#TradingTypes101

Cryptocurrency trading can be conducted in various ways, each with specific characteristics and risks. Spot trading is the simplest form: a digital asset is bought or sold at the current market price, and ownership of the asset is transferred immediately. It is ideal for beginners as it does not involve leverage or expirations.

Margin trading allows users to trade with borrowed funds, increasing their purchasing power and potential profits, but also their risk of loss. Here, the trader must maintain a minimum margin to avoid forced liquidation.

Finally, futures trading involves contracts that speculate on the future price of an asset without owning it directly. This type of trading allows for leverage and can be very profitable, although it comes with high volatility and risk. It is popular among experienced traders looking for more advanced strategies.