Cryptocurrency CFDs FAQ
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Use our advanced search to explore support pages- Which Cryptocurrency CFDs do FOREX.com offer?
- How do Cryptocurrencies work?
- What is a digital wallet?
- Do I need a digital wallet to trade?
- How can I trade Cryptocurrency CFDs?
- How much are Cryptocurrencies worth?
- How does FOREX.com price Cryptocurrencies?
- Is there an overnight financing charge for holding Cryptocurrencies?
- Does FOREX.com offer a Cryptocurrency CFDs trading platform?
- What is the FOREX.com policy on forking?
- What are the margin rates to trade various Cryptocurrency CFDs?
- What are the available trading hours for Cryptocurrency CFDs?
- What is FOREX.com's liquidation process?
Which Cryptocurrency CFDs do FOREX.com offer?
FOREX.com currently offers five Cryptocurrencies which can be traded as a CFD, these are Bitcoin, Ethereum, Litecoin and Ripple.
Cryptocurrencies are digital currencies, often peer-to-peer electronic cash systems which have become popular over the past few years and are founded on blockchain technology. Cryptocurrencies are not controlled or regulated by central banks, governments or traditional financial centres but are rather managed by corporations using secure blockchain verification for all transactions.
How do Cryptocurrencies work?
Because Cryptocurrencies are not regulated in the traditional sense by a central bank or government, they requires a system of distribution. Often Cryptocurrencies are “mined,” which means Crypto miners use time, powerful central processing units (CPUs) and large amounts of electricity to solve complex equations which add transaction records to a Cryptocurrency’s public, digital ledger or blockchain.
What is a digital wallet?
Most Cryptocurrencies are stored using a digital wallet, which is essentially an online bank account which stores Cryptocurrencies
Do I need a digital wallet to trade?
No – When you trade CFDs on Cryptocurrencies you are speculating on price movements in the Cryptocurrency market rather than owning the underlying asset.
How can I trade Cryptocurrency CFDs?
At FOREX.com you can trade Cryptocurrencies as a CFD. For more information, including pricing details, on these please view our relevant Cryptocurrencies CFD Trading pages:
- Bitcoin CFD Trading Information
- Ethereum CFD Trading Information
- Litecoin CFD Trading Information
- Ripple CFD Trading Information
How much are Cryptocurrencies worth?
Like any asset the price of Cryptocurrencies may rise and fall and due to high volatility in the Cryptocurrencies market. Prices may surge or drop at greater rates than for more traditional assets. At the end of 2017, the total Cryptocurrency market cap was thought to be roughly $639 billion.
How does FOREX.com price Cryptocurrencies?
Cryptocurrencies are traded on multiple independent digital asset exchanges around the world and the diversity of these exchanges can mean that there are different prices for Cryptocurrencies at different times and in different regions.
FOREX.com offers competitive Cryptocurrency pricing based on prices models provided by multiple digital asset exchanges.
We use industry leading digital asset exchanges to produce a volume weighted average price that is representative of the underlying market. You can view our pricing information on our Cryptocurrency page or in the Market Information sheet in platform.
Is there an overnight financing charge for holding Cryptocurrencies?
Yes. Overnight financing is charged at 0.0411% per day for all Cryptocurrencies (May change due to market conditions. For a full list of charges, see our Cryptocurrency pages for Bitcoin, Ethereum, Litecoin and Ripple).
Due to the higher than normal levels of volatility in the Cryptocurrencies market we strongly advise against holding positions overnight.
Please note: Cryptocurrencies financing charges are only applied to live trading accounts at FOREX.com. Should you wish to calculate what financing charges would be on a relevant demo account position, you can do so using the formula below:
Size of position x closing price x financing charge (0.0411%) = Cost of financing
Does FOREX.com offer a Cryptocurrency CFDs trading platform?
Yes - you can trade all of our Cryptocurrencies via CFDs on our Web Trader desktop platform, as well as on our mobile trading app, available for iOS and Android.
What is the FOREX.com policy on forking?
In the event that the current Cryptocurrency splits into two, new Cryptocurrencies are created, this is known as a hard fork. We will generally follow the Cryptocurrency that has the majority consensus of Cryptocurrency users and will therefore use this as the basis for our prices. In addition we will also consider the approach adopted by the exchanges we deal with, which will help determine the action we take.
We reserve the right to determine which Cryptocurrency unit has the majority consensus behind them. As the hard fork results in a second Cryptocurrency, we reserve the right to create an equivalent position on client accounts to reflect this. However, this action is taken at our absolute discretion, and we have no obligation to do so.
If the second Cryptocurrency is tradeable on major exchanges, which may or may not include the exchanges we deal with, we may choose to represent that value, but have no obligation to do so. We may do this by making the product available to close based on the valuation, or by booking a cash adjustment on client accounts.
If, within a reasonable timeframe, the second Cryptocurrency does not become tradeable, then we may void positions that had previously been created at no value on client accounts.
Over periods of substantial price volatility around fork events, we may take any action as we consider necessary in accordance with our terms and conditions including suspending trading throughout if we deem not to have reliable prices from the underlying market.
What are the margin rates to trade various Cryptocurrency CFDs?
The margin rate for Cryptocurrencies is 50%.
Margin for 1 CFD =Amount of CFDs (1) x Cryptocurrencies Price (18,000) x 50% margin = Total margin (USD9,000)
What are the available trading hours for Cryptocurrency CFDs?
Crypto CFDs markets will be open through the weekend with our live prices – closing Saturday, 7am AEST (Friday 9pm UTC) and reopening Saturday, 6pm AEST (Saturday, 8am UTC).
What is FOREX.com's liquidation process?
You are responsible for monitoring your account and maintaining 50% of required margin at all times to support your open positions.
If at any point the equity in your account drops below 50% of the required margin, your open positions will be subject to auto-liquidation. The liquidation process depends on the trading platform that you are using and, in the case of certain CFD markets, the timing of the liquidation:
- Proprietary FOREX.com platforms (during normal market hours):
The net aggregated open position with the greatest unrealized loss first will be subject to liquidation first, followed by the net aggregated open position with next largest unrealized loss, and so on, until the maintenance margin requirement is satisfied or exceeded. Depending on the size and unrealized P&L of your positions, all open positions may be liquidated to meet the margin requirement. - Weekend Cryptocurrency CFD trading:
Over the weekend*, only cryptocurrency CFD markets are open and tradable. Therefore, if the equity in your account drops below 50% of the required margin during the weekend, your cryptocurrency CFD positions will be subject to liquidation — regardless of whether they are in profit or loss — and we may close any or all of your cryptocurrency CFD positions while your account equity remains below the 50% margin requirement over the weekend. During normal market hours, cryptocurrency CFD liquidations will be handled in accordance with the procedures described in the applicable platform sections above. Positions in other asset classes that are not actively trading will not be liquidated during the weekend; however, your account may be subject to further liquidations when other markets open depending on your available margin at that time.
*“Weekend” means the period between the normal market close time on Friday (or Saturday, depending on your time zone) and the normal market open time on Sunday (or Monday, depending on your time zone). Please refer to the trading platform for market hours for the time zone where you are located.
You can also set up alerts so you are notified by e-mail when the available margin in your account falls below 120% of the margin requirement. Please note that this notification is for your convenience only and should not be relied upon to protect your account.
FOREX.com standard accounts feature negative balance protection, which means your account balance can never go negative. We’ll also aim to close positions on your behalf if your margin drops below 50% of the total requirement.
If you upgrade to a Pro account, then your losses will be able to exceed deposits – which means your account can go negative.