Our Official Guide to Trading Bitcoins in the UK

Our Official Guide to Trading Bitcoins in the UK

In this article, we’re going to show you how to trade bitcoin in the UK. It’s one of the most profitable short term investments that day traders now love. Using the volatility of Bitcoin, one can easily start trading for as less than $50 and grow from there. Even though it’s a tough market to understand, the platforms that offer Bitcoin trading have great educational programs.

What is Bitcoin Trading?

If you’re interested in knowing how to trade bitcoin in the UK, you probably already understand most of it. For everybody else, we’re going to explain what Bitcoin Trading is. When you trade Bitcoins, you’re not dealing with Bitcoins anymore. You would be trading CFDs of Bitcoin. So, what are CFDs?

Contracts for the difference – a CFD – is technically a unit that is traded on the platform. Essentially, this market is all about speculation. If you think that the price of an asset will rise, you purchase 10,000 units or CFDs to show that position in the market. Now, if the price actually does go up, you would make a proportional profit.

Conversely, if the market moves against you, you would be in a loss for your purchase of the 10,000 CFDs have been devalued. When you trade CFDs, you’re not trading the underlying asset, there’s no real world market access. You only buy CFDs, a speculative representation of the asset. The best part about trading CFDs is that you can go short as well as long. This allows people to invest in the long run as well as invest as day traders. That’s why CFD trading is a favourite amongst traders.

Is Bitcoin CFD trading legal in the UK?

Of course, the FCA monitors CFD trading to make sure that they are in line with the law at all times. The FCA continues to impose smaller spreads to ensure that customers of these platforms aren’t ripped off. What’s interesting about CFD trading in the UK is that the earnings are exempt from the UK capital gains tax. That’s why it’s quite interesting for traders to explore CFD trading.

How to Trade Bitcoin in the UK

eToro is a CFD trading website founded in Tel Aviv, Israel in 2006 by two brothers as a website for social exchange between traders. This, however, grew into an idea that they could create a trading website and pair the social aspect, making it a sort of Facebook for CFD traders. On the website, you can trade CFDs and connect with your favourite traders, you can follow them and their trades!

Yes, you can actually copy trades that high earning traders are doing; since all of their trades are posted on their wall. You can comment on a trade, start a discussion and even message traders. That’s what sets eToro apart from other CFD trading websites since eToro has a strong community within it which helps beginners to start trading and helps create a strong network.

Whilst writing this article, I started looking into the educational programs that they offer. The company offers live webinars on different subjects that anyone can watch and also e-courses on all the different types of trades available on the website. If you’re still not satisfied, it also has trading videos that you can watch if you come across an issue when using the website. These educational programs are really innovative for a CFD platform to include and it’s one of the greatest tools that eToro possesses.

Hopefully, this guide was helpful in explaining how to trade bitcoin in the UK. You can check out our full eToro review right here.

You can also read our ultimate guide for buying bitcoin !

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About Article Author

Michael Serrano
Michael Serrano

Michael is an engineer and a bitcoin evangelist. He has been involved in cryptocurrencies since 2013. His biggest wish? 1 billion users of bitcoin, ether and litecoin by 2020. In the last 10 years he has worked for various early-stage start-up as a back-end developer.

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