Knowing the fundamentals of CFD Cryptocurrency trading will help you better understand the risks and the cost associated with trading CFDs on cryptocurrency. CGI features an extensive learning center that can help familiarize you with how to trade cryptocurrencies or any of the other instruments we offer. Here are a few of the fundamental terms that apply across CFD trading:

• Base and Quote Currency – trading Bitcoin, Ethereum, Ripple, and Litecoin all instruments are displayed with three-letter abbreviations with a backslash and another three-letter currency next to it i.e. BTC/USD. The BTC is the base currency and is always 1 unit of the currency (i.e. 1 Bitcoin) whereas the USD is a quote currency and is the amount needed to buy (or sell) 1 unit of the base currency.
• Buy – when trading most instruments are in pairs, when you ‘buy’ you are buying one side of the currency pair while selling the other. In the case of BTC/USD, it is as if you are buying bitcoin and simultaneously selling the US Dollar. Traders generally buy when the currency pair’s rate is low. Although the term is ‘buy’ you are not actually obligated to own the asset or currency pair, which allows you to take advantage of both upwards and downwards trends.
• Sell – Like ‘Buy’ when you sell a CFD Cryptocurrency cryptocurrency pair you are ‘selling the base currency and ‘buying’ the quote currency. Again, the terms ‘buy’ and ‘sell’ are illustrative, you are actually exchanging.
• Bid and Ask Price – In very simple terms, CFD transactions are bilateral, i.e. involving two parties. The seller ‘asks’ for a specific price for a cryptocurrency instrument and the ‘bid’ is the price the buyer is willing to ‘bid’ or purchase the instrument (or underlying instrument in the case of cryptocurrency CFDs).
• Spread –spread is the difference between the lowest bid and highest ask price of an instrument. Spread is also what you pay when trading CFD cryptocurrency instrument – because as mentioned above when trading cryptocurrency pair or any other currency pair you are buying and selling at the same time. When you trade with a fixed spread broker like easyMarkets this cost never changes during trading hours, giving you a tactical advantage because your costs are apparent upfront and transparent. With floating or variable spread brokers' spreads can change in response to volatility, increasing trading cost significantly. What is worse is that this can result in an otherwise profitable trading session ending up in the “red” or unprofitable.
• Lot – a lot is 100,000 units of the base currency. Of course, a smaller denomination of lots is available as well 100, 1,000, 10,000 to accommodate any size of account and margin availability.

No, you only need to register for a CGI account and to submit your KYC (Know Your Client, i.e. identity verification) information. Unlike a cryptocurrency wallet, there’s no risk of losing or becoming locked out of your account. You also do not need to sign up with a cryptocurrency exchange to trade cryptocurrency with easyMarkets.

CGI has access to trade Bitcoin, Ethereum, and Ripple against the US dollar. Of course, we buy and sell across up to 10 cryptocurrencies and we are constantly expanding the instruments we offer, so if you have a favorite let us know!