What is the best way to trade bitcoin

Bitcoin trading: provider for secure bitcoin trading

Bitcoin trading comes in two forms: trading certificates and actually buying and selling cryptocurrencies.

There are more than 8,000 cryptocurrencies worldwide. These have a total market capitalization of more than 900 billion US dollars (around 729 billion euros, as of early January 2021). Bitcoin makes up the lion's share with more than two thirds of this. It is recommended for entry into the world of cryptocurrencies. What you need to trade bitcoins is a clear, secure trading platform. In the following you can read which internet providers you can use to buy and sell Bitcoins - and which alternatives there are to direct Bitcoin trading.

The contents of this article:

»What distinguishes a suitable trading platform?
»Which trading platforms are there?
»Alternative to trading Bitcoins directly: Bitcoin CFDs
»Buy Bitcoin: More Tips to Get Started

What distinguishes a suitable trading platform?

How do you, as a user, know whether a platform is serious and suitable for beginners? The following points are decisive when deciding on a provider:

  • Free demo account: Good trading platforms enable you to test the platform and functions in advance without risk with "play money". This may be irrelevant for experienced traders, but this option makes sense for beginners.
  • Security: Bitcoins are a lure for cybercriminals. Security, for example against hacker attacks, is therefore a particular focus of trading platforms. SSL encryption and two-factor authentication (2FA) are the minimum.
  • Fees: Check exactly when and which fees are incurred for trading on a platform. Typically, these are collected as a percentage. There are also some differences in the payment method, i.e. whether you buy Bitcoins via PayPal or credit card.
  • Minimum budget: Even small investors with a low budget can trade in cryptocurrencies. However, some exchanges have set a minimum amount as an entry barrier.
  • Payment methods: Make sure that at least the classic payment methods with the usual credit cards, PayPal and possibly also instant transfer and Giropay are available.
  • Available cryptocurrencies: Bitcoins can be traded on every crypto platform, but not all offer all of the over 8,000 other coins. Even if this may not be so interesting at the start of trading, you should think from the start which cryptocurrencies could be of interest to you in the future and whether these will also be traded on the platform of your choice.
  • Regulation: Basically, the idea of ​​crypto currencies was or is that they get by without the (regulating) control and distribution by and by banks. That is why Bitcoin exchanges are usually not regulated. However, this is also a factor of uncertainty in the event of irregularities. eToro is the only trading platform that is monitored by several financial regulators within the EU, which is why it is particularly recommended for beginners. With all other platforms, you should create an external wallet to secure the Bitcoins there after buying.

The usability of the platform is less a quality feature and more a question of convenience: The best platforms for Bitcoin trading can not only be used on the desktop, but also conveniently via app.

What trading platforms are there?

Well-known Bitcoin exchanges that have been rated (very) well in many tests are:

  • eToro
  • Binance
  • Bitpanda
  • Coinbase
  • Bitcoin.de

Especially eToro is described as recommendable in many tests and is therefore (also) a good choice for beginners. Another advantage: With eToro you can also trade Bitcoin CFDs.

What bitcoin trading apps are there?

Users who want to be informed about the latest developments in cryptocurrencies anytime and anywhere should take a closer look at Bitcoin trading apps. Many investors have long been using apps for their smartphones to trade securities. Because almost everyone has it (almost) always with them and so traders can react quickly to market developments.

Bitcoin trading platforms also rely on smartphone apps as a supplement to the web platform. For example, the trading platform eToro also offers its users a Bitcoin trading app, which can be found in the Apple App Store and on Google Play, as is the case with Binance, Bitpanda, Bitcoin.de or Coinbase. An interesting feature of many Bitcoin trading apps is the price alert, which keeps users informed about price movements.

If you want to have everything at a glance and not only want to trade cryptocurrencies, but also stocks and other securities via a trading app, the Justtrade trading app is an interesting alternative. You can find out more about the provider in the trading app comparison. EToro also enables stock trading via its app.

About the offer: Bitcoin trading at Just Trade *

Alternative to trading Bitcoins directly: Bitcoin CFDs

With so-called CFD brokers, you do not buy actual Bitcoins, but rather derivatives with which you benefit from price gains (or lose money in the event of price losses). This form of investment is similar to classic securities trading, but it is highly dynamic and therefore only something for investors who can and want to trade quickly and on a daily basis. Attention: The leverage factor of CFDs can result in large losses in the event of a negative price development - on the other hand, large profits can also be realized. For a longer-term investment, actual trading, i.e. buying Bitcoins, is better than CFD trading. Regardless of which path you choose: Bitcoin trading, like any investment, always harbors not only opportunities but also risks that you should be aware of.

About the offer: Bitcoin CFDs at eToro *

Buying Bitcoin: Tips to get started

You can find more tips on getting started in the crypto business in the articles "Buying Bitcoin: How to Invest in Cryptocurrency" and "Bitcoin: Taxes 2020". Do you prefer to invest in stocks, but still want to benefit from the Bitcoin boom? You can find relevant information in the "Buy Bitcoin Shares" guide.

* Our independent experts regularly deal with products and service providers. We will provide you with the resulting articles free of charge. COMPUTER BILD receives a small commission if you click on a link or conclude a contract with a linked provider. Note: The content on computerbild.de is not a specific investment recommendation and only contains general information. Authors, editors and the cited sources are not liable for any losses that may arise through the purchase or sale of the securities or financial products mentioned in the articles. Complex financial products such as CFDs in particular harbor a high level of risk: According to the company, 67% of retail investor accounts with eToro lose money when they trade CFDs from this provider. Regarding cryptocurrencies: These are not regulated and their prices can fluctuate widely. Therefore, cryptocurrencies are not suitable for all investors. The trading of cryptocurrencies is not subject to any supervision by the EU regulatory authorities. Your capital is at risk.

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