Technology plays a major role in modern life and has positively disrupted many industries lately. One example of this is trading on the world’s financial markets. Where you once had to visit the stock market floor in person to do this or work in a professional investment setting, online tech has opened up trading to more people than ever. Online brokers now mean that you can start trading with just a desktop/mobile device, an internet connection, and some starting capital.
One market that has become very popular to deal with in recent times is the tech-heavy crypto market. This sees people investing in digital currency, such as Bitcoin, to make money from its price movements. As well as being purely digital, cryptocurrencies also have one other unique feature that appeals to traders: blockchain. But what is it, and how does it help in trading crypto?
What Is Blockchain Technology?
Before we dig deeper into how blockchain helps crypto trading, it is worth pinning down exactly what it is. For a more in-depth look at this tech and trading cryptocurrencies in general, the beginner’s guide to crypto trading at AskTraders is worth a read. This guide comes from a trusted source of advice for traders online and tells you more about crypto trading in a concise, easy-to-grasp manner.
What exactly is blockchain tech? In simple terms, it is the foundation on which all cryptocurrencies are built and a digital ledger system. Blockchain tech enables crypto to be a peer-to-peer decentralized network and makes cryptocurrency records almost impossible to tamper with. Although it started out being used just in the crypto sector, its unique features are also being seen in banking and finance now.
How Does Blockchain Help In Crypto Trading?
In the simplest of terms, blockchain helps in the trading of crypto by making it possible. Cryptocurrencies, for example, would not exist without this tech behind them and so would not be around to trade at all. Blockchain tech is also a vital part of the financial side of trading in digital coins.
Without this tech behind cryptocurrencies and trading platforms, dealing in digital cash would not be as easy and it would not come with the same level of trust. As blockchain is known to guarantee a high level of security and to be very hard to tamper with, more people are willing to give crypto trading a go.
What Unique Benefits Does Blockchain Bring To Crypto Trading In Particular?
Alongside the practical help this tech gives, it also has some unique benefits that appeal to traders. What might these be?
As we have already alluded to above, one distinct feature that this asset has is high-level security. From the importance of cryptography in network security to data encryption and the accuracy of the central ledger on a blockchain network itself, this is a big plus for traders. It means that people can trade in crypto without having to worry about becoming victims of cybercrime and being scammed.
The lightning-fast speed of blockchain tech is also a bonus for crypto traders and means that transactions are carried out far quicker. The use of smart contracts, which this technology promotes, means that transactions are carried out digitally and in a more efficient manner. This is great news for traders because orders are executed faster and at the exact prices specified.
What Other Distinct Benefits Does Blockchain Bring To Crypto Trading?
One other unique benefit of blockchain for trading in cryptocurrencies is the way that it decentralizes this activity. This means that any trades you place are done without needing to go via the traditional centralized banking system but direct via blockchain networks instead. As well as speeding up the whole process even further, there are no intermediaries involved in transactions to interfere with them or make mistakes. For many crypto traders, this is a real plus point.
For more articles on everything tech, check our blog here on TechJournal.org.
You also have to look into the issue of transaction fees when it comes to the distinct features this tech delivers. The traditional way of trading can often involve high trading or transaction fees being applied to orders you make. Blockchain tech means that you deal directly with the market and, therefore, any attached fees are brought right down.
Blockchain Is Key To Crypto Trading
As the above shows, this technology is not only key to being able to trade crypto, but also has many unique benefits that appeal to traders. As coins such as Bitcoin continue to hit the headlines in the future, it will be interesting to see the rise of blockchain across society.
