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Coinbase Instant Buy Program May Be Fueling Bitcoin’s Meteoric Rise

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As bitcoin’s market value surges past $92 billion, a key announcement by cryptocurrency exchange Coinbase could be a driving factor behind the dramatic rally.

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Coinbase Announces Instant Buy Program

Coinbase, the world’s most funded digital currency exchange, announced Thursday it is enabling U.S. investors to make instant purchases of up to $25,000 worth of bitcoin, Ethereum and Litecoin. Previously, users had to wait several days to receive their coins.

“Reducing the time to receive digital currency has been a highly requested feature and we are pleased to provide this improved experience for our customers,” David Farmer, the director of Coinbase Communications, said in a Thursday blog.

The decision to go instant was also announced by Coinbase co-founder and CEO Brian Armstrong via Twitter.

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The San Francisco-based Coinbase was founded in 2012, and has more than 11 million users. It is widely considered to be one of the most accessible trading platforms enabling widespread access to the digital currency market.

Bitcoin prices peaked above $5,800 Friday, with prices fluctuating significantly before the Coinbase rollout.

IMF’s Lagarde Comments on Cryptocurrency Revolution

The International Monetary Fund’s Christine Lagarde is closely monitoring the bitcoin market, and says the global lending institution should play a role in regulating the fin-tech industry going forward. The Managing Director of the Washington-based organization said financial institutions must carefully evaluate and understand the digital currency sphere without jumping to conclusions.

“I think we should be aware of not categorizing anything that has to do with digital currencies in those speculation, ponzi-like schemes,” she said, in reference to Jamie Dimon‘s assertion that cryptocurrency is equivalent to “fraud.”

“It’s a lot more than that as well,” she added.

Lagarde said that it was possible for the IMF to develop its own cryptocurrency at some point in the future. The protocol may operate in a similar fashion to the IMF’s Special Drawing Right (SDR), an international reserve asset.

Featured image courtesy of Shutterstock

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Forex and CFD Broker Recommendation: eToro

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Pros

  • Good coverage of currencies, stocks, indices, commodities, and other asset classes with low fees in the retail segment
  • Industry-leading social trading offering, CopyTrading, CopyFunds
  • Easy to use, advanced trading platforms
  • Exposure to Bitcoin, Ethereum, Ripple, Litecoin, Ethereum Classic, and Dash through CFDs
  • Stable, fully regulated company with millions of users and a strong financial position
  • Only $100/$200 minimum deposit
  • Premium account above $20,000

Cons

  • Margin rates high for long-term positions
  • Minimum 2-pip spreads
  • Stock exposure only through CFDs
  • Steep withdrawal fees
  • No US clients accepted

Recommendation:

eToro has come a long way since 2007 to become a leader in the social- and copy-trading segment, while accumulating a user base of 5 million, and establishing the reputation of a stable and trustworthy broker. The company navigated through a challenging decade and kept on innovating and expanding its reach throughout the way, and now it offers one of the strongest selections in the major asset classes among retail brokers while also offering exposure to the major cryptocurrencies.

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We recommend eToro for all beginner traders, especially those looking for the opportunity to learn from established traders and invest together with them while building their own strategies as well. Those looking for the lowest fees, margin rates, and spreads could find slightly better options, like our other pick Interactive Brokers.

Availability

One of the biggest drawbacks of the company is the lack of support for US residents, but to be fair, the whole retail broker industry has issues with the strict regulation of country. Other than that, the company accepts clients from all over the world, through it’s UK and Cyprus regulated branches, and opening and funding an account is easy and swift.

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Funding options are plentiful, with support for the major e-wallets, credit and debit cards, as well as wire transfers.

Trading Platforms

The eToro trading platform is easy to use, and social trading is deeply integrated, with support up to 100 traders to copy. Trading is easy in all asset classes, with the help of an advanced search function and with no slippage whatsoever, although spreads are a bit wider than with some other brokers.

A fully functional mobile trading platform is available for iPhone and Android, with good charting capabilities and a reasonably quick operation.

CopyFunds Platform

The new CopyFunds option is also available now giving a comfortable and cheap alternative to managed funds. As the company website explains:

You can invest in two types of CopyFunds: Top Trader CopyFunds which comprise the best performing and most sustainable traders on eToro, and Market CopyFunds that bundle together CFD stocks, commodities or ETFs under one chosen market strategy.

CopyFunds™ aim to help investors minimise long-term risk, promote opportunities for growth, by taking copy trading to the next level and creating diversified investments.”

Other Tools

There is a wealth of valuable information the form of webinars, e-courses, and other educational materials readily available besides the millions of active traders. The Popular Investor program is great for experienced traders who can leverage they knowledge and earn a significant amount of extra income with very little effort—other than implementing their regular strategies.

Responsible Trading

Responsible trading settings are very useful, like pre-set leverage settings (with a 1:50 default maximum), and the 20% maximum exposure/trade limit are great to manage risk and let you control your emotions in volatile markets. We strongly urge traders not to use the maximum leverage allowance (not even close) with regular strategies, especially at the first period of one’s trading career. The practice account is also a great way to get ready for ‘real” trading to get to know the order types and the effects of leverage to your portfolio, and also the peculiarities of each asset

Final Words

Some of the general problems with retail brokers aside like dangerously high leverage options, user interfaces geared towards overtrading, and notoriously high fees, eToro is among the best options for beginners to get their feet wet in trading and start. With the responsible trading initiative and the social trading functions, most of the worries can be addressed, while the fees are not sky high, although they are above than in the case some of the discount brokers out there.

Featured image from Shutterstock. This post is not sponsored.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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Global Stock and Cross-Asset-Class Broker Recommendation: Interactive Brokers

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Pros

  • Great global asset coverage and availability (100+ markets)
  • Very low fees and margin rates
  • No proprietary trading, no risk of default
  • Good mobile offering and versatile trading platforms
  • API integration, automated trading options,

Cons

  • $10,000 minimum capital ($5000 for US IRA accounts)
  • User Interface not the easiest
  • Customer support issues
  • No social or copy trading
  • Relatively low leverage allowance
  • Large one-time orders are cheaper elsewhere

Tradable Assets

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There is no broker matching the offering of IB, with stocks (24 countries), bonds, indices, forex, options, futures, mutual funds, warrants, turbos and everything else in the traditional asset classes being available. In one platform with a searchable quote list, you can access all products very quickly. Also, ever since (10+ years) I have been following the company, they have been constantalbeitbeit slowly) adding new markets and products.

Recommendation

We recommend Interactive Brokers for all active, cross asset class traders who are willing to spend the time to set up the trading platform and customize the User Interface. The service is available in most countries of the world, with access to a wealth of asset classes and a wide range of countries. Prices in every dimension are very low, although they do charge a $10 “inactivity fee”. That might seem steep, but if you hold any margin positions, the very low margin rates will make IB the cheapest choice in no time for investors with large value positions as well.  Compared to retail forex (IB offers ICN forex trading) and some full-service stock brokers trading fees are simply stunning. This means that with retail brokers you might be paying several times more for margin positions than with IB, but other discount brokers are also trailing the company.

Beginners and investors with a lower budget should look elsewhere, although we have to note that having a UI that is not optimized to “urge” trading is not a definite disadvantage. Sadly it is true that with brokers as well that if you are not wealthy you cannot afford a bad product or service.Customer support could be erratic, but your money is safe with IB and usually, all issues are solved; just you need to push them a little bit.

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Availability

IB accepts clients from practically every country in the world, and although applying for an account is not as easy as with some other brokers, active traders will make the hassle up very quickly with the low fees. Want to invest in less known markets and assets? You have it all here, with full access to all major global marketplaces.

Trading Platforms

The Trader WorkStation (TWS) is the main desktop platform of the broker, with great versatility, lots of order types quick access to all markets and asset classes, but with a relatively high level of resource need, and a steep learning curve and way too many options for the beginner trader.

Mobile trading is great and reliable on all platforms, although charting is not perfect and some functions are dearly missed from the desktop version. There is also the fully functional WebTrader for the occasional on-the-road trade. Through its great API you are able to connect all kinds of trading and charting software, algorithmic systems, or other third-party applications. Two-factor authentication is available on all platforms, and safety functions are generally at a high level across the applications.

There is also a very helpful and perfectly functional Simulated Trading account, where you can get to know the user interface the different order types (with even simulated deep order book trading) and practice your strategies without limitations.

Other Tools

Analysis tools are great, with only some special ed (TradeStation, Optionshouse) brokers beating the company in some

Where IB is lacking, is the in-house research tools and the access to mutual funds and other investment options. Don’t get us wrong, those are all there, but other (non-discount) brokers make it a lot easier to access information and invest in third-party funds. Again, if you have your information sources or you are willing to pay up for an outside provider- which a serious investor would do eventually- these are non-issues. That said, it is fair to say that the system is not geared towards beginners.

Final Words

With all the limitations and issues in mind, Interactive Brokers is not for everyone, but above an intermediate level, and for a global approach it’s hard to find a better choice. With over 40 years of history, the company is here to stay, and as it doesn’t conduct trading on its own account, your funds are secure, and “blowing up” is not a realistic risk for the firm.

What’s your experience with the company? Did you have any issues with the service or did we miss something vital? Let us know in the comment section. We will focus on forex-brokers int he next part of our review series.

Featured images form Shutterstock and company website.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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