Why Forex Traders Are Turning to Crypto

September 30, 2021 | 

Why Forex Traders Are Turning to Crypto

The number of forex traders shifting over to the cryptocurrency market has been on the rise for the past four years. In this article, we look into the motivational factors that are bringing forex traders into the cryptocurrency markets and how you can get free access to MetaTrader 5’s performance-based trading platform.

Price Volatility

The cryptocurrency market is best known for its heightened levels of price volatility. Meaning that digital asset prices can move aggressively in a short period of time. It’s not uncommon for assets like Bitcoin to make a 20% move in a day, or even a few hours. This level of volatility is unmatched in the foreign currency markets, which are even less volatile than stocks. The absence of volatility in the forex market results in traders taking on highly leveraged positions in order to make their time and effort worthwhile.

By opening highly leveraged positions, forex traders are taking on significant risks that can result in a 100% loss. The volatility in the cryptocurrency markets is advantageous for skilled forex traders as they can capture larger profits without taking on the additional risks of overleveraging.

Market Maturity and Arbitrage Opportunities

The maturity of the cryptocurrency market is a primary factor leading forex traders to speculate in the digital asset markets. Interestingly, this stems from both the perceived maturity and immaturity of the cryptocurrency markets. For forex traders, there are aspects of both crypto’s maturity and immaturity that are appealing.

Take Bitcoin for example, the world’s first-ever digital asset is barely a decade old. Compared to the modern forex markets which launched in the 1970’s. In the grand scheme, that hasn’t proven to be enough time for the cryptocurrency markets to fully mature and shed its price inefficiencies. Going further, in 2021, five of the top ten cryptocurrencies by market capitalization are less than 5 years old.

From one angle, the digital asset markets are still immature and contain pricing inefficiencies that present quick-witted traders with an abundance of arbitrage opportunities. Forex traders, often looking for arbitrage trades, begin to take an interest in cryptocurrency as they learn how to capitalize on the price difference that exists across various geographic locations.

On the other hand, some forex traders are finally dipping their toes into cryptocurrency for the opposite reasons. Anyone that has been involved in digital currency for the past five years can attest to the staggering innovations that have emerged. Many forex traders, discouraged by the lack of safe and useful trading platforms in the past, now feel comfortable trading on the greatly-improved platforms that are available in 2021.

Specific to cryptocurrency exchanges, recent years have seen major upgrades in UI/UX and overall usability. We have also seen drastic improvements in exchange security along with a sharp drop in average trading fees. All of these factors are beneficial to forex traders and have given many the confidence to make their first deposit with a cryptocurrency exchange.

Timing is Everything

When it comes to being a consistently profitable trader, timing is paramount. Having the ability to transfer and trade funds as fast as possible is vital to a trader’s success.

Forex traders have been plagued by missed opportunities stemming from the fact that it takes multiple days for fiat currency deposits and withdrawals to settle. Cryptocurrency transactions are notably fast with most settling from just a few minutes to a couple of seconds. Having that level of flexibility, in terms of moving your funds around, allows traders to take advantage of more profitable opportunities relative to the forex market. This presents another factor pulling traditional currency traders into the digital asset markets.

In addition to missed opportunities while fiat funds are in transit, hungry forex traders that are not interested in taking a day off are trading cryptocurrencies on the weekend. While the forex markets are open all day during the week, the markets are shut down on the weekends. Leaving many traders searching for profitable opportunities on a Saturday or Sunday. Forex traders are finding these opportunities in the cryptocurrency markets that are open 24/7.

MetaTrader 5 on Beaxy: Where Forex Meets Crypto

Why Forex Traders Are Turning to Crypto

In response to an influx of forex traders into the cryptocurrency markets, Beaxy Exchange integrated MetaTrader 5, the leading FX trading platform. This integration gives every Beaxy account holder free and unlimited access to everything that MT5 has to offer. Additionally, using MT5 through Beaxy gives forex traders the opportunity to seamlessly trade both crypto and FX products on one platform.

MetaTrader 5 is a feature-packed trading platform that is highly customizable. The software is free for Beaxy users and has a proprietary coding language (MQL5) that enables the development, backtesting, and optimization of custom trading algorithms. For those with less programming experience, MT5 provides a marketplace where you can buy access to existing algorithms that are developed by Expert Advisors with backtested results and user reviews.

Getting Started With MetaTrader 5 on Beaxy

Check out Beaxy’s video instruction guide to get started with MetaTrader 5. Massive trading fee discounts are coming soon for those trading on MT5 through their Beaxy Exchange account.

Click below to sign up today and get updates on fee discounts, newly listed assets, promotions, and more.

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