Cryptocurrency trading is a growing industry as more and more investors seek to diversify their portfolios with alternative assets. Among the most popular are securities linked to cryptocurrencies, such as Bitcoin and Ethereum.
Many traders have found that traditional brokers and exchange-listed stocks don’t offer the same liquidity or trading features that cryptos do. For that reason, many investors choose to trade cryptocurrencies directly.
Some of the largest crypto exchanges allow you to buy and sell all the hottest currencies, including Ethereum, Ripple, XRP, BTC and Dogecoin. These platforms typically charge a relatively low fee of 1.5 percent or less. Some of these fees are waived for those who use their credit cards and fund their accounts through a bank.
Other specialized cryptocurrency exchanges also charge lower fees. For example, Binance offers a flat-fee structure for buying and selling digital currencies, with the rate declining as you trade more.
Webull is a full-service brokerage that offers direct trading of both stocks and options, as well as indirect ways to invest in cryptocurrency through a wide array of securities and futures products. It’s a great choice for anyone who wants to get a handle on the crypto space and has some experience investing in stocks or options.
If you are a more experienced investor who is interested in learning about cryptocurrency, Webull offers several courses. In addition, it has a Learning Center that includes self-help resources for beginners.
Brokers offering direct crypto trading are gaining in popularity as investors look for new ways to diversify their portfolios. This is especially true in the U.S., where the broader economy has become increasingly correlated to stocks and bonds, making these uncorrelated assets more appealing.
For example, a fund called the VanEck Bitcoin Strategy Fund tracks the price of a Bitcoin futures contract. It costs just $43 per share and is available from E*Trade.
Another ETF option is the Siren Nasdaq NexGen Economy Fund, which trades a basket of companies that are advancing blockchain technology. The fund has a Morningstar rating of 3 stars and pays a dividend.
While there are a few cryptocurrency-related offerings on the E*TRADE platform, they tend to be indirect ways to invest in the crypto space.
These include security futures, exchange-traded notes and ETFs that track the price of certain cryptocurrencies. These investments can provide a more traditional way to gain exposure to cryptos, but they are highly risky and may not be appropriate for all investors.
The E*TRADE platform also offers a handful of security futures that track some of the biggest and most popular cryptocurrencies, including Bitcoin. These futures trade on a market-maker basis, so the price of these futures is determined by demand for the product.
While the underlying cryptocurrencies themselves aren’t regulated, these futures products are. The markets for these products are extremely volatile, and you may lose money if the value of a particular product declines. This is because the value of a crypto can change very quickly, and the price can move in different directions on different exchanges. The underlying value of these products depends on the supply and demand for the cryptocurrencies themselves, which can be subject to changes in laws.