The Bitcoin Basics

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Cryptocurrency Trading

Explaining BitMex Perpetual Contracts and Crypto Funding Rate

A Perpetual Contract trades like a Futures Contract, but never settles and never expires.

What is a Bitmex Perpetual Contract? 

Bitmex Perpetual Contracts are derivatives similar to classic Futures Contracts. These contracts enable crypto traders to speculate on both directions of the price of a cryptocurrency asset. Compared to Futures Contracts we can spot these differences:

  • Perpetual Contracts don’t expire (there is no daily settlement)
  • The price of a Perpetual Contract trades significantly closer to the underlying Index Price compared to a similar Futures Contract
  • The primary price-spotting mechanism of a Perpetual is Funding. This mechanism allows the perpetual contract to be priced very close to the price of the spot market (explained briefly below)

What is a Perpetual Swap?

A Perpetual Contract trades like a Futures Contract, but never settles and never expires.Perpetual Swaps are derivatives offered by the OKex exchange and trade similarly to Bitmex Perpetual Contracts. Again, they are like Futures Contracts, but without expiries and daily settlements.

Cryptocurrency Trading

BITCOIN MARKETS (CRYPTOCURRENCY EXCHANGES)

Cryptocurrency exchanges are common places to buy/sell Bitcoins and other digital coins.

Evaluating Cryptocurrency Exchanges

These are some key issues when choosing an exchange (every factor listed below is important):

BASIC CONCEPTS

  • Acceptance: -Does an exchange accept your country?
  • Verification: -What are the requirements for verifying? -What are the trading limits before/after verification?
  • Deposit/Withdrawal Methods: -What are the available fund methods (Cards, Online Wallets, etc.)?
  • Asset Index: -Which coins/tokens are available in the exchange?

SAFETY/RELIABILITY

  • Safety of money: -Where is the headquarters base? -How many years in the market?
  • Online security: -Are the cryptocurrencies of clients stored in cold storage, as they should? -In the case of P2P transactions, is there an Escrow Service?
  • Online reviews for this exchange: -What do other people say about this exchange (Caution, 50% of all the reviews you read are fake)?

COMPETITIVENESS

  • Transaction cost: -What are the transaction fees?
  • Exchange rate: -What is the exchange rate for the crypto you need to buy? -What is the ask/bid spread?
  • Responsiveness of the Customer Service

Cryptocurrency Trading

Bitcoin Tutorial for Starters -How to Trade Bitcoins?

Bitcoin, invented in 2008 by Satoshi Nakomoto, is the first and the most popular digital currency worldwide. You can trade Bitcoins in a Bitcoin Exchange (information at the end), but first here is some basic information about the Bitcoin currency.

 

Bitcoin General Information

Bitcoin ATMsBitcoin is an open-source decentralized currency allowing internet users to shop online or send money around the world. Bitcoin doesn't require a credit card or a bank account and can be bought, held, or sold 100% electronically.

These are some of the advantages Bitcoin offers:

→ A low-cost way to conduct business (tight fees)

→ No need for banking accounts or debit/credit cards

→ Wide acceptance worldwide

→ Secure and Anonymous Transactions via the Bitcoin Blockchain

→ Payments via Mobile Phone

How Do Cryptocurrencies Work in General?

An electronic coin is defined as a chain of digital signatures. Each coin owner transfers the coin to the next owner by digitally signing a hash of the previous transaction and the public key of the next owner and adding these to the end of the coin. A payee can verify the signatures to verify the chain of ownership.

How Does Bitcoin Actually Work?

Actually, Bitcoin transactions are based on a peer-to-peer payment network. Unlike any other payment system, Bitcoin is not controlled by any government or non-government organization. Due to the fact that Bitcoin is a peer-to-peer system, there is no need for 3rd parties. Each and every Bitcoin transaction is made via the Bitcoin software. Any internet user can download this software. You can download it here: » https://bitcoin.org/en/download

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