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  Profit from Bitcoin Crash: How to Beat a Bitcoin Crash Profit | News | Bit Updates
Home » bitcoin updates » Profit from Bitcoin Crash: How to Beat a Bitcoin Crash Profit | News

Profit from Bitcoin Crash: How to Beat a Bitcoin Crash Profit | News

Tuesday, December 5th, 2017 | bitcoin updates

The Bitcoin shorten – that is not necessarily interesting only for bitcoin skeptics. Even stocks that remained favorites in the long run have in the past occasionally set clear setbacks on the floor. After each rocket launch the courses run sometime hot. No reason, however, to sit idly by the crash or even realize losses. After all, profits can also be earned from price drops. "Bloomberg" has recently published a list of ways to shorten Bitcoin.


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Bet with CFDs against the Bitcoin

So-called contracts of difference, CFDs for short, are part of the world of derivatives. This is therefore a paper that reflects the Bitcoin price, but trading is based on no "real" Bitcoins. If you trade with a CFD, you are basically making a bet with your broker. In this way, investors can speculate that Bitcoin will fall – or rise – in the future.

As with all derivatives, investors also have a risk to underestimate in CFDs, as this type of investment is highly speculative. If you lose your bet with the broker – for example, the Bitcoin does not fall – this could be accompanied by the loss of your invested capital. Therefore, exercise caution before concluding the contract. As a rule, brokers and investors can freely agree on the values ​​underlying the CFD. In addition, there is the so-called issuer risk with CFDs. If your broker becomes insolvent, investors may suffer a total loss.
Bitcoin margin trading

Margin trading is a futures contract already offered by some Bitcoin brands such as Bitfinex. In this type of investment, investors must pay part of the traded value in advance as collateral. The more volatile, ie the riskier, an underlying, the higher is this requirement. Accordingly, the margin requirement is rather high for the fluctuating Bitcoin price.
Trade with Bitcoin Futures

The news that Chicago-based derivatives hub CME is soon launching Bitcoin futures has given Bitcoin a boost, as it is a big step towards further acceptance of Bitcoin on the market. Derivatives include futures in the highest regulation range. With a Bitcoin future, you can bet on a certain Bitcoin value at a certain time in the future. As announced on Friday, the CME plans to launch their Bitcoin future on December 18th.
Exchanged Traded Notes

Similar to Exchange-Traded Commodities, ETCs for short, ETNs are also derivatives that reflect the market value of a given underlying asset, such as Bitcoin. Unlike ETCs, however, ETNs are not collateralised with the original underlying, meaning you are not trading in "real" bitcoins. Since mid-November, Vontobel has already launched a first Bitcoin ETN, which can be traded on the Swiss stock exchange SIX. In doing so, investors can choose between long and short options that allow investors to either participate in a rising or falling Bitcoin price.
Borrow Bitcoin and resell it

It is already possible on some Bitcoin brands like Bitfinex. Here, investors can lend assets temporarily and arrange repayment at a later date. Investors are speculating that the assets, in this case bitcoins, are cheaper at the agreed repayment time – the classic short-shorts.
Away from the crypto-market: Bitcoin stocks short

If you want to participate in the Bitcoin price, but avoid the still relatively unknown area of ​​the crypto-market, you can do so via the detour of shares linked to Bitcoin. Chip makers like NVIDIA are closely tied to the Bitcoin price and behave similarly. The advantage for investors is that they can move along familiar paths and not have to move to the Bitcoin bars if they want to shorten the "Bitcoin shares" and set for falling prices. The security aspect is also not to be despised here: Even if the price of these shares is influenced by a falling Bitcoin, it is not certain that the share price will inevitably be just as extreme because there are other factors involved as well. In this way possible mis-speculation and the associated losses could be mitigated.

The bottom line is that a profit on a possible Bitcoin crash for investors is quite possible, but not without risk. Anyone who speculates on falling prices should therefore sound good about the risk of the targeted investment and have the best possible market knowledge.

Editors finanzen.net

Learn more: Buy Bitcoin – Here's how to do it: fromDUCK / Shutterstock.com, Lightboxx / Shutterstock.com, ppart / Shutterstock.com


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