BTC (Bitcoin) trading operations involve buying, selling, or exchanging Bitcoin through various strategies and platforms. Here’s a breakdown of how BTC trading typically works:
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1. Types of BTC Trading Operations
A. Spot Trading
Buy/sell BTC instantly at current market prices.
Used for long-term holding or immediate transactions.
Example: Buying BTC at $60,000 and holding it in your wallet.
B. Margin Trading
Trade with borrowed funds to increase potential returns.
Offers leverage, e.g., 10x, meaning you can trade $10,000 worth of BTC with $1,000 of your own.
Higher risk due to potential liquidations.
C. Futures Trading
Agree to buy/sell BTC at a future date and predetermined price.
Can go long (buy) or short (sell) depending on market expectations.
Popular on platforms like Binance Futures, Bybit, and OKX.
D. Options Trading
Buy/sell the right (not obligation) to trade BTC at a specific price before expiry.
Used for hedging or speculative purposes.
More complex, often used by experienced traders.
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2. Key BTC Trading Terms
Order Book: List of buy/sell orders.
Bid/Ask: Highest price buyers offer (bid); lowest price sellers ask (ask).
Market Order: Executes immediately at best available price.
Limit Order: Executes at a specified price or better.
Stop-Loss: Automatically sells BTC at a set price to limit losses.
Take-Profit: Sells BTC to lock in gains.