Retail FX and CFD broker Admiral Markets announced the addition of four cryptocurrencies for trading on its platform: Bitcoin, Ethereum, Litecoin, and Ripple.
As cryptocurrencies keep trending and prices of Bitcoin and Ethereum soar, retail foreign exchange brokers no longer can ignore the hype and the opportunity for traders.
To the crypto train, Admiral Markets joins other brokers such as XTB and Alpari, as well as Plus500, IG, eToro, AvaTrade, ayondo, and Markets.com. Admiral’s offering puts the currencies against the US dollar:
- BTCUSD – Bitcoin vs US Dollar
- ETHUSD – Ether vs US Dollar
- LTCUSD – Litecoin vs US Dollar
- XRPUSD – Ripple vs US Dollar.
Cryptocurrencies trading is available 24/7, which should attract weekend traders. There are, however, higher risks to trade such pairs in a leveraged environment due to the atypical volatility found in cryptocurrencies’ price movements. To protect traders, Admiral Markets is setting up limits to leverage of 1:5 for BTC/USD and ETH/USD and only 1:2 for LTC/USD and XRP/USD.
In addition, the broker will impose the following rules during the initial stages:
- You can only take long positions only (i.e. open and close ‘Buy’ positions only). Short selling will not be allowed as all your transactions are backed by Admiral Markets on the exchange.
- Your net exposure on any or all cryptocurrency instruments will not exceed 10,000 EUR or the equivalent.
These rules allow Admiral Markets to build reserves at the exchange, but as cryptocurrency trading volumes increase and more brokers allow such instruments, restrictions should reduce in the long run.
On the announcement, Admiral Markets admits to seeing the offering as a pilot phase: “Nowadays, cryptocurrencies are among the most talked-about topics, around the world. As Admiral Markets is constantly striving to be at the forefront of the industry, we’re delighted to add the “most wanted” Bitcoin, Ethereum, Ripple and Litecoin to our trading offer. We hope this will grant our clients new and exciting trading opportunities”, says Jens Chrzanowski, member of the Admiral Markets Group AS Management Board. “At the moment, our offer is a ‘soft’ start, a pilot phase, after which, conditions will be improved and finalised”, he continues.
Not only are Forex brokers following the cryptocurrencies trend more and more, but financial watchdogs have been increasingly active in regulating its business. This week, the US Commodities Futures Trading Commission (CFTC) approved a Swap Execution Facilities (SEF) registration of a US Bitcoin Options Exchange for the first time. Institutional trading and clearing platform LedgerX is the first federally regulated bitcoin options exchange in the US.