We don’t talk about trading here, but we know many people are interested in the topic and the connection between buying coins and trading them is still here. Bi-currency investments might help you with making your risks less and are overall an interesting idea on the way you manage your investments.
Straight to practice
Let’s not try explaining the topic, using words, but show some use examples.
An investor places a 1 BTC deposit on the exchange waiting for the rate to increase all the way up to 30k USDT. The order is said to be executed with a 5% profit in 7 days or less.
If the deal is successful and Bitcoin raises its rate to 30k USDT, the Bitcoin is sold for 30k USDT + a 5% profit (1.5k USDT) and returned to the investor as 31.5k USDT. If the deal fails and Bitcoin remains at a rate lower than 30k, investor gets 1 BTC returned + 5% profit in Bitcoin, so 1,05 BTC overall. That way the risks are none and you get profit no matter if you succeed or not.
Most bi-currency investments have a higher profitability, when the term of locking in your currency goes higher. The conversion from one currency to another may also differ. Some exchanges might allow you to lock profit and convert the coins if the rates trespass the level you predicted only once with no need to hold that level until the deal ends and some might require the coin to keep that level for the whole term of the deal being active.
- The profits of such investments are relatively high.
- A big choice of pools that exchanges offer.
- The lack of taxes.
- A big variation of products with different risks.
- Short deposit term.
- Assets are locked with no ability to be returned until the deposit term ends.
- The rates of currencies might go lower than during the time the deal was opened and you might lose money because of that.
- The deal is usually executed depending on the rates, fixed on the day of opening it.
That should be it for today’s article and always remember that high profits are tied with high risks.