A broker is a person or organization acting as an intermediary between two parties who complete a transaction. This is an intermediary service that is offered online through trading platforms. They and brokers can support a number of different assets. Unlike cryptocurrency exchanges, which offer only digital currencies.
The broker works in accordance with the instructions of clients, using their money in transactions. For his services, he receives a certain fixed fee or interest. In addition, many of them provide only Forex trading, but also often offer various derivatives from stocks or commodities to indices, as well as other assets such as cryptocurrency.
Also, all leading online brokers have regulations by organizations such as the Commodity Futures Trading Commission (CFTC) in the USA or the Financial Conduct Authority (FCA) in the UK. This means that they must be licensed, meet very high standards, regularly audited and include a high level of security measures for their users.
In turn, cryptocurrency exchanges are unregulated and they do not have a third-party regulatory body that monitors their activities. Because of this, they often become targets for hacking and cyber attacks.
Popular cryptocurrency pairs and their selection
In fact, an online broker does not offer as many cryptocurrencies as an exchange. Instead of offering a full package of assets, they trade only a few and also tend to provide access to better pairs of cryptocurrencies, such as ETH / GBP, BTC / EUR, and others, which you rarely can find on exchanges.
The broker can advise or pick you a cryptocurrency pair or crypto coin for trading based on your personal preferences, goals and financial capabilities.
Automation and Copy Trading
Automatic trading is carried out according to algorithms created on the basis of the knowledge and experience of traders from around the world. Thus, you can use ready-made proven schemes at any time that you don’t have to learn for a long time.
All the best and most modern brokers now offer trading robots and other automated trading solutions. This method can often be found quite soon in almost all forms of trading, except for trading digital currency on exchanges.
Automated trading programs were developed based on the real experience of different traders. Programs (or advisers) use different modules that analyze and process indicators and charts on the market.
Copy trading is actually not the same, although both methods have much in common. It is the action of one trader that copies the transactions of another.
Copy trading is also well suited for inexperienced traders. If you are new to the world of trading in the financial markets, then most likely you will act slowly and carefully while learning to trade correctly. By copying the trades of other traders, you get their experience that will guide you through each trade.
Copy-trading also saves a lot of time. Technical and fundamental analysis has been and will continue to be popular in trading. Moreover, when you have trades that you can copy, you can reduce the amount of analysis needed.
In conclusion, it should be noted that choosing a good and adequate online broker is an important task for every trader. The determining criterion, as a rule, is the availability of a license, trading conditions, commissions and other services and capabilities of a broker.