High profile investors used to save anonymous trading for special occasions. But now that cryptocurrencies are more widely used in forex trading, anyone can trade stealthily. Using anonymity when trading has both advantages and disadvantages. Use bitcoin or any other altcoins your broker accepts if you want to trade forex anonymously. Documents entitled “Know Your Customer” are based on an anti-money laundering strategy implemented in 2014. Efforts were aimed at combating money laundering, particularly that committed by those who wish to support international terrorism. It’s obvious that KYC rules have a particularly good reason why we can’t exactly call them “bad”.
Know Your Customer (KYC) paperwork has been a problem for traders and no-KYC forex brokers since the beginning of forex trading. These documents are often the only thing standing in the way of a potential trader and the platform they need to start making money trading forex. This article explains what it means to trade discreetly, the benefits of doing so, and most importantly, the best way to use Bitcoin for this purpose.
Forex trading: KYC-based vs. anonymous
Forex investing, unlike cryptocurrency trading, is a highly regulated industry. Regulators require forex brokers to conduct thorough know-your-customer (KYC) procedures before allowing traders access for this reason. Traditionally, anonymity was not a feature of exchanges. But over time, many people have switched to hybrid or anonymous trading methods. So what exactly is anonymous trading? Investors trading anonymously do so voluntarily; however, their trading activity is still recorded in the order book. An investor often has the option to trade on a national (anonymous) market or through the more exclusive dark pools.
As anonymous brokerages are still regulated, they do not offer perfect anonymity as authorities can still get details about a particular trader’s identity and activities. Dark pools, on the other hand, are exclusive trading venues that are not normally accessible to the wider investor community. Like traditional brokerage firms, they can legally register and transact business. Crypto is extremely helpful in maintaining the anonymity of transactions, whether trading on an open marketplace or in a dark pool. Now let’s find out why you might consider trading anonymously.
Why Do Some Forex Trade in the Dark?
Investors’ reasons for trading anonymously may vary slightly. But the following are typical explanations.
Identity Protection: You may choose to maintain your anonymity as an investor in exchange for personal gain. Sometimes you just want privacy, be it to bypass some borders, avoid stalkers, etc.
Keep your strategy safe: If you are a very skilled trader, your strategies may be copied over and over again. You will find it more difficult to understand your approach if you act while keeping your identity a secret.
Hide your intention: Due to the irrational nature of the cryptocurrency markets, prices can change, sometimes to your detriment when other users notice that you are buying or selling in significant quantities. Buying or selling covertly in such a situation allows speculation to control price movements.
Using Bitcoin for Anonymous Forex Trading
Trading cryptocurrencies on the forex market is very likely. And while you can trade forex using any cryptocurrency (if your broker allows it), there are some advantages to using Bitcoin. The most important is undoubtedly its widespread acceptance. Due to its volatility, BTC is a good currency to invest in. So this is how you can trade forex with bitcoin.
Get Bitcoin First: Of course, buying bitcoin is the first step. To do this, you need to go to an exchange (though not a forex exchange). Learn more about companies like Coinbase, Binance, and Changelly.
Find a reliable broker: Bitcoin is not accepted by every FX broker. Forex brokers that accept bitcoin deposits are the ones that do.
Deposit Bitcoin: Make a bitcoin deposit with the broker and tell them the details of the trade you want them to execute.
This is of course a general summary of the procedure. You need to be aware of certain nuances, such as: B. Rating brokers and the pros and cons of using Bitcoin for cryptocurrency trading. Here are a few to consider.
Advantages of Bitcoin Forex Trading
Extended Anonymity: You don’t have to reveal any of your personal financial information when trading forex with bitcoin.
Increased Leverage: Leverage offered by brokers has increased for bitcoin trading. This can be really beneficial if you know how to use leverage.
Potential lower expenses: To attract the new generation of BTC forex investors, bitcoin deposit forex firms are reportedly lowering their brokerage fees.
Lower eligible deposits: Once again, it appears that forex brokers accepting Bitcoin deposits are using this tactic to attract new investors.
Cross-border trade: Cross-border trade becomes easier as Bitcoin is global money that can be used by anyone, anywhere.
Disadvantages of bitcoin forex trading
Volatility: Since the price of bitcoin is constantly fluctuating, a broker can take advantage of traders by buying their bitcoin at the lowest price of the day and selling at the highest price of the day.
Use the temptation: The leverage used to attract BTC forex brokers poses a significant risk for beginners.
Combination of different asset classes: Bitcoin and FX are two different types of assets. The complexity and dangers of trading are increased by the use of an “intermediate currency”.
Risks of using Bitcoin: If not properly secured, bitcoins, like all cryptocurrencies, can be easily stolen. A trusted and regulated broker protects your money.
The benefits of using Bitcoin for anonymous trading are numerous. You can benefit from increased leverage, cheaper minimum deposits, lower fees, easier cross-border trading, and other factors. You can also try a growing number of forex brokers for bitcoin deposits. To avoid losing money, be careful, do thorough research on brokers, start slow and experiment with small deposits and small transactions. Overall, anonymous forex trading using bitcoin is a fascinating endeavor to pursue whether you are a seasoned gambler or brand new to the game.