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Bitcoin certificates are high-risk financial instruments that allow you to earn a lot of money speculating on the bitcoin market. Bitcoin certificates are incredibly high-risk instruments to trade with due to their often high leverage and due to the extreme volatility of the bitcoin market. Combining high volatility and high leverage can be a recipe for disaster if the market moves against you. It can be a way to make huge profits if the market moves the way you want it to move.
Where to trade bitcoin certificates?
Several brokers allow you to trade bitcoin certificates. My preferred broker for this trade is IQ option. They offer a x100 leveraged bitcoin certificate. A x100 leveraged bitcoin certificate allows you to make a 100% profit from a 1% increase in the price of bitcoin. A 1% fall can completely wipe out your investment.
Other good brokers who give you the chances to trade with leveraged CFD certificates include AVA trade, Markets.com and IC markets.
Understanding the risk
It is essential that you understand the risk you assume when you are trading with these certificates. You can quickly accumulate substantial loses and your loses are in many cases theoretically unlimited. You risk losing more money then you have invested. More money than you have in your account. A losing trade can place you in debt to the broker. You are legally responsible to pay this debt.
It is very important that you take steps to minimize the risk you expose yourself to when you trade with bitcoin certificates. It is also very important that you make sure to never leave your position unsupervised. Doing so can cause you to accumulate large losses while the position is unsupervised.
Many brokers will margin close your position if the funds in your account are insufficient to cover your losses. This will protect you from large losses. You can never rely on brokers to close your position to limit your loses to the money you have in your account. Many brokers do close losing positions before your losses exceed the money you got in your account but there is no guarantee that they will do that. The broker might fail to do so due to technical reasons or they might choose to not do so. The broker has no legal responsibility to close your position to make sure you do not lose more money then you got in your account.
If you live in the European Uunion then there is regulation protecting retail investors. This regulation ensures that you can not lose more than what you have deposited to your account. To be protected by this regulation you need to live within the European Union and use a broker that is regulated within the area.
You do not own the bitcoin
If you invest in a Bitcoin certificate you do not own any bitcoin. You are buying a financial instrument based on bitcoin. You can not use your Bitcoin certificates to buy anything. If you want to own bitcoin and be able to to use them to buy things then you have to invest in bitcoin directly.
Investing in cryptocurrencies
I recommend that you read my guide about investing in cryptocurrencies before you invest in bitcoin backed securities. Read the article here.
Gambling with bitcoin
Some casinos and other gambling sites allow you to open an account and gamble using bitcoin and other cryptocurrencies. An important benefit of using a bitcoin casino is that it is anonymous. No one except you and the casino will know that you gamble. There are no bank records that connects you to the casino account. This can be good if you want to keep your gambling secret.
Most casinos will convert the bitcoin you deposit into a fiat currency such as USD that you use while gambling. You will not gamble using bitcoin. You can then choose to withdraw your money as bitcoin. If you do then the money will be converted back into bitcoin and deposited into your bitcoin wallet.
Examples of casinos that accept bitcoin include Slotland, Red stagcasino, and Kudos casino.