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For me learning about CFD trading is another step in crypto trading.

Previously I shared with you my journey about trading using paper trading platforms and derivative exchanges.

Today in this post I’m going to share with you a type of derivative trading called CFD (Contract for Difference) and platforms that I found to be the best ones to do CFD trading.

Ok, let’s dive in.

What Is CFD Trading?

CFD’s full abbreviation is Contract for Difference. It is a popular form of derivative trading.

But CFD stands out from other forms of derivatives like features and options where the underlying price of an asset is taken into consideration to trade instead of CFD calculated by the movement of an asset between trade and entry.

In layman’s terms, CFD lets you speculate on the asset price, so your profit or loss is determined by the difference between the price you buy at and the price you sell at. If you were right about the direction of the price movement, then you make a profit; if you were wrong, then you make a loss.

For example, if you want to speculate on the price of Bitcoin in dollars, you have to take a contract with your Broker on the Bitcoin dollar price. If you think the Bitcoin price is going to rise, you take out a long position; if you think it’s going to fall, you take out a short position.

The Major benefits of CFD trading are; you decide when to sell the contract, and the trades can be short-term even on a minute-by-minute basis, or long-term, for a month or even a year. But they don’t expire.

Another benefit is leverage, which means you can make a relatively small outlay to take out leverage of up to 100x to increase their exposure. The risk here is if you win this maximizes your profits. But if you lose it also maximizes your losses.

Ok now you have a complete picture of CFD but to trade in CFDs you need brokers, here I listed the best CFD brokers.

List of Best CFD Brokers.

1. eToro.

eToro is an Israel based company that started to operate in 2007 they let you trade on everything from stocks, cryptos, and commodities.

Moreover, eToro branded as a social investment network means you can see and follow successful portfolios and the platform is also regulated by FCA and Cysec authorities.

When it comes to crypto CFDs eToro is crowned as the largest crypto CFD broker having more than 50 crypto assets available with an option to go 100x in leverage.

One big advantage of trading with eToro is you get vast options to deposit cash using credit card, PayPal, ACH, or wire transfers, etc.

But one hurdle you face in eToro is if you’re a US citizen then eToro doesn’t serve you because of regulatory barriers.

2. Plus500.

If you’re looking for an easy to use beginner friendly CFD broker, then Plus500 is for you.

The platform has been operated since 2008 registered in the UK and licensed by the Financial Conduct Authority.

Plus500 only offers CFD trading, also the first broker to introduce the Bitcoin CFD in 2013 other than cryptos they offer forex, stock indices, individual equities, commodities, ETFs, and options.

Before beginning to trade remember one thing Plus500 is not a crypto exchange or traditional brokerage means you cannot actually purchase cryptocurrencies on this platform. What you can do, however, is bet on their prices and expect to get decent liquidity.

You can fund your Plus500 account with a credit card or Skrill account and expect it to not go to zero because of the negative balance protection in place.

And for now, with Plus500 you can trade on Bitcoin, Ethereum, Bitcoin, Litecoin, NEO, Ripple XRP, IOTA, Stellar, EOS, Bitcoin Cash, Cardano, Tron, Monero, Crypto 10 Index, etc.

3. PrimeXBT.

This Bitcoin CFD exchange is new to the market compared to the above platforms started in 2018 in Seychelles.

Even new to the market PrimeXBT gained popularity in 2019 because of the customer support and beginner and intermediate friendly UI design.

As a beginner, I liked their Turbo platform, which is easy to understand, with no fancy charts and tone of options. It allows you to take a position on an asset over a while for a defined gain.

The platform offers a variety of CFDs to trade. Including cryptos like Bitcoin, Ethereum, Litecoin, Ripple, EOS, stock indexes (S&P500, FTSE100), commodities, and forex all in one place.

Here you can watch a quick video to get a better insight into PrimeXBT.

For depositing platforms partnered with CEX and Coinify for Bank and Card or you can transfer Bitcoin directly to the PrimeXBT wallet.

But for the withdrawal, PrimeXBT keeps limited cryptocurrencies in the hot wallet, and the rest are in the cold wallet. It processes all pending withdrawals once daily between 12:00 and 14:00 UTC. If you request before 12:00 UTC, it will be processed on the same day itself; otherwise, it will be processed the next day.

4. BDSwiss.

Started back in 2012 and is extremely well-regulated around the world by CySEC and several other top bodies.

You won’t face any restrictions to access the platform because BDSwiss provides trading services in more than 180 countries worldwide and is considered as a major forex broker.

They offer 20 crypto CFDs, including crypto assets like Bitcoin. Ethereum, Litecoin, NEO, and others against many currencies, including the US Dollar, Euro, and Japanese Yen with leverage of 1:400.

Other than cryptos, you can also trade in 250 assets and 50 forex currencies with both Metatrader 4 and Metatrader 5 offered by the platform.

To start trading in BDSwiss you have to deposit a minimum of $100, and all major payment methods are available. Including Bitcoin and Stablecoins (only for deposit) or you can use the demo trading if you’re a beginner like me.

5. AvaTrade.

AvaTrade is the oldest platform on our list started in 2006 and is regulated by Irish law, specifically the central bank of Ireland, which regulates CFD and forex brokers.

With AvaTrade you can trade in different cryptos like BTC, BTG, BCH, XLM, LTC, ETH, XRP, IOTA, EOS, and many more with the leverage of 1:400 but you can’t buy Bitcoin on AvaTrade you only trade them through CFDs also crypto CFDs are not available from any broker’s UK entity, nor to UK residents.

Being one of the old platforms AvaTrade has more than 60 major, minor, and exotic currency pairs to choose from and 20 of the major indices from countries around the world, all traded as CFDs. Plus, Japanese and Euro bond markets are also available to be traded as are more than 100 stock CFDs from major companies listed across the globe.

For deposits, AvaTrade supports all other payment options such as Debit and Credit Cards, Skrill, Netbanking, and Neteller.

Conclusion.

CFDs are the best options to trade without owning cryptocurrency and for making a huge profit by leveraging a small portion of funds.

However, you also know that the huge profit is proportionate to huge losses so trade with caution.

And the CFD brokers I listed above provide a range of assets that you can trade.