There are two ways to start your bitcoin trading adventure in South Africa and we are going to enlighten you about the two methods below.
First of all, you can decide to purchase bitcoin via an exchange and then store it in your bitcoin wallet. Then you can wait for bitcoin to rise in value after which you can sell it for a profit. While this is a very good way to start trading bitcoin, it has got its own disadvantage; you may lose your bitcoin if the bitcoin wallet you are using is not secure. Other risks are the exchange fees and the particular exchange you are dealing with for Bitcoin trading South Africa.
The second method of trading bitcoin is as a CFD instrument on Forex brokers’ platform. You can do this just like Forex trading and this means you will not have to buy the asset. There are many brokers offering leveraged bitcoin trading as CFDs for individuals interested in BTC trading in South Africa. We will consider 5 of these brokers in the course of this write-up.
Best Four bitcoin trading brokers in South Africa
Plus500 is the best among the five for BTC trading in South Africa. Some of its features are highlighted below:
- The trading fee is variable and ends on the particular trade
- The minimum deposit is R1500
- Also, the broker is regulated by FCA, CySEC and ASIC
- The platform offers up to 14 cryptocurrencies for CFD trading
Plus500 is regulated and South Africa trades are welcome on the platform. All the regulators mentioned above are tier-1 regulators and the cryptocurrencies supported on this platform include Bitcoin, Ethereum, Ripple and 11 others.
The broker offers the highest number of cryptocurrencies for CFD trading among the best 5 mentioned earlier. The maximum leverage offered here is as high as 1:30.
Some of the cryptocurrency CFD pairs offered on this platform for those interested in bitcoin trading South Africa are highlighted below:
- And so on.
The crypto CFD pair you trade can determine the trading fees to pay. However, the fee tends to be higher on this platform than others.
- The platform is regulated by tier 1 regulators, like CySEC, FCA and ASIC.
- The trader can access up to 14 cryptocurrency CFD pairs on the platform.
- The minimum deposit is just R1500 and there is no fee on withdrawal or deposit.
- The platform is available on the web and also mobile. It is equally user-friendly.
- The guarantee stop loss and negative balance protection make it reliable for bitcoin trading in South Africa.
- The customer support is good and you can get in touch 5 days 24 hours from Monday to Friday via email and live chat.
- The trading fee tends to be higher than what obtains on any other platform.
- The average trading fee is 30 units per BTCUSD trade
- The minimum despot is $5
- The broker can be trusted for trading Bitcoin because it is regulated with various brokers, like CySEC, FCA and FSCA
- The platform offers 7 crypto pairs, which are BTCUSD, XRPUSD, BTCEUR, LTCUSD, ETHEUR and LTCEUR
- The platform is regulated by FSCA, CYSEC and FCA
- It offers up to 7 cryptocurrency pairs for bitcoin traders
- Quick order execution
- Trading fee is 30 units per BTCUSD on average
- Limited standard trading hours from Monday to Friday. As a result, no trading on weekends.
- Average BTC trading fee is $10 for BTCUSD trade
- $200 minimum deposit
- Broker is regulated by ASIC
- The trader can access up to 10 cryptocurrency pairs also.
IC Markets Pro:
- It is regulated by ASIC, which is a top tier regulator
- Access to 10 crypto pairs for CFD trading
- Very tight spread per trade
- It is an ECN for bitcoin trading South Africa
- No fee on withdrawal or deposit
- Very good customer support available 5 times in a week
IC Markets Cons:
- There is no negative balance protection
Helpful guide for newbie South African bitcoin traders
What is Bitcoin?
BTC remains the largest crypto in the world today by market cap. It was released by Satoshi Nakamoto in 2009. It is a decentralized system and it is, therefore, not controlled by anybody.
The peer-to-peer transaction is stored in Blocks in what is called blockchain and it is maintained publicly by bitcoin.
Cryptos are digital stores of value and can play the role of means of exchange for financial transactions. Bitcoin is increasing in popularity and it has a highly volatile price movement. BTC is traded by many experienced and new traders as a speculative instrument because of its popularity.
What are BTC CFDs?
CFD stands for Contract for Differences (CFD). It represents an arrangement allowing traders to trade Bitcoin without owning the asset. The Forex traders, can, therefore, speculate on the movement of the price of any instrument to anticipate its price, as well as, speculate bet. The trader will open a sell position on bitcoin against the USD if he speculates that the price will fall. The reverse is the case if he speculates that the price will rise.
Cryptocurrency CFDs refers to situations in which the underlying asset of the CFD is a bitcoin or any other cryptocurrency. The trader will be able to speculate and trade on bitcoin price against USD using BTC CFDs.
You do not have to exchange the assets physically before you can trade them. When you venture into Bitcoin trading South Africa as a CFD, there is no need to worry about wallet security and the fee on trading will be regulated by the broker; the fee is usually very low.
How to trade BTC in South Africa
Before you start trading BTC in South Africa, you should first go learn the rope through a demo account. You should not go live until you have built your confidence and prepared a reliable trading strategy. When choosing a broker for bitcoin trading, make sure that you only consider those brokers that are regulated; it is also important to go for a broker regulated by a tier-1 regulator. It is better to register with one regulated by a broker in South Africa; that is, the FSCA (Financial Sector Conduct Authority) brokers regulated by global regulators are also ok, like CySEC, ASIC and FCA.
You will not have a problem finding good brokers regulated by these bodies that also offer Bitcoin and several other cryptocurrencies in South Africa. You can easily trade bitcoin as a CFD with any of such brokers and you can open a position against fiat currencies like EUR and USD. The crypto pairs can be in the form of BTCEUR, BTCUSD and so on. It can equally be in the form of BTCETH, in which case you will be carrying out bitcoin trading against Ethereum.
Additionally, you can access leverage on BTC brokers platforms. The leverage works just as it the case in Forex trading. The leverage can equally be between 1:2 and 1:10, the low leverage offered by the brokers is due to the high volatility in the crypto market. Many experts advise against using leverage higher than 1:2 when trading BTC CFDs or any other cryptocurrency CFD for that matter.