Crypto Explained

Crypto Spot Trading and Customized Leverage on the EQONEX Exchange

November 9, 2021


Crypto Spot Trading and Customized Leverage on the EQONEX Exchange
Spot trading with crypto refers to trading "on the spot," meaning that when you buy or sell crypto assets, the transactions are settled in real-time. Spot trade crypto on the EQONEX Exchange with customized leverage.

Most spot trading takes place on cryptocurrency exchanges, such as EQONEX, as these are the easiest and most convenient trading venues. You simply need to open an account, complete a simple KYC process, and send funds to purchase your chosen crypto asset.

How to trade with Customized Leverage on the EQONEX Exchange.

The crypto spot market 

There are more than 500 exchanges listed on data aggregator sites such as CoinGecko, but not all exchanges are made equally. Hence, it's important to carry out due diligence before deciding where to spot trade your crypto and ensure your chosen exchange is secure. 

Not all exchanges offer the same services, either. Some will offer more trading pairs, while others, like EQONEX, will focus on reputable coins that offer the best utilities to traders.

There are three essential components of every spot market: A buyer, a seller, and an order book. The buyer enters the market looking to purchase at a particular price. He or she is then matched with the seller willing to sell at the agreed-on price, and the order is executed and filled immediately. This action also happens in reverse when a seller enters the market and is matched with a buyer.

Types of spot trading

The most straightforward type of spot trading is to buy and hold (colloquially referred to as HODLing). This involves waiting for the asset to appreciate in value and then selling for a higher price than you bought. 

More active traders, especially those that use trading bots and algorithms, will often do this on a constant basis, buying and selling extremely frequently to take advantage of crypto arbitrage opportunities, where an asset is priced lower on one exchange and higher on another.

With most types of spot trading, you can only trade with assets that you own. However, it is also possible to take advantage of leverage and try margin trading with your assets. Margin trading allows you to make spot purchases that exceed the funds in your balance by effectively borrowing from the exchange to amplify your gains (and losses). 

For example, if you had $1,000 in your account and decided to use 5x leverage to margin trade, you could buy or sell $5,000 worth of crypto. 

Margin trading can be very profitable as it allows you to supercharge your trades and take advantage of market swings, executing more complex active trading strategies. However, it can also result in heavy losses if you make the wrong call, so margin trading is not recommended for novice traders.

Use customized leverage on the secure EQONEX Exchange

Unlike other exchanges, EQONEX allows Customized Leverage on an account level, meaning you can set different leverage for each of your accounts. Customized leverage allows you to set the leverage at any time on any of your Main or Sub Accounts, which reduces the risk of being liquidated. 

EQONEX is a Nasdaq-listed and regulatory compliant fully integrated spot and futures exchange that allows you to manage all your trades from one single account. Best practices, transparency, and investor protection are at the cornerstone of what we do, helping you feel more secure in your spot or futures crypto trading strategy.

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