Binary options are a pretty popular financial instrument that allows you to make significant profits just by predicting how the price of a certain asset will behave in the near future. These options are based on many different underlying assets, including cryptocurrencies. Such derivatives work very similarly to the common ones: you pick a token, make a guess about its price, make the corresponding trade, and wait for the outcome. In this article, we explain how to trade BTC options.
How it works
Binary options are derivatives that allow you to bet on the price of an underlying asset. Basically, this instrument works like this: you need to guess whether the price will be higher or lower than a certain level at a given time. Then, there may be just two different outcomes, and that’s why the options are called binary. If you are right, you will retain your bet and earn a reward that may be as high as 70% or even 80% of your bet. If you are wrong, you lose all your money. That’s why this instrument is so risky: several wrong decisions, and your deposit is gone.
Of course, if the price of an asset is known to be volatile, trading binary options with this asset as an underlying one becomes even riskier: the market is just too unpredictable. And crypto is known to be one of the most volatile assets. While that makes it a perfect asset for earning extreme rewards, you need exceptional skills and much experience to do that successfully. That means you shouldn’t try to master Bitcoin binary options trading without a clear understanding of how to do that. So you should really study how Bitcoin works and what affects its price in the long term.
Getting started
If you feel that you already know enough about crypto and Bitcoin in particular, you may be ready to try and trade BTC binary options, since it’s a great opportunity to earn. However, you should actually start small: try your hand with a free demo account. Nowadays, there are many brokers who can give you access to the real market and a handful of virtual coins to try your luck. If you manage to trade on a demo account without serious losses, that is a sign that you may succeed on a real account. Then, it’s very important to choose the right broker. Make sure your broker allows you to trade BTC options and check out its trading conditions and fees. Don’t forget about security measures, too.
