Cryptocurrency

Cryptocurrency Contracts for Difference (CFDs)

What Are Cryptocurrencies?

Cryptocurrencies are virtual currencies. They operate independently of banks and governments, but they can still be exchanged or traded like traditional fiat currencies. They are based on blockchain technology, which is open source and peer-to-peer, so there is no need for intermediaries for transactions.

The original and most well-known cryptocurrency is bitcoin, which was launched in 2009. However, there are now a number of competitor digital currencies that can be traded, exchanged or speculated on, much like any physical currency.

How can I trade Cryptocurrencies via a CFD?

With ADS Securities, you can trade a cryptocurrency CFD on

  • Bitcoin
  • Ethereum
  • Ripple
  • Litecoin
  • Bitcoin Cash

Normally, cryptocurrencies are traded via exchange, and require a ‘virtual wallet’ to hold them. These can be slow to acquire, restrictive to use and expensive to maintain. However, ADS Securities’ clients can trade cryptocurrencies via a CFD without taking ownership of the underlying cryptocurrency.

Simply log into your ADS Securities trading platform to access our cryptocurrencies, all of which will be quoted against the US dollar (USD). When you open a CFD position, rather than taking actual ownership of the cryptocurrencies, you will trade on whether the price of the cryptocurrency will rise or fall in value in relation to the US dollar. As with any CFD, if you are correct, you will profit; if you are not, you will make a loss.

The Advantages of Trading a Cryptocurrency CFD with ADS Securities

  • Trade on leverage, with margins starting from 25%
  • Flexibility on trade size – minimum 1 CFD equals 1 unit of the cryptocurrency
  • Go long or short – capitalise on uptrends or downtrends in price
  • Pricing available to all clients on our trading platform
  • Simple account opening & funding process
  • Customer service 24 hours a day, 6 days a week

CFD Trading Example

If you are interested in trading cryptocurrencies via CFDs, the following examples will help explain how it works. If the selling price is $11,500 and the buying price is $11,550 for 1 bitcoin, and you believe that the bitcoin’s price will fall against the dollar, you may decide to sell 10 bitcoin contracts at $11,500 – for ease of reference, each of our CFD contracts is equivalent to transacting in 1 bitcoin.

Scenario A

The bitcoin price falls and our new price is $11,300/$11,350. You decide to take your profit by buying at $11,350.

$11,500 – $11,350= $150 move or 150 points

Your gross profit is 10 contracts x $150 = $1,500

Scenario B

The bitcoin price rises and our new price is $11650/$11700. You decide to close your position by buying at $11,700 to limit your losses.

$11,700 – $11,500= $200 move or 200 points

Your gross loss is 10 contracts x $200 = $2,000

Cryptocurrencies, including, without limitation, Bitcoin and Ethereum, are subject to a very high degree of uncertainty and price volatility. Investors in cryptocurrency CFDs are exposed to a number of additional risks not present in more traditional investments. These risks are set out in our Cryptocurrency CFDs – Additional Risk Warnings & Conditions, you should note that this is not an exhaustive list.

Educational Platform

Learn How To Trade CFDs

Try our interactive CFDs trading courses to help you learn how to analyse and trade the market like advanced traders do. Everything is covered, from basic concepts to advanced skills.