Younger and in search of volatility, the investor profile shows a real craze for digital currencies and a risk appetite.
However, the world of crypto assets has been democratizing at an impressive speed in recent years. Crypto trading requires going through a reliable trading site, which is not always easy. In this comparison, we will give our opinion on the best crypto-broker available for trading digital assets on the trading platform.
What is a cryptocurrency broker?
As with other asset classes (stocks, ETFs, forex currency pairs, indices, etc.), trading cryptocurrency forces you, as a trader, to go through a specialized intermediary. A crypto broker’s job is to carry out the orders of their clients to buy and sell 100% digital currency on the market.
There are several forms of cryptobrokers:
- Internet providers, allow them to reproduce the price fluctuations of crypto-assets using derivative products (CFDs).
- PSANs, where we can trade cryptocurrency in real time.
Is it better to trade cryptocurrencies live or via CFD?
Most of the time, it is better to trade the underlying asset directly instead of a derivative product that just copies its value in real-time. However, the choice is not that easy and depends on a lot of factors.
Investing involves risk. We have to make sure we understand how financial instruments work and that we can afford the risk of losing our money. Up to 73% and 89% of retail investor accounts lose money when trading CFDs.
Crypto traders who want to get the most out of their investments can use leverage to trade cryptocurrency CFDs up or down with a multiplier of 2. This means that we can trade with twice as much money as we have in our trading account. Leverage is meant for experienced traders who know that it can also make losses worse.
On the other hand, because of the growing risk of cryptocurrency trading platforms being hacked, some traders prefer to turn to CFDs for more security. a solution to trade cryptocurrencies without actually storing them in a “wallet” and therefore without fear of being stolen by attackers. An alternative includes choosing a serious and regulated broker.
On the other hand, owning cryptocurrencies directly allows them to “flow.” In other words, it gives us the chance to take part in operations that make the blockchain more reliable and get more tokens in return.
Finally, it allows us to invest for the long term and save them without daily swap fees on our positions.
How to choose the best crypto broker?
If we choose an unreliable broker, there is a chance that money will be stolen, the broker will go bankrupt, or we will have trouble getting the money back. Choosing a broker who specializes in crypto trading is, in fact, a very important decision…
To help us choose the best crypto broker, we should carefully consider the following points before opening a live account:
- Crypto-broker history and regulation
- Opinions and comments posted by customers (forums, google listings, keyword searches on Twitter, etc.)
- Number of crypto tools available on the trading platform
- Fees and commissions for the crypto assets you intend to trade
- Ease of use with the trading platform and the formats offered (PC, tablet, mobile, etc.)
- Availability of educational content (webinars, guides, etc.) to support you in learning crypto trading
- Availability of support service
In this regard, we have the opportunity to read the white list of PSANs registered with AMF. This implies better protection for crypto traders, as well as a blacklist of players who are not allowed to offer their crypto services in the EU.
Our opinion on the best crypto broker
Choosing the best crypto-broker starts with understanding whether we prefer to trade cryptocurrency directly or through leveraged CFD contracts.
Once this first sorting has been done, our vigilance should focus on the reliability of the broker and its ability to protect funds (regulation, additional insurance, market share in the EU and worldwide, etc.).
In the end, our choice will be based on which crypto broker is the cheapest, has the most important features, and can teach us about and help us use the trading platform.
With this comparison, we can find the best crypto-broker for trading CFDs on digital assets. Like finding the best crypto-broker for real-time digital currency trading.
Comparison of spread fees at the best cryptocurrency CFD brokers
To get paid, the best crypto brokers display more or less spreads depending on the intermediary you open an account with.
For example, we decide to buy 1 lot of bitcoins, whose price offered by the broker is 50,000 euros.
This means that after purchasing, if we want to resell your bitcoin lot immediately, we can do so for 49,890 euros at broker 1 and for 49,500 euros at broker 2. In other words, the spread is the cost of this transaction of 110 euros at #1 and 500 euros at #2.
Frequently Asked Questions
What is PSAN?
PSAN is an acronym for “digital asset service provider. It is awarded by AMF to financial intermediaries whose activities comply with the rules and who wish to manage, hold or allow their clients to buy/sell cryptoassets on a trading platform. Not to be confused with AMF approval, which is optional and gives broker clients a higher degree of protection.
What is a KYC check?
KYC is an acronym for “Know Your Customer” or “Know Your Customer.” This process, which is required for platforms that trade cryptocurrencies, is meant to stop money laundering by letting middlemen track the flow of money in digital currencies.