The eToro trading platform has notified its customers through emails that it is moving away from CFDs as the option it has been offering to those who wanted to make money through the cryptocurrency market. The company is instead moving to the actual underlying assets.
The emailed announcement revealed that eToro will no longer offer the cryptocurrency CFDs option but will instead allow those interested in trading cryptocurrency on its platform to hold the assets themselves. The decision to move towards that direction highlights the trading platform?s decision to venture fully into the cryptocurrency market, thus its long-term interest.
The announcement revealed that all the CFD holdings of the clients will be transferred to the underlying assets without any leverage. This means all the long crypto positions will also be upgraded and this will also affect all the cryptocurrency positions that were opened as a result of a copy relationship. The letter also stated that the new changes will be implemented between the 15th and 20th May and these changes will be implemented in every country except in China. This is most likely due to China?s ban against cryptocurrency trading.
Numerous brokerage firms have chosen to use CFDs rather than offering traders the option of directly trading the cryptocurrency assets. The reason for this approach is to provide their clients with a way of taking advantage of the potential gains that the cryptocurrency market stands to offer directly trading the asset due to the highly volatile nature of the market. However, this approach is characterized by high fees charged by the exchanges in order to hedge their exposure especially for positions that are left open overnight.
eToro clients will now be able to trade cryptocurrency assets such as Bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC) which are currently among the most popular cryptocurrencies in the market. It will also include others such as Neo (NEO), Dash (DASH), Stellar (XML), and Ripple (XRP). Forex platforms have been quick towards bringing exposure to the cryptocurrency market and their advantage is that they offer advanced trading strategies. Some of these strategies include shorting so that customers can bet on the probability that the price will fall.
Disclaimer: Nothing in this article should be construed as financial advice in any way, nor as an encouragement to engage in cryptocurrency trading activity. This article was not sponsored by any entities or companies mentioned in the article. The only purpose of this article is to inform/educate on the topics discussed in the article.
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