A cryptocurrency is a type of digital money created from code. They function autonomously, outside of traditional banking and government systems.
Cryptocurrency trading is the process of speculating on a digital currency's price movements. Instead of buying and selling directly via a crypto exchange, you can get exposure to cryptocurrency price movements without owning the asset, through a CFD trading account.
As opposed to when you buy crypto directly, when you speculate on its price via CFD trading, you can go long or short, based on your view of the market.
We aim to provide a diverse, balanced view of the cryptocurrency market's performance with our three crypto indices, which enable you to take a broader view of the crypto market.
For our Major Crypto Index, we've established a cap so no single cryptocurrency can constitute a weighting of greater than 40% of the index. While no individual constituent makes up more than 40% of the Emerging Crypto Index, we may establish a cap of 40% for this index should it become necessary at a future date. The All Crypto Index gives 60% of the total weighting to major cryptos and 40% to emerging coins. Each cryptocurrency is then weighted equally within that banding. The weightings of any uncapped component that then fall below a 5% floor will be increased to that value, taking proportional market capitalisation from any uncapped index component.
We monitor our crypto indices periodically to see whether any adjustments need to be made to constituent weightings. We also monitor closely for any hard or soft forks, which may necessitate adjustments to the constituent cryptocurrencies. If such adjustments are made, we will change the index divisor to ensure that there is no resulting impact on the index prices.
There are a number of costs to consider when trading CFDs on cryptocurrencies, including spread costs, holding costs (for trades held overnight - this is essentially a fee for the funds we 'lend you' to cover the leveraged portion of the trade) and guaranteed stop-loss order charges (if you use this risk-management tool).
You can trade on cryptocurrencies with us 24 hours a day, from Monday to Thursday. On Friday, we close at 9pm (UK time).
You don't need a custody account to trade on cryptocurrencies with us. This is because, when you trade CFDs, you don't take ownership of the underlying asset. Instead, you're trading on the rising or falling price of a cryptocurrency.
To close or reduce a position, select the red "Close Trade" X to open an order ticket. To close all positions, select "X" in the overall row; to close a single trade, select "X" in the individual position row.
To partially close a position, you must reduce the "size" of the trade. The wording at the bottom of the ticket will change to indicate that you're reducing your position instead of closing it.
Blockchain forks are essentially a split in the blockchain network. The network is open source software and the code is freely available. This means that anyone can propose improvements and change the code. The ability to experiment with open source software is a fundamental part of cryptocurrencies and also facilitates software updates to the blockchain.
Forks occur when the software of different miners is misaligned. It's up to the miners to decide which blockchain to continue using. If there is no unanimous decision, this can lead to the creation of two blockchain versions. Increased price volatility can occur around such events.
Our cryptocurrency prices are based on the underlying market, and provided to us by the exchanges and market makers we trade with.
When there is a hard fork, we generally follow the blockchain that has the majority consensus of the users of a cryptocurrency, and we'll use this as the basis for our prices. We reserve the right to determine which cryptocurrency unit has the majority consensus.
We'll endeavour to inform our customers of potential blockchain forks. However, it's your responsibility to ensure that you're aware of when these may occur.