
  • Beast Option – allows BTC funding and trading of Bitcoins and Litecoins; guarantees fairness in pricing regardless of market fluctuations beastoptions.com

When choosing a Bitcoin broker it is important to check their terms and conditions, paying a particular attention to the information whether their Bitcoin Assets are stored in “Deep Cold Storage”. It means that Bitcoins are insured and stored offline, where they are not susceptible to hackers.

Benefits of Binary Option Trading

Binary options are one of the newest and exciting methods of investment which is risky but with high returns. The binary options traded take about one hour to expire but with a high return. To some, it might be too risky but the courageous investors will always make the bold step as they know at the end they get a good return. The process involves investors buying contracts on various underlying assets then predict whether the invested option increases or decreases in value. An increase means a good return for your trading. Here are some specific benefits of Binary Option Trading.

Short term investment

The ordinary options available in the market take many years before they mature. However the binary options invested in might take one week, one day or even some few hours before they mature. If you choose your Option Trading well, you can get as high as 170% in return in only one contract within an hour. Choosing the best strategy in the market with the ideal trend reused over a long time as long as it give positive results. This positive trend ensures that the investor gets almost double of the invested sum.

High profits

When Binary Option Trading is done, the investors get high returns within a short time. As compared to other stock trading that takes time to mature, the options traded will always have a positive return almost double of the invested sum.

Calculated rewards and risks

When you start Binary Option Trading, the investor gets a boost in that there is a fixed investment option. Even before you invest, the difference in profit and loss is known in advance. With the calculated risk and rewards, investors are sure not to lose more than expected in the market. There is always the cap on the amount of money to earn or lose in a single investment. The trading time is usually short while returns are higher. This means that there is a fixed rate that can turn to a bigger advantage for the investors.

Good client support

Different players in the market pride in providing investors with good client support systems. Most of the binary systems have set a good customer service department that help in providing essential information. This means an added benefit as they are easily reached. However each trading platform has their own levels of client satisfaction and investors must check them out.

Ideal in volatile markets

Sometimes the investor fear putting money in volatile market situations. With Binary Option Trading, investors get the safe way to make sure they are continuing to invest. Some traditional stock markets are sometimes rocked by market volatility hence huge losses. The binary trading has a fixed rate to trade such that any swing in the market is controlled while retaining the fundamental principles. The inclusion of short contracts, transparent risks and high returns means even in cases of a volatile market, high returns are guaranteed.

By making investment in binary options, only one pip is used to determine whether you get the profit or loss. The ordinary stock markets need more than three pips to decide on the level of profits or losses.

Binary Option Trades – Avoid Over Trading

When working in the trade industry, eventually, every one will want to know when it’s the appropriate time to place a binary option trade. Knowing when to place a digital option trade all depends on the type of trader that you are.

There are two types of people that will use the binary trade. The first is the trader that uses it at will, without much forethought. The second is the trader that will only use the digital option when the market will give them an advantage tower their trading strategy.

Waiting for the right trading conditions is the best strategy for new traders to the binary option trade. By having patience, the new digital option trader will avoid disasters to their funds and long-term strategy.

There are two options when picking the right trade. The first is by choosing or creating a system yourself that will lead you down the right path. The second is using a system that you bought online or one that you trust in.

Choosing one of these two systems is essential to future success. Not using a system to succeed is the worst decision that can be made when dealing with binary option trades is not having any system at all. By using a system, you can easily test it to determine if the system is going to be useful or a total waste.

The best part of binary options trading is the excitement that’s involved with the process. The process is filled with emotional roller coasters that makes trading really get the heart pumping. Because of the excitement involved, it can easily be over done, leading to the classic case of the over trader.

Don’t Over Trade

Becoming fond of digital options trades can be very easy, and that can make it very addictive. It’s a trap that many new traders fall into when they first start to trading binary options. The goal is to make a trade decision using discipline and knowledge, though these can quickly go out the window due to emotions and personal ego’s demanding success.

Some traders hit the target quite well when using their gut, at first. It’s inevitable that the traders gut will falter and perhaps cost more than they had made along their binary trading path. All binary traders go back to a predetermined plan or strategy that will work for them before or has worked well for another.

The result of gut instincts usually involves the trader taking a small loss and risking big to make that loss a profit. This strategy is a folly at best. The end goal of binary option trading is much like poker, playing your hand to minimize losses until that special circumstances make you a big winner. The best advice when taking a loss is to, simply, take the loss and move on to your next digital options investment.

Binary Options Trading: What It’s All About

Binary options trading is an exciting way of investing on the stock market. Here, an investor does not need to buy an asset but guess the direction it could take. Binary options are an easy and effective way to invest money in stocks and make a little extra on the side, sometimes in less than 60 minutes!

Binary means ‘two’, and in this type of trading there can be only two results: either the asset invested in will rise or drop in value. For example, a trader invests 100 dollars in a certain asset and speculates that its stock will rise by the end of the week. If the stock does rise in that time frame, the investor makes a profit but if the stock falls, the investor runs at a loss.

How it’s done

To make a binary option trade, the investor must first choose an asset, and this could be a commodity, index, stock or foreign exchange. After this, they have to pick a time frame, or expiry time, for their prediction; this could be anything from a month to a week, day or even an hour. The trader then needs to choose which direction they feel the asset’s value will move, depending on which they will make a profit or a loss. If the investor places a call (up) option and the price goes up they make a profit, and if they place a put (down) option and the price does drop, once again a profit is made.

Advantages

Though there are always risks when dabbling in the financial markets, there is a controlled risk in binary options trading. Here the profits and losses of trading are known to the investor upfront, allowing them to strategize where to put their money thus lowering risk. Binary trade options give investors a greater chance to make a profit. This is because profits depend more on whether the value of the asset goes up or down, rather than its price. Besides being easy to learn how to trade, binary options trading is where the finance meets technology, and anyone with an internet connection can trade from the comfort of their home, privacy of their office or even an Internet café.

Uniqueness

Binary options trading is unique in that while regular, or vanilla, options have a quarterly or monthly time frames, binary options have short times frames that range between an hour and a month. This means that a trader can make a profit within 60 minutes. Another way it differs is that with regular options the investor’s profit (or loss) is contingent on the difference between the price of the option and the stock at the expiration of the time frame, while in binary options both prices are set before the trader invest minimizing the risk of a loss.

At the end of the day, binary options trading are a simple way to make a profit from the financial markets. There is always a risk, but it is low enough not to put a hole in the investor’s pocket. Nor does the investor need to have expansive knowledge or experience of trading, which can be learnt “on the job”, so to speak.