Difference Between Forex and Crypto Trading

  • In the world of digital trading today it is no secret, if there is a type of trade, it is crypto trading and forex.

    Both require certain intelligence to navigate unpredictable market conditions so that traders get profits.

    Of the two types of trade currently prevalent in the internet world, what is the difference between forex and crypto trading, we will discuss it in this article

    In his notes, Alex Mashinsky, CEO of Celsius Network, explained that crypto and foreign exchange both represent digital values and traders can sell or buy easily. Both crypto trading and forex have high volatility which creates opportunities to get short-term or long-term profits

    Bitcoin trader Crypto and forex traders are dominated by large financial institutions that have reliable trading algorithm capabilities, and retail players will be hard to match them

    Forex trading is currency trading from different countries. This Forex stands for Foreign ExchangeIn forex trading, for example, is buying Euros, while simultaneously selling USD, which in forex in the pair can be abbreviated as EUR / USD.

    Bitcoin is an open source virtual currency (cryptocurrency) which was developed in 2009 by someone with a pseudonym Satoshi Nakamoto. This currency is like the Euro or Dollar but is only available in the digital world. This bitcoin is saved in the Bitcoin wallet. This wallet will be used to send and receive bitcoin, with varying fees or shipping costs.

    New bitcoins are created with a process called "mining". Miners use sophisticated computers to decipher complex mathematics to find new Bitcoin blocks, as a reward the inventor will be rewarded with a number of bitcoins.

    Prizes per 1 block found were initially 50 BTC, now 25 BTC / block. The number of Bitcoin has been determined since it was created, which is as many as 21 million BTC. This limitation is carried out to prevent inflation.

    The biggest difference between the forex market and BTC is that bitcoin is started and enhanced through global retail trade and not through institutional players while forex in it is dominated by institutional players and also central banks

    The BTC market behaves differently from the forex market, where players in this type of trade are global networks originating from various traders

    Forex requires skill and luck

    Fiat's currency in forex has the potential to be unlimited because each currency supply is determined by the country's monetary policy.

    Each state central bank usually regulates the supply of its country's currency to always be available through various policy mechanisms by setting interest rates and other policies that support the country's economy.

    This policy decision was made with a specific purpose towards domestic and global macroeconomic conditions and imperatives, and thus resulted in fluctuations in both supply and demand

    Currency traders will try to need skills to look for opportunities by looking at the macroeconomic conditions of the country concerned with the aim of earning profits from the trade but also speculative

    BTC offers a small fee

    BTC is traded on a peer to peer basis, thus transactions in crypto trading involve a small fee.

    This is because in crypto trading there is no intermediary in the classical sense, as is the case in the foreign exchange market where brokers facilitate transactions between participants, which often add to costs

    The Forex Market Has A High Liquidity Level

    There is no doubt that the forex market has high liquidity

    Progress in the field of technology encourages activities in foreign currency trading, as a result of increasing cross-border transactions and the availability of extensive trade facilities and infrastructure, making it easier for currency traders to gain access to forex trading.

    The forex market is the biggest market compared to the crypto market, wherein the daily market there is a volume of transactions in millions of dollars

    But on the other hand, there are some similarities here with bitcoin, which and most of the trading volume can be attributed because the crypto market is open 24 hours 7 days a week which means the crypto market is never off and this can increase the volume of demand and supply

    Only a small number of traders can make a profit

    A more volatile forex market, either for bearish or bullish, gives more opportunities to gain profit in trading

    But Crypto traders face a difficult year in 2018, even though these digital assets have gone through the highest prices in 2017, but afterward, it's hard to get out of bearish pressure

    And it is very difficult for short-term traders to get consistent profits.

    Advantages of Forex Trading

    Forex trading offers many advantages for traders that are not even obtained when traders trade BTC. Some of these benefits are;

    • Liquidity: The amount of forex space ensures considerable market depth with a variety of currencies that are popular in the world.

    • Diversity: Major, minor and exotic pairs are available for active trading.

    • Stability: In addition to extraordinary circumstances, foreign exchange rates are relatively stable. Large fluctuations are rare due to the amount of volume traded.

    • Leverage: Extensive leverage available in forex. Brokers usually offer 50: 1, 100: 1 and even 200: 1 or 1000:  1 for clients

    Advantages of Bitcoin Trading

    In terms of liquidity and market depth, Bitcoin trading may be said to be not comparable with forex.

    However, BTC can provide quite a lot of benefits for traders who are actively trading BTC. Some of them are;

    • Volatility: the limited number of BTC chips creates ideal conditions for substantial daily trading and volatility spikes. The value of fluctuations greater than 5% is common.

    • Ease of entry/exit: All that is needed to enter the BTC market is online capital and cryptocurrency brokers or direct market access.

    • Minimal cost: Minimal transaction costs can even be zero. If using a broker, fees can be assessed at the time of purchase or sale of BTC. If you directly access the market, the costs can be very minimal.

    • Isolation: BTC does not face fluctuations caused by conventional currency issues. Geopolitical interests or the performance of the domestic economy do not determine value.


    In many ways, the comparison of trading in BTC with forex is like an analogy of apples and oranges. It is true that both involve electronic trading of various currencies.

    However, the size, structure, and behavior of each place are very different. Thus, they cannot be equated or even equated despite having some similarities.

    Of course, opportunity knows no boundaries. Many active forex traders have forgotten the relative security in the forex market and turned to markets that are considered more potential, namely BTC and other cryptocurrencies. However, the decision of whether to trade forex or BTC depends on individual goals, risk tolerance, and resources.

    Hopefully, the different articles on BTC and Forex trading above can give you some information about both. However, both are different and offer different benefits.

    So that each trader will usually do some analysis or research on both of them before choosing which one to trade.