Author: Admin

By Jacob Pouncey | Saxo Bank Analyst | Crypto Current Contributor

This week the entire crypto market cap rose by 4.5%, bringing the market cap to just above USD 180 bn. Bitcoin and Ethereum rose by 5.5% and 7% respectively. CME reported record volumes last Thursday with a notational value of 112,700 BTC or USD 546 mn.

• China looks to curb Bitcoin mining
  This past Monday the National Development and Reform Commission released a list of sectors that it plans to restrict or eliminate. Bitcoin mining was on that list put out by China’s top economic planning agency. Some in the industry believe that China could outright ban mining. An ban on mining could influence energy producers as Bitcoin miners predominantly run on renewables, meaning that miners often buy excess capacity. Additionally, most of the global mining activity takes place in China, and China could tax a large slice of the industry which pulled in over USD 4 billion last year. 
  
  
• XBT Provider list new products
  Cryptocurrency exchange-traded note supplier, XBT Provider, recently launched several new ETNs on a Swedish stock exchange. The notes track the spot price of Ripple’s XRP and Litecoin in both SEK and EUR. These offerings now double the number of ETNs from the provider. These give investors that ability to invest in these assets through a regulated exchange. Currently, ETNs from XBT provider is the only way on SaxoTrader to gain pure exposure to digital assets. Since the peak in early 2018, investors have gained multiple avenues to get exposure to digital assets without leaving the comfort of traditional exchanges and brokers. 
  
  
• Facebook looking for outside funding 
  Nathaniel Popper, a New York Times tech writer, stated that Facebook is looking to raise USD 1 bn for their cryptocurrency ambitions. This comes at a time when Facebook is sitting on over USD 40 bn in cash and cash equivalents. Facebook aims to launch a stable coin that is backed by a basket of traditional currencies held in reserve. Popper states that the outside capital raise could be a device to give an air of decentralization to the initiative since outside investors will have a stake in the Facebook-led project. I doubt Facebook will have trouble raising funds considering that the Whatsapp rival Telegram has raised over USD 1.7 billion. A Barclays analyst believes that Facebook coin could add USD 3-19 bn to the company’s revenue stream. The launch of FB Coin and its subsequent trading on exchanges could do a lot in terms of exposing and onboarding millions of new users to the cryptocurrency sector. 

By Mary Ann Callahan

The crypto market is nothing like other financial markets, as its volatility is way higher. Ups and downs happen overnight, and we need to act quickly in order to reap the benefits and consider our trade successful. Therefore, it is necessary that you obtain specific strategies which would help you in your effort to amass material wealth by trading cryptocurrencies.

Let’s take a look at some of the proven strategies that helped many crypto aficionados earn their slice of the crypto pie.

HODL

Hodling is an Internet slang term for holding. It involves buying assets once and waiting for a long time for their price to go up and sell them when the price reaches the ceiling. The name itself popped up on Bitcoin Forum, as the user who wanted to express the enthusiasm about this trading strategy wrote: “I AM HODLING!” The misspelled word went viral instantly.

There are many cryptocurrency traders (if they can be considered traders at all) who apply this strategy. This was mainly triggered by the idea that Bitcoin and other altcoins could go up again in the future. Basically, some say that hodlers are similar to position traders who take it slow with buying and selling. However, position traders still trade, although on rare occasions; while hodlers only, well, hodl.

This strategy is essential if you are new to cryptocurrency trading and don’t want to learn more about trading cryptos.

Scalping

“Scalpers” are traders who basically trade whenever any kind of fluctuation happens on the market. In other words, the sudden asset value changes will immediately attract scalpers who will use this as an opportunity to buy or sell their coins. The main idea is to use volatility as your primary weapon when trading and always be there to watch the things unfold in front of your eyes.

A word of warning! This is a very fast-paced type of trading. It involves regularly following the market on online platforms in order to be there when something happens. Furthermore, this strategy requires a more profound understanding of how trading works, so make sure to do some light reading before you become a “scalper.”

Successful scalpers understand a broader scope. They know that it is not only about cryptocurrencies but about the hype and all the other things that affect crypto prices. 

Day Trading

Day Trading is essentially the same as Scalping, except for the fact that trading is conducted less often and in smaller amounts. Day traders use asset fluctuations in order to get the most out of their crypto trading effort, but they do it one small step at a time, unlike scalpers who always aim at the big picture. Every day trader should pay attention to things such as trading volume, market liquidity, and asset volatility as these play a crucial role in the day trading strategy.

What you need to understand is that both scalping and day trading involve a lot more risk than hodling. When you hodl, you take a long-term risk which is not as dangerous as emotion-filled one that scalping and day trading include. In other words, you need to be mentally prepared for an emotional rollercoaster throughout the day if you want to devote your time and money to this type of trading.

Buy When Low – Sell When High

“Buy when low – sell when high” is a type of strategy that is basically included in every other kind of strategy. It is only natural that you want to buy low-priced assets and sell them when they peak. However, if you are a newbie in cryptocurrency trading, you may just want to follow this formula as the number-one rule. Therefore, make sure to watch crypto prices every day and buy coins when you think they have reached their floor price. 

The same principle should be applied to the cryptos that you own. Sell them only when you see that their price is going up and is about to hit the ceiling after which they will start going down again.

Sure, it takes a lot of understanding of how to do that properly. We suggest that you closely follow experts’ advice on this and read news about cryptos on a daily basis.

Balanced Portfolio/Unbalanced Portfolio

Balanced portfolio strategy means choosing a couple of tokens and start trading them equally. For example, you can choose to trade with Bitcoin, Ethereum, and Litecoin. A balanced portfolio would mean that you buy an equal amount of coins for all three cryptocurrencies and devote the same amount of time. This is a perfect way to test various currencies and continue with the one that seems to bring you the highest profit.

Utilizing the balanced portfolio strategy is not an easy task, though. Things can get complicated and out of control if your tokens change overnight contrary to your prediction. Therefore, instead of risking it with one type of coin, you are risking it with several cryptos. On the other hand, the reward can be very high if you play it right!

The unbalanced portfolio includes focusing on trading one cryptocurrency, but not excluding others completely. You would create your portfolio based on how each of these cryptocurrencies performs. For example, if Bitcoin performs well, it would be your primary focus, but Litecoin and Ethereum would also take up a portion of your portfolio.

Those who want to adopt an unbalanced portfolio strategy need to conduct thorough research in order to gain a deep insight into which cryptos are performing well and how they should structure their portfolio.

Conclusion

Both beginners and experts should have some type of strategy when they trade cryptocurrency in order to maximize the potential outcome. The strategies presented above are the tip of the iceberg to get you interested in crypto trading approaches. Therefore, if you plan to begin with trading cryptocurrencies, make sure to read more about the best possible strategy for you.

By Jacob Pouncey | Saxo Bank Analyst | Crypto Current Contributor

Date Published: April 3, 2019

This week the entire crypto market cap rose by 21%, thereby bringing the market cap to just under USD 175 bn. Bitcoin and Ethereum rose by 22% and 19% respectively. Most of the rally happened on the 2nd of April in a two-hour window, with Bitcoin smashing through previous resistance levels. Some are calling for the end of the bear market while others are calling it a false breakout. Whatever it is, the fact remains that Bitcoin has posted its first two consecutive months of gains since late 2017.

• BTC whale makes waves

Many believe that the recent price increase in BTC was due to algorithmically controlled buy orders across several exchanges to the tune of USD 100 mn. These buy orders quickly cleared through the order books and squeezed margin traders who were short Bitcoin. Over USD 500 mn shorts were liquidated on Bitmex over the last 48hrs. Since the OTC markets have maintained volume over the previous several months, some speculate that large traders who have built up substantial positions over the past several months with little slippage are now looking to increase their holdings through buying on the spot exchange and creating slippage to the upside.

• Binance is rumoured to add margin trading 
  A look at the API of the largest cryptocurrency exchanges Binance, suggests that it will begin to allow margin trading on its platform. If Binance were to implement this, it would mean that a majority of the top 10 cryptocurrency exchanges offer leverage. The others who do not offer margin are all under US jurisdiction. The introduction of margin trading on the platform will undoubtedly benefit the revenue stream of Binance and their proprietary token BNB. Binance has promised to use 20% of their quarterly profits to buy back outstanding BNB tokens until half the supply is gone. This mechanism acts as a dividend to all remaining holders of BNB.

• GBP stable coin on the way
  The Andreessen Horowitz backed startup TrustToken recently launched a stable coin backed 1:1 with the British pound. TrueGBP trades under the ticker TGBP on several OTC trading desks, and the firm is working on getting the Ethereum based token to trade on several spot exchanges. This stable coin now gives GBP owners the ability to hedge their cryptocurrency exposure in GBP and vice versa. This stable coin could be an interesting bellwether for capital flight from the UK to the cryptocurrency market as funds are held in escrow in US accounts.