The modern world is constantly changing. Today, blockchain technological advances have made it possible to decentralize finances and currency. Bitcoin, one of the most common cryptocurrencies on the market, has grown remarkably in the last few years. This growth can be attributed to the strong security and ease of doing business that cryptocurrency markets have to offer. But how are cryptocurrencies and commodity trading related? In simpler terms, how are commodities transacted in the virtual marketplace?
To begin, it is important for you to understand what cryptocurrencies and commodities are and how they interact in a virtual and economic ecosystem.
What Is A Cryptocurrency?
Cryptocurrencies are an internet-based medium of exchange that is not controlled by a central government. They leverage blockchain technology to achieve immutability, transparency, and decentralization. Perhaps the most common cryptocurrency on the market is the bitcoin but there are other cryptocurrencies available such as the bitcoin, Ethereum, Ripple, and Dash.
What Is A Commodity?
A commodity is a raw material or a basic good in a trade that businessmen buy and sell. The commodities market acts as a foundation for global trade systems since it provides the building blocks for the production of complex goods and services.
A good example of a traded commodity in the world is coffee. The global coffee market is huge and the steady growth of this market can be attributed to the overwhelming supply of the commodity and the global demand for this popular beverage.
What Is A Crypto-Commodity?
A crypto commodity can be defined as a tradable asset that represents a commodity or a utility on the blockchain network through the use of exclusive tokens. One great benefit of crypto commodities is that it provides a safe haven for investors.
During times of market turbulence, crypto commodities can limit your exposure to loss and help you to maintain the value of your investment over time. Secondly, crypto commodities give you the freedom to trade on any platform. Compared to centralized systems where assets are put in the custody of banks, crypto commodities are not held custody to any banks and switching costs are negligible.
If you have been thinking about venturing into crypto commodities consider a crypto / coffee investment with Virtuse Exchange. Virtuse Exchange uses Digital Asset Collateralized Contracts (DACC) which enables you to convert your cryptocurrency into commodities without having to transfer money from one account to another. Thanks to DACCs you can buy and sell crypto coffee flawlessly without having to worry about price volatility.
Here are a few tips on how to trade crypto and commodities online.
1. Choose the Best Exchange for Crypto Commodity Trading
The first thing you will need to do is to choose the safest online exchange platform on which you will trade. You should make sure that the site is not only licensed but also registered with a reputable organization.
The exchange company you work with should also be one that adheres to the stipulated codes of standards and ensure that their operations are legal and follow the best practices of the industry. This is very important because it gives customers the assurance that their interests are protected and their funds are secured. The last thing you need is to find out that the exchange disappeared with your hard-earned investment.
Be sure to also check the history and the reputation of the exchange company. Find out when the company was founded and how long they have been in business. A company that has been trading for a long time could be a good sign that it is legitimate. You should also consider the fees the company charges before opening an account with them. Remember very high broker’s fees will eventually eat into your profits.
2. Open an Account
Once you are sure about the exchange you will work with, you will need to open an account. Opening an account is a simple process that can be done entirely online in just a few minutes. However, if the exchange firm needs more information from you they will contact you before your account is approved.
Once your account is approved you will be given your account number, password, and additional instructions. Many reputable exchange firms and brokers will not put you under obligation to fund your account once you have finished your application.
3. Fund Your Account and Start Trading
You will need to put funds into your crypto wallet before you place your first trade. Funding your wallet is a simple process as you can use bitcoin ETH or your debit or credit card to transfer money into your wallet.