CRYPTOCURRENCY TRADING Vs FOREX TRADING Vs STOCK TRADING - Part 1
Cryptocurrency trading is an act of forecasting or predicting a Cryptocurrency price change through a CFD platform; which are detailed instrument, or buying and selling a implicting coin through an exchange. Money can be lost easily in a Cryptocurrency trading due to exploitations.
The CFDs trading are offshoot which gives the knowledge to predict changes in price of Cryptocurrency, hence, you can buy if your predictions shows that a Cryptocurrency will increase in value and also sell if it predicts a decrease in value.
Cryptocurrency are decentralized and not controlled by a central government, they operate on computer network and are stored in wallets- stored on blockchain because they are digitalized currency unlike the local or physical currency.
In transacting a cryptocurrency, transfer are made to dital wallet of the receiver by the sender. When this takes place, verification is done and there I addition to the blockchain through a mining process- new coin are also created through the same procedure.
Looking at the word Blockchain,they are database which stores information in blocks that are chained together. It should be noted that database are collection of information that store information and data in an electrified way in a computer system.
Blockchain can be said to be in a table format where new or latest information are entered into a new colum and row. However, it should be noted that blockchain collect information in groups, each block has a specific storage in which whenever they are filled up, they are chained together with the ones previously filled.The blockchain follows such procedure.
Blockchain are safe for transactions because after the addition of block to the end of a blockchain, the alteration of the content is usually a difficult task unless there is a general agreement to do so (this act is not common) . In addition, blockchain can be used in elections for voting i.e modernized voting, through this, electoral manipulation is removed.
Even though blockchain is good because it serves as a platform for secured transactions, and also high level of transperancy, it also has some disadvantages such as high technologicsl cost and illegal activity.
Examples of Cryptocurrency includes Bitcoin, dOgecoin, etherum etc.
FOREX TRADING
FOREX trading which is also known to be FX, Foreign Exchange Market or Currency Market is describe as a globally over the counter or decentralized market where currency trading are carried out. It's the largest market in the world. No physical contact or exchange is required in FOREX trading.
The exchange rate for every currency is determined by FOREX. The operations of FOREX are carried out through financial institutions (retail investors, commercial banks, and also investment banks) unlike the Cryptocurrency which does not have a central authority.
FOREX TRADING also enable international trade i.e goods produced in a country can be exported to another country. Forex trading can be seen as exchange of currency done by travelers when they want to travel abroad.
The Supply and demand of buyer and sellers plays a mojar role in the determination of prices of currency. Forex trading is unique because it has a continuous operation, it uses leverage to to boost profit.
In the world, there are more than 170 currencies in which codes are assigned to them in three letters like NGN, USD, JPY, GBP, CHF, AUD, NZD and so on. Apart from USD which is mostly used in FOREX trading, we have some other ones which are used also e.g EUR (European Union) which is the second after USD, NZD (New Zealand Dollar),CAD (the Canadian Dollar), AUD (Australian Dollar), SHF (Swiss Franc), GBP (British Pound) and JPY (Japanese Yen).
Forex trading can be done in three ways which includes:
The Future Market
The Forward Market and;
The Spot Market. Here, currency are swap for each other.
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