Cryptocurrency CFD Broker Overview: Tips To Choose One

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Crypto is one of the favorite instruments for trading on crypto price movements. Before the inception of blockchain, digital currency was traded through specific crypto exchanges or over-the-counter markets where buyers and sellers could purchase and sell coins directly between themselves. But as time progressed, crypto was no longer a niche limited to a smaller group of tech geeks and found its way to become a widely popular speculative asset with much more trading tools and options. This is where CFD (contracts for difference) came in handy.

Benefits of Cryptocurrency CFD Trading

  • With CFD trading, there is no need to actually own the asset.
  • Best-suited for intra traders who want to make profits on short-term crypto price movements.
  • CFD brokers offer excellent risk management and technical tools which makes crypto trading easier for non-tech savvy traders.
  • Majority of CFD brokers are regulated; hence there are fewer chances of frauds and thefts.

How To Choose A Broker For CryptoCurrency CFD Trading?

The CFD trading options are gaining immense popularity among market participants. This is why so many brokers are popping up every day to provide traders with CFD trading opportunities and satisfy their growing demands. However, when you choose a crypto broker for CFD trading, you need to know what CFD trading is. Typically, CFD trading is a contractual relationship between the brokerage and its clients. In CFD trading, you make a profit or loss depending upon the prices at the beginning and the end of the trade. Thus, ensure that the broker you choose for CFD trading utilizes accurate trading data and does not manipulate prices in any manner. Otherwise, you won’t be able to take advantage of crypto price movements irrespective of how efficient and precise your speculations are. It’s a complicated problem because there is no official source for crypto quotes currently; thereby, prices can vary significantly at different crypto exchanges.

Cryptocurrency CFD Broker

Checklist For Choosing A Cryptocurrency CFD Broker?

Here are the factors you must consider if you are thinking of dealing with a cryptocurrency CFD broker for your trading needs.

  • Regulation: As a trader, you must ensure that the broker in question is licensed and regulated crypto platform by a reputable regulator who will act as a watchdog. Some of the respectable regulatory bodies that supervise crypto CFD brokers are NFA, CySec, FCA and more. These regulators will protect you against any fraudulent activities of the brokers.
  • Trading Conditions: Another important consideration when selecting a broker for crypto CFD trading is to check their spreads, overnight fees (if any) or any other conditions written in small letters at the end of the service agreement. It’s vital to know all the trading expenses in advance so that you know how much you are going to pay for brokers’ services. Ultimately, whatever you pay to the broker will affect your profits.
  • Leverage: Often, traders fall victim to high-leverage benefits, which should not be the case. Ensure that you have understood the risks and can afford to lose the invested capital in case the market moves against you. Always bear in mind that crypto is the most volatile asset you will ever come across, and hence use leverage wisely.
  • Do Your Homework First: Before you choose to deal with any CFD broker, make sure that you have researched the broker in detail. Before you open a trading account with them, you must check for any scam alerts, withdrawal issues and other problems you might face when dealing with the broker. Also, the internet is filled with both fake and genuine reviews, so ensure that you have separated them both in order to make the right decision.


CFD trading is an effective option for traders who wish to gain quick and straightforward crypto market exposure. Although there are various advantages of crypto CFD trading over crypto exchange trading, the range of trading instruments typically depends upon the investment objectives as well as the individual trading style, meaning the traders should analyze all pros and cons before going with it. Nevertheless, the best aspect of CFD trading is that it offers traders an easy way to engage in crypto trading without actually owning the asset.