Cryptocurrency vs Forex: What’s the Difference? | Finance Magnates
While it was dismissed as a passing fad,
Cryptocurrencies have surged in popularity, and traders have taken notice. But should you shift your focus from Forex to Crypto?
Or try to leverage both markets to maximize your opportunities? Before you answer that, read on to explore what these two have in common, and how they are different in many ways too.
Where Crypto Markets and Forex Markets are alike
Anyone who wants to begin trading will first need a trading account and an internet-connected device such as a smartphone, laptop or tablet.
Those who already understand the fundamentals of Crypto trading will find it easy to transition into Forex trading, and the same is true for Forex traders looking to try Crypto trading.
Both markets are determined by the supply-demand balance – prices rise when there are more traders buying a unit than selling, and prices drop when more traders sell than buy.
This makes it easy for traders to transition from Crypto to Forex as the indicators and chart patterns are similar.
Where Crypto Markets and Forex Markets differ
Despite the many common aspects of the two, there are several key differences you should look out for. These include:
Difference in Available Instruments
There are also certain traders who choose to trade exotic currency pairs, such as a major currency and a currency of a developing economy like Madagascar or Peru.
On the other hand, with over 11,000 different cryptocurrencies and growing, Crypto trading is a whole other ball game. But while most trade in Bitcoin or Ethereum, hard-core crypto enthusiasts might dabble in lesser known assets.
This means that it’s unfeasible to track every…