Cryptocurrency burst onto our investment scene back in 2009 when Bitcoin was established. Since then it has gained in both popularity and notoriety as an asset class. Along with a proliferation in the types of cryptocurrencies themselves, there has also been a huge explosion of cryptocurrency trading platforms and apps to meet the increasing demand. Here, we look at our top 5 to help you make the best cryptocurrency trades.
What Makes The Best Cryptocurrency Trading Platforms?
Knowing what makes the best crypto trading platforms is tough. Essentially as we all work in different ways, want different things from trading platforms and are investing for different reasons. However, while that can mean that some apps are better suited to particular people more than others, there are a couple of characteristics that you should keep an eye out for as standard.
Transparency
For trading platforms to be usable for the long term, they cannot partake in any dubious practices. As a result, ensure that the platform you use is regulated by an authority you trust and the platform is clear on how they charge fees.
Intuitive
There is no point signing up to an app or platform that you cannot use easily. Different software will be easier for some people than others – and vice versa. Ensure that the trading platform you subscribe to is one that allows you to place trades simply and quickly. Plus, make sure you know how to use the entire suite of tools within a platform’s package. There will be many features that can help you make the most of your investments.
How to Invest in Cryptocurrency – UK Investors
While the technicalities around the world can prevent, hinder or promote certain cryptocurrency trading, here are three ways the UK citizens can take positions in this asset class.
Funds
Firstly, buying and selling cryptocurrency ETFs or simply wider funds can be a good way to invest in crypto. The advantage of investing in cryptocurrency in this way is that you benefit from another person making and placing trades. You simply purchase the fund that you think is likely to make you the most return for the least amount of risk. Plus funds are good at diversifying that risk as the multiple investments mean that you are not exposed to just one cryptocurrency. And, if you invest in a fund that has cryptocurrency as just one of its asset classes, you will be even less exposed to the risk of volatility in an asset class. However, with that diversification can also come a lower return.
Directly
One way that many cryptocurrency traders want to get involved with crypto is to buy into it directly. While you can never actually hold the digital currency itself, you can hold it in an e-wallet and sell it whenever you are ready. Investing in this way will often require the best UK cryptocurrency brokers or platforms you can use, which we recommend below. Investing directly means that you benefit even more from rises in value when compared to funds that invest in crypto as well as other assets. However, your losses can be that much worse too.
Take payment
Finally, another way to trade cryptocurrency is to take it as a form of payment for something – much like you would other, traditional currency. For example, more and more online shops are taking Bitcoin as a form of payment for their goods. If you have someone to sell, this could be an option for you.
Best Platform to Trade Cryptocurrency – UK Investors
Here are our top tips for the best platforms to trade cryptocurrency.
eToro
eToro is one of our favourite platforms to trade cryptocurrency. That’s down to its zero rate commission structure which can really take the sting out of the cost of trading. Plus, you can trade at any time of day on eToro as it is open 24 hours a day. Finally, its $200 minimum deposit may not be the lowest around, but it’s not an eye watering amount either.
Stormgain
While Stormgain is currently unregulated, it offers very low trading fees which is always a massive bonus. Additionally, it has very well designed mobile and desktop apps so that users can find a format that suits them best. It is currently registered to Saint Vincent and the Grenadines which may make them a very attractive prospect for some.
DEGIRO
Dutch-based, DEGIRO is regulated by AFM and DNB. Its software is highly effective and users often find its platform quick and easy to use. One of its biggest draws, however, is that it does not have a minimum deposit or any withdrawal fees.
Plus500
Plus500 may not be for everyone, but those that get along with its software will benefit from the fact that Plus500 has exceptionally low spreads as well as no commissions. The two do not often go hand in hand with one another and it’s rare to see. Plus500 users also enjoy some exceptionally fast execution speeds. As a result, making trades that are perfectly timed for the best entry and exit points for you is far more likely.
AvaTrade
AvaTrade is regulated in 6 countries, including Ireland and Japan, so if you are looking for a platform that has an authority’s backing, this could be the platform for you. Additionally, it has excellent research features and a low $100 minimum deposit. While inactivity fees are charged, those who plan on trading frequently may find AvaTrade’s platform the one for them.
Best Cryptocurrency Brokers: UK Based Takeaways
All the above cryptocurrency brokers can help a UK resident trade the asset class with ease. However, be sure that when you do trade in crypto currencies that you are taking into account your risk profile and ability to tolerate risks or losses. All investments can lose value as well as make gains, but cryptocurrency are one of the most volatile markets around.