If you are someone who is investing in crypto or is just starting out, it is very important to recognize the different types of crypto markets. Each type of crypto market has a different way of trading and carries different characteristics. In addition to the difference in trading procedure, there is also a cost difference that needs to be considered. By understanding the differences, you will be able to assess which market is right for you to choose. There are several types of crypto markets, but the more popular ones are Spot trading and Margin Trading.
Spot Market Trading
The spot market trading system focuses on market prices, so traders who use this system will benefit from fluctuations in the value of their crypto assets. The increase and decrease of the value of the asset itself is influenced by the demand and supply of the assets. The more demand there is and the lower the supply, the higher the asset price will be. In addition to earning profits based on the price fluctuations from the spot market trading, you can also take profit based on the price differences on each of the existing crypto trading platforms.
In spot market trading, there are two types of users. The first is a market taker, which is an individual who buys crypto assets at real time prices so that the assets obtained can be directly traded. While the other type is a market maker in which an individual sets the desired selling or buying price. Purchases with this price setting will enter the queue and will be automatically sold or bought when the asset has reached the desired price.
The spot market platform on Tokenomy is a crypto-only trading platform. Users can only trade one cryptocurrency for another.
Margin Market Trading
For margin market trading, the system is different from the spot market. Traders can trade from 2 directions, so traders earn profits when the market price goes up or down. In this type of market, users can use a capital loan system with a certain value. The available margins also vary, depending on the platform you are using. For example, a platform may offer a capital loan with a margin of 10x. This means with a capital of 1 Bitcoin, you will be able to trade up to 10 Bitcoin worth.
In margin trading, there are also long and short positions. Long position is done when we believe the price will potentially increase. While a short position is done when we believe there is potential for price decline.
With TokenomyX, you can enjoy the convenience of margin trading with complete features.