Trade cryptocurrency CFDs with AvaTrade

Trade cryptocurrency CFDs with AvaTrade

With digitalization and technological advancements, more and more people are becoming part of the financial trading industry each day. These newcomers think that the financial trading industry is a really lucrative way to make a good income. They soon realize that trading is actually hard, as it requires a huge amount of market analyses, and if they don't trade with a lot of capital then the profits they make are usually small.

But there is one exception to this, the newly emerged cryptocurrency market. This is a speculative market, that does not exactly follow the complex geopolitical and economic state of the world in the same way as other markets. It is also highly volatile, which means that traders can make good profits even with a small amount of trading capital. So this is somewhat of a gamble that can generate really high profits, which is what attracts so many traders.

Because of this, many people started to look for financial brokers that offer cryptocurrency trading, and one of the best brokers among them has to be AvaTrade. This is a great platform that can become home to many traders. But what makes it so special, and why should traders trade here? Read our guide to find out everything you will need to know about AvaTrade.

Things to Know About Trading Crypto With AvaTrade

  • AvaTrade offers crypto CFD trading, so you will not be buying actual tokens
  • Being regulated by 8 regulators, AvaTrade is one of the safest places to trade crypto CFDs
  • AvaTrade does not offer high leverage on crypto CFDs
  • Traders can trade with 17 cryptocurrencies and 1 crypto index

Quick Overview of AvaTrade

Before discussing crypto trading with AvaTrade, first, let's look at AvaTrade and learn more about them. 

Founded in 2006, in the Republic of Ireland, AvaTrade was one of the first Forex trading platforms that offered its services to retail traders. Operating from Ireland means that AvaTrade is regulated by the Central Bank of Ireland. On top of that, they hold regulatory licenses from countries such as Australia, Japan, Poland, South Africa, Israel, and more. This makes AvaTrade one of the most regulated financial brokers on the market.

This is a platform that will leave every trader satisfied with their experience on the platform, and if you wish to learn more about them in general, you can read our AvaTrade review.

Trading Cryptocurrencies With AvaTrade

Just like most financial brokers that offer cryptocurrency trading, AvaTrade does not give traders the opportunity to actually purchase the tokens. When trading on AvaTrade, traders are trading with crypto CFDs and are making price predictions. With this, traders can avoid most complexities that come with cryptocurrencies and are just dealing with their price movements. Considering the fact that crypto volatility is what attracts most traders, trading with CFDs is probably the best option if you just want to trade.

AvaTrade cryptocurrency trading is available 24/7 as cryptocurrency markets don't close. This means that traders don't have to follow some special timeframe in order to trade and can trade whenever they think is the best time to enter the market.

AvaTrade also has no additional fees. When trading crypto CFDs on AvaTrade, traders can keep their positions overnight without paying any rollover fees. There are also no deposit and withdrawal fees. The only fees you might have to pay are fees charged by third-party providers and general spread fees.

Available Crypto on AvaTrade

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When it comes to available cryptocurrencies, AvaTrade won't be able to boast about the number of tokens they allow you to trade, but the tokens that are available are all highly desirable tokens that are good for trading. Here is the list of some tokens that you can trade on AvaTrade.

  • Bitcoin
  • Ethereum
  • Litecoin
  • Solana
  • Shiba Inu
  • Dogecoin
  • Bitcoin Cash

This is not a full list and in total there are 17 cryptocurrencies available on AvaTrade and one crypto index.

Crypto10 Index

What makes AvaTrade one of the best places to trade cryptocurrency CFDs has to be the Crypto10 Index. This is a benchmark of crypto Indexes as it represents the top 10 performing cryptocurrencies on the market by their market capitalization. It has a good weight distribution, with the majority of the weight going to coins such as Bitcoin and Ethereum. 

This is a great index to trade with, for those who want to trade with the cryptocurrency market in general and not specific tokens. And considering the fact that almost 80% of the whole cryptocurrency market capitalization is taken up by these top 10 tokens, It's easy to see why this index is a good tool to trade with.


Margin Trading

Being regulated by so many regulators and operating from the European Union, AvaTrade does not offer huge amounts of leverage in order to comply with its regulators' demands. AvaTrade offers leverage of 1:2 to traders who reside in the European Union and 1:25 for those that leave outside the EU.

This might be seen as negative, but if we take a closer look, it does not seem as bad. Cryptocurrencies are volatile assets, which means that even with a small amount of capital, traders can make good profits. So the need for leverage here is not as big as in Forex where low capital will never generate satisfying profits. Also, high volatility means that there are good chances to make big losses and if you are also using high leverage these losses can become catastrophic.

Account Types

AvaTrade traders have access to two types of general accounts. Retail and Professional accounts.

A retail account is what most traders are using. This is a basic account for those that are newcomers or don't have enough experience to be classified as professional traders.

But if you are a professional trader, you can gain access to the professional account, where traders receive lower spreads and other benefits.

AvaTrade also provides an option for Islamic accounts. Islamic traders who follow Sharia Law can turn their accounts into Islamic accounts, where they don't have to pay fees and interest rates as it's prohibited by Sharia Law. Also, CFD trading can be considered gambling as you are making price predictions without buying an actual asset. So Muslim traders need to be making careful decisions when trading crypto CFDs so as to not break any Sharia Laws.

Another great account type that traders can use is the Demo Account. Traders who are inexperienced and wish to learn more about trading before making any actual investments can use a demo trading account in order to try crypto CFD trading in a simulated market that moves the same as the real one, but here traders are trading with fake money to practice with.

Why Should We Trade Crypto CFDs With AvaTrade

One of the reasons why it's good to trade cryptocurrency CFDs on AvaTrade is that there are little to no fees that traders need to pay. Cryptocurrencies don't require any rollover fees and traders can easily keep their positions open overnight. There are also no deposit and withdrawal fees, and other types of fees that are present with most other brokers.

Trading crypto CFDs on AvaTrade simplifies the difficulties associated with regular crypto trading. Traders don't need to create crypto wallets and deal with security keys and other complicated elements of crypto trading. Also, most crypto exchanges are treated negatively by governments, but AvaTrade is not just any old crypto exchange, it's regulated by 8 financial institutions, which makes it a reliable and safe place to be.

If you are a Forex or Stock trader, it is a good option to diversify your portfolio. Considering the fact that these markets are not open all the time, traders can use these downtimes to trade with crypto CFDs and make additional profits.

Risks associated with Crypto CFD trading

We have talked about all the benefits that crypto CFD trading brings to us, but there are also some negative sides that we need to mention.

First of all, cryptocurrencies are speculative assets, which means that they don't follow traditional market trends and are not dependent on different factors such as geopolitics and economic situations. So it's hard to do proper market analyses, meaning that you are making more guesses rather than decisions based on facts.

We also need to mention the downsides of volatility. It can generate good profits, but it can also go the other way and cause us to lose our investment in a really short space of time. This becomes even more problematic if you are using leverage, as these losses get amplified.

“Derivatives in and of themselves are not evil. There's nothing evil about how they're traded, how they're accounted for, and how they're financed, like any other financial instrument, if done properly.” - James Chanos

Things We Learned From This Guide

  • AvaTrade is one of the best places to trade crypto CFDs
  • EU residents can use leverage of 1:2, and non-EU residents can use leverage of up to 1:25
  • Crypto10 Index is a great crypto index to trade with the whole trend of the crypto market
  • Trading crypto CFDs can be both a lucrative and highly risky practice

FAQs on Cryptocurrency CFD Trading With AvaTrade

What cryptocurrencies can you trade on AvaTrade?

Traders on AvaTrade can trade with 17 cryptocurrencies, among them are tokens such as Bitcoin, Ethereum, Solana, Dogecoin, and others. There is also the Crypto10 Index which consists of the top 10 cryptos by market capitalization.

Is AvaTrade good for beginners?

AvaTeade is a good trading platform for beginners. They have a simple design that makes navigating the website easy. They also have great educational materials that can be used by beginner traders to learn more about trading.