The Fight Is On: Forex vs. Cryptocurrency Trading


Forex trading has been around for a long time and skilled traders have been capable of making a living out of it. But now we have cryptocurrencies, which are the novelty nowadays.

So… which one should you choose: The time-tested forex or the new and exciting world of cryptocurrencies?

This article will analyze the pros and cons of each, so you can decide at the end. Just be aware that any route you choose requires proper education, experience and patience.

In Defense of Forex: Why Should You Choose It?

Despite the large number of shady-looking websites promising you to make you rich with Forex in no time, it remains as a solid option for generating a decent income.

The first advantage of Forex over cryptocurrencies trading is that it is far more stable, hence you can capitalize more on your skills regarding fundamental analysis, so you can time your investments properly. But there comes the huge drawback: profits are lesser in comparison to the world of cryptocurrencies. Much smaller.

Forex exchanges bigger and quicker profits for more security and stability, and this can be more attractive for certain traders, because you can rely more on serious fundamental and technical analysis.

They both are not very different, since in both you need to exchange one currency to another. In the case of Forex it can be USD/EUR and in the case of cryptocurrencies the pair can be BTC/ETH. The difference relies on the volatility and forces that drive the price.

To get an idea on the difference in terms of volatility. In forex the maximum percentage is situated at around 1%, whereas Bitcoin has a volatility of around 10%. A great difference.

If you are more conservative with your trades and prefer stability over higher profits, then Forex is the place for you. Moreover, you can use it to establish your foundation for technical analysis, something that can be useful in cryptocurrencies trading.

Cryptocurrencies: The Wild West Is Back

For many these days of Bitcoin, Ethereum and cryptocurrencies are very similar to the Wild West days when those who dare to embrace big risks can amass a big fortune. They are obtaining more and more attention with the pass of the time, and fortunately there are great websites like which are up to date with the latest and most important happenings.

As of 2017 the current market capitalization of Bitcoin surpassed the $70 billion mark, but its value has been decreased as a result of the temporary ban on ICOs (Initial Coin Offering) implemented by China as well as the possibility of shutting down local bitcoin exchanges in the country.

This type of trading presents higher risks due to the elevated volatility, something that can change the value of any coin drastically based on the most recent news. An example of this is the cryptocurrency known as NEO (previously Antshares), which on September 4 suffered a major drop from approximately $30 USD to below the $20 USD mark, as a result of China banning ICOs, something that had a massive effect in just some hours.

Another example of the is the asset known as Civic (CVC), which experienced a significant rise in value on September 9 from approximately $0.35 USD to over $0.62 USD after being included in the exchange Poloniex. An increase of 77% is enough to leave many satisfied.

There are several cryptocurrency investors who opt for simply holding their investment till it meets their target price despite the waiting time. This is an approach that allows you to deal with the votality, but if trading like in Forex is your thing, then you better prepare yourself for very wild moves, because this is the nature of these markets.

As you can see the cryptocurrencies market reacts very quickly to news, therefore it is not most the light-hearted.

Final Words:

We’ve presented the facts to you, and now it is up to you to select which route to go. Just keep in mind that constant education, prudence and leaving your emotions out of this will make of you a great trader in any field in the long run.

And remember: just invest the money you are willing to lose.

Tom Carter is a financial journalist. His work has appeared in a number of publications, online and off.

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