When you are dealing with bitcoins you should know one thing for sure, that trading bitcoin has no actual bitcoins are involved. It is just future contracts that are to be settled financially that too in cash. Bitcoins in actuality does not exchange through human hands. It does not go from a leather wallet to each other. The BITCOIN CRAZE IS NOT AT ALL GOING TO WANE ANYTIME SOON
When the contract holder, the spectator is in a position to show the profit on the trade on the expiry or the delivery date, then the difference between the price purchase and settlement price is paid out to the contract holder.
MINIMUM FLUCTUATIONS FOR BITCOIN FUTURES: $25/contract and $5/calender spread
How to buy bitcoins?
It is very easy to get hold of the bitcoins in many ways. Mining was one of the most popular way of getting bitcoins. However, the amount of bitcoins bought were increasing drastically as it gained popularity, mining became a very difficult process.
The most easiest method to buy bitcoins is via Bitcoin exchange. The exchanges is where people sell or buy their bitcoins with facilities to process every trade in return of a small commission. The commission is sometimes negligible.
Here is a step by step guide:
- OPEN A WALLET
As stated above, there is no real physical Bitcoins. Hence the place where it is stored is known as a digital wallet since Bitcoins are themselves digital. In a digital wallet you can interact with other buyers and sellers as well. the most powerful wallet in the market today is Blockchain.info. There are numerous other providers. Make sure you choose a provider who provides strong security.
- Registration and account
Enter your choice of trading website. You can choose CME or CBOE or CEX.IO website. Register on the website and then open an account by providing the right details they ask for in every step.
- CFA CODE
Once the details and information is provided, some sites will send you an authentication code via your service messages. The code will be generated instantly which you will have to enter on the website.
- Confirmed account and trade
Once the CFA code is verified then you can start trading. You can trade bitcoins in general or you can buy Bitcoin futures. Put an amount when buying normal bitcoins or when buying bitcoin futures put the amount of dollars that shows on the agreed contract and pay it by the payment option that you are comfortable with. You can pay by Card which is VISA or MASTERCARD. Otherwise, bank transfers are accepted in every website or exchange.
To complete the purchase you need to verify your identity. Hence you will have to provide your broker with valid documents and details. For this you might have to enter in your document serial number, your country, ID type, Tax reference number, Document issue date and expiration date.
Normal or regular money can be used to by Bitcoins. Not only that, now a days there are facilities which let you buy Bitcoins with Cash! Local Bitcoins is an exchange with which it is possible for the investor to buy bitcoins in cash. Once the investor provides with the proof of the cash deposit, the bitcoins are automatically sent to the investor’s wallet.
Know your exchange well. while forming the contract for futures, know the terms and condition. Keep track of the charts as it is possible to sell away the contract even before the expiry date. Exchange security policies are a very important thing!