Trading Cryptocurrency with AvaTrade: Everything You Need to Know

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Crypto trading is moving into the mainstream. AvaTrade is a full-service broker that has great cryptocurrency trading options. Depending on how you trade, and your crypto investment goals, AvaTrade could be the perfect broker for you.

AvaTrade is primarily a CFD broker. CFD stands for ‘Contract For Difference‘ and CFDs are a form of derivative. If you trade cryptos with AvaTrade, you will be trading with the broker in derivative products.

CFD trading has many advantages.

Depending on where you live, CFDs may be better from a tax perspective. CFDs are also extremely liquid, which is great for high volume traders. As an established broker, AvaTrade also offers trading platforms that are far more advanced than most crypto exchanges.

We go into more detail about AvaTrade in our full review here, this article will be looking at their Cryptocurrency CFD options.

Please Note: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

AvaTrade Gives Crypto Traders Great Tools

The crypto markets have grown up quickly. Crypto exchanges seldom offer the same level of trading tools that existing brokers like AvaTrade supply to every client. Having the right tools can make it much easier to trade effectively.

AvaTrade is also connected directly to the banking system. It is a perfect fit for traders who want to gain exposure to the wild volatility in the crypto markets, but don’t want to deal with owning cryptos.

Cryptocurrencies

Getting money in and out of AvaTrade is extremely simple, and the broker accepts a range of deposit options. If you are looking for a straightforward way to trade cryptos, and you don’t need to own them directly, AvaTrade is a compelling option.

Crypto/Fiat Trading Pairs

AvaTrade uses fiat currency to make crypto pairs, instead of crypto/crypto trading. For the moment all the crypto pairs that AvaTrade offers are paired with the US dollar.

AvaTrade supports trading in the following cryptocurrencies:

  • Bitcoin
  • Bitcoin Gold
  • Bitcoin Cash
  • Ethereum
  • Ripple
  • Litecoin

Traders can use 2:1 leverage if they are in the EU due to ESMA regulations. Position sizes are capped at $600,000 for BTC pairs, $200,000 for BCH and LTC, $50,000 for BTGUSD, $400,000 for ETH, and $250,000 for XRP.

AvaTrade is working to stay competitive in the crypto trading market, so keep an eye out for any updates to its crypto trading policies on its website.

Advanced Order Types

One area where AvaTrade distinguishes itself is its trading platform. Like most CFD brokers, AvaTrade uses the MT4 trading platform. MT4 is a robust trading platform that allows its users to take advantage of order types, bots, and plug-ins that can’t be matched on crypto exchanges.

To begin with, MT4 allows for stop loss and take profit orders, both of which are kinds of limit orders. Using limit orders on crypto exchanges isn’t easy, and generally involves the use of a third-party platform. Limit orders make it much easier to trade successfully, but MT4 is capable of a lot more.

MT4 has been an industry standard trading platform for more than a decade. There are literally thousands of tools that have been created for it, and many of them are totally free. Crypto exchanges simply can’t match this level of trading sophistication, which is a big advantage for anyone who trades on MT4.

Account Protection

As a regulated broker, AvaTrade is able to offer deposit protection for many of its customers. Anyone who has an account with AvaTrade has account protection up to 20,000 euros via Ireland’s Investor Compensation Company (ICCL), which is something that no crypto exchange can offer.

In addition to the protection offered to AvaTrade clients by the ICCL, the level of transparency that is required from the company is much higher than what exists in many crypto exchanges. The simple fact is that there are few regulations that govern how crypto exchanges operate, which can lead to situations like Mt. Gox.

For traders that put the safety of their capital first, trading crypto with AvaTrade may make more sense than trusting a mostly unregulated crypto exchange. Regulations aren’t perfect, but they do promote responsible corporate behavior.

How Do I Trade Cryptos With AvaTrade?

Trading crypto with AvaTrade is like trading any other product the brokerage offers to its clients. All you have to do is open an account, deposit the minimum amount that is required for your region, and download MT4.

Open an Account at AvaTrade

The account opening process at AvaTrade can be done online, and shouldn’t take more than a day or two to be operational. All you have to do is fill out the online application form, and submit any documents that the company asks for.

Once you supply all your information, you will have to fund your account. You can choose between USD and EUR as your account’s base currency unless you live in the UK or Australia. UK residents can choose between USD, EUR, and GBP, and Australian residents can choose from AUD, USD and EUR.

Open an Account

It is a good idea to choose the base currency that you use for banking, as there may be additional fees to convert currency. Once you choose a base currency for your account it can’t be changed, but you will be able to start another account in a different currency if you like.

Deposit/Withdraw Funds

The deposit and withdrawal methods that AvaTrade accepts vary based on where you are a resident. Anyone can make a bank transfer to fund an account, and some areas will be able to use e-payment providers or credit and debit cards.

AVATrade Deposits

Are CFDs Right for You?

CFDs are a good way to gain exposure to financial assets over a short to medium term. The real question for crypto traders is one of ownership and individual goals.

If crypto ownership is part of your plan, CFDs aren’t the right way to go.

AvaTrade is connected to the fiat currency system, and all trades will be settled in fiat currency. Hardcore crypto enthusiasts may not see CFDs as a good way to gain exposure to crypto, they are perfect for traders to enter and exit crypto position quickly.

One of the biggest advantages that AvaTrade has is that its crypto offerings fall into a much wider mix of derivative products.

Traders that want to have access to numerous markets are well served by CFD brokers. Crypto exchanges will accept cryptos, but moving those cryptos to a broker that deals with FOREX and other products takes a lot of time, and isn’t cheap.

Trading crypto with AvaTrade makes moving from the crypto market into other assets a seamless experience, and it offers a lot of tools for multi-market traders.

AvaTrade Offers a Lot to Traders

AvaTrade is a good choice for traders that want to trade cryptos, but don’t want to deal with cryptos directly. Trading in and out of the crypto market is a hassle if you also want to trade in established financial markets, and AvaTrade resolves this problem.

In addition to ease of trading, AvaTrade also gives its clients access to educational tools and the industry standard MT4 trading platform. There are also options for traders that want to trade from a mobile device, and still use all the features that MT4 has built-in.

If you want to learn more about AvaTrade and its crypto trading products, please click here. There are lots of other CFD products to choose from as well, like FOREX trading, stock indices, and commodity CFDs.

Please Note: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

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