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Bitcoin in Forex — Pay and Trade!

April 12, 2015 by

I have added a list of Bitcoin Forex brokers and also an introductory description of Bitcoin as a payment system to today. For now, there are only 17 companies in the list. There are two kinds of them:

  • FX brokers that accept Bitcoin payments or are ready to provide BTC withdrawals. In most cases, such companies use some third-party processing services (e.g. BitPay or Coinbase) to instantly convert all incoming payments into fiat. The balances are stored in traditional currencies and when they need to make an outgoing payment to the trader, they convert the necessary amount via the same processing service.
  • FX brokers that provide trading in cryptocurrency instruments. Usually, it is just BTC/USD, but some also offer LTC/USD (Litecoin vs. US dollar), PPC/USD (Peercoin vs. US dollar), NMC/USD (Namecoin vs. US dollar) and other cryptocurrency pairs. This opens up a lot of possibilities — from BTC/USD charting and analysis in MetaTrader 4 platform to trading some BTC/USD binary options or CFDs.

Currently, there are 11 brokers of the first kind and 7 brokers of the second kind in the list. The curious fact is that these two types do not overlap at all except for a single broker that offers both Bitcoin deposit/withdrawals and BTC trading — FXOpen. It is hard to explain rationally but most likely, the implementation of Bitcoin trading via spot Forex platform is a task that is too difficult for many small-time brokers that are eager to add one more deposit option to the list (which is relatively easy). At the same time, sophisticated brokers with cryptocurrency trading capability may be reluctant to start accepting Bitcoin as a payment option due to regulatory issues (KYC, anti-money laundering, etc.) According to my 2013 poll, the traders are divided in their opinion regarding the proper role of Bitcoin in Forex trading.

Anyway, both classes of brokers are worth checking if you are interested in Bitcoin and the related theory. If you are still lacking some of the basic understanding of the technology, you can watch this nice video explanation without too much technical matter in it:

And here is the video with some more technical details if you feel compelled to dive deeper into such ideas as decentralization, proof-of-work, and block chain:

If you have noticed that some broker is missing from the list — either of those using Bitcoin for deposit/withdrawal or of those offering trading in cryptocurrency pairs — please feel free to post about it in the comments.

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