cryptology-exchange

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DeFi Industry Transaction Volume Exceeds $ 270 Billion

Over the past year, decentralized finance has become a real trend. The reason for this is quite simple: the usual centralized banks do not do their job well enough. Lending, transactions, and other services are not performed so quickly and efficiently.

DeFi is a decentralized finance service that aims to replace the banking sector. They use distributed ledger technology and digital currencies as legal tender.

Practice has shown that decentralized finance is doing an excellent job. Cross-border payments are carried out almost instantly, loans are issued against collateral in cryptocurrency, and the system is reliably protected from hacks.

DeFi Industry Transaction Volume

Even at the beginning of 2020, few people heard about decentralized finance. There were several projects in the top 100 CoinMarketCap, but they were not very popular.

For 2020, the industry has grown 12x, according to a DappRadar report. From 22.5 billion US dollars to 270 billion US dollars.

In part, this volume of transactions has a positive effect on Ethereum as well. Since most of the tokens are ERC-20 tokens that belong to the ETH network.

DeFi provides one interesting tool that cryptocurrencies previously could not boast of. Profitable farming. You simply block tokens within the network and receive a reward for them. Money makes money - the main principle of capitalism.

What are the prospects of DeFi?

Most of the projects could not be fully implemented due to technical limitations of the same Ethereum network. Contrary to the opinions of many critics of decentralized finance, upgrading the ETH network to 2.0 will remove many of the restrictions that previously held up projects.

After the network upgrade and the transition of ETH to PoS, the cost of transactions and their speed will be significantly increased, which will solve the long-standing problem of DeFi - high fees.

Commissions for DeFi projects are high only for decentralized exchanges. Therefore, CEX comes to your aid. Using the centralized Cryptology exchange, you can trade DeFi tokens with the lowest fees and leverage up to 100x.

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How To Trade On The Cryptocurrency Exchange in 2021: A Step-By-Step Guide From Cryptology

Cryptocurrency trading is inextricably linked to technical analysis. Therefore, we would immediately like to dispel one myth. A lot of fiat traders say technical analysis doesn't work.

The cryptocurrency market is not yet that big when compared to the fiat asset market. There is a certain delay between the processing of all orders, which is very predictable.

Due to the small market, the amplitude of the noise will always be lower, and the psychological factor among users will be higher.

It is for these reasons that mathematics in the cryptocurrency market works much more efficiently than in the traditional finance market.

One. How to choose the right cryptocurrency exchange?

If you are going to become a serious trader, your choice inevitably falls on CEX (centralized exchanges) solutions. Why? First of all, CEX exchanges have more liquidity. In addition, fees are much lower there than on decentralized exchanges.

Two. Risk management.

Risk management can be characterized by the following five rules:

Never invest all your funds in one asset

The exchange is a place where you can both earn and lose. Therefore, only invest the money that you can afford to lose.

Keep a diary of transactions. Write down successful and unsuccessful decisions.

Do not trade altcoins with low liquidity and a dubious reputation.

Don't take unnecessary risks. Control your emotions. Better to make less profit than to lose everything.

Three. Technical analysis.

Technical analysis focuses only on previous market data. Thanks to him, as already described above, you can very accurately determine the behavior of an asset using mathematical methods. Technical analysis does not have a large number of strategies, and you need to know them since this is the basis. In addition, bots can be used. They will greatly simplify your life.

Four. Arbitration.

Arbitrage is a method of making a profit when you earn on the difference in the price of a cryptocurrency on various exchanges. How does it work? For example, on exchange A, ETH is worth $ 1,700, and on exchange B, it costs $ 1,750. You take a loan of $ 17,000 from a broker, buy ETH on exchange A and sell on exchange B. The difference of $ 500 is left to you. From it, you can deduct commissions and take profits.

It is most convenient to trade cryptocurrency assets on the Cryptology exchange. Leverage up to x100, low commissions, and many tools for technical analysis. Join us!

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7 crypto events that defined 2020

For most of us, 2020 has been a year of major upheaval and change. The events of this year did not pass by the crypto industry, which has seen both downs and new ups. Let's take a look at the key events of 2020 that affected the crypto industry the most.

Coronavirus pandemic

For the first time, COVID-19 was registered in China, in December 2019, but the whole world began to respond to the Coronavirus pandemic only in early 2020.

Markets reacted with panic to the situation with widespread lockdowns and quarantines, causing a collapse of the cryptocurrency known as "Black Thursday". As you can remember, the major currency dropped in value by 50% over the day. The crash resulted in liquidations as peaks in network congestion prevented many investors from adjusting their collateralized debt positions, and Maker was hit hard by the DAI losing its peg.

Bitcoin Halving

Bitcoin Halving is a halving of the reward for miners for each mined block. It is not tied to a specific date, it occurs every 210,000 blocks. Bitcoin halving has been the subject of heated debate over whether it will trigger new price highs. As we now see, those who predicted a rise in the price of Bitcoin were right. Although the growth factors in the value of the coin were different.

End of the bear market

The fall in the cryptocurrency market was followed by its stabilization, and then the rise in prices of top currencies. So, at the beginning of 2020, Bitcoin costs about $ 7200, but in February the main cryptocurrency broke the resistance barrier of $ 10,000, and the cost of Ether doubled. Following this news, the cryptocurrency market began to rally, foreshadowing the end of the bear market. Now the crypto market has revived and is growing rapidly.

Boom of Yield Farming

In the summer of 2020, the concept of liquidity mining became very popular. It's about the COMP token and the Compound decentralized lending protocol, which climbed to the top of DeFi ratings in less than a week after launch.

Despite the fact that liquidity mining existed even before Compound, because of the hype around COMP, the real madness around "yield farming" began. This was followed by the so-called "food tokens" which offered huge profits to any liquidity provider in DeFi.

DeFi Market Reaches $ 10 Billion TVL

In early 2020, the DeFi sector locked-in value (TVL) was over $ 600 million, but it wasn't until the summer that the niche really took off.

In early fall, over $ 10 billion was locked into Ethereum-based DeFi protocols, and the Metmask wallet has 1 million monthly active users. Today TVL DeFi is approaching $ 15 billion.

As the sector expands, key indicators suggest that decentralized finance will continue to grow.

Fighting stablecoins against hyperinflation

In 2020, stablecoins gained huge popularity. One of the reasons was the addition of collateral by DeFi users to the protocols. Also, Circle's partnership with the Bolivarian Republic of Venezuela and Airtm was a key factor. As you remember, Venezuela suffered greatly from hyperinflation. Cryptocurrency in this situation has become a real lifeline for the inhabitants of the country.

Visa adds payments in USDC

It was a surprise to everyone that Visa announced its willingness to work with Circle, which will partner with it to enable USD payments to 60 million merchants around the world. It is also planned to issue a special card for USDC payments, the ERC-20 token, which is pegged to the US dollar 1: 1.

Join Cryptology, buy, sell and trade cryptocurrencies on the most favorable terms!

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Cryptoanalytics: 5 Key Resources for Monitoring Cryptocurrency Prices

Together with the crypto industry, sites began to develop that accumulate statistical data, store historical information, build charts and can even influence the market. Let's take a closer look at the top 5 key resources for monitoring cryptocurrency rates.

CoinMarketCap

CoinMarketCap is known to both newcomers and old-timers of the industry. It is a free tool for surface analysis of cryptocurrencies. If a new coin appears on the market, basic information about it will soon be found on this website.

The main page, by default, shows the rating of coins by capitalization, indicating prices, trading volumes per day, the amount of currency in circulation, and other data. Information is updated every 5 minutes.

You can study the graph of the cost of each coin in more detail, go to the official website of the project, or see the development data. CoinMarketCap works stably, looks simple and understandable, quickly provides the necessary information, and does not annoy with unnecessary functions.

СryptoСompare

CryptoCompare is not limited to charts and statistics, publishes articles, tops, and training materials, collects news, maintains a forum, and allows you to track your personal investment portfolio.

The site has sections for traders, miners, investors, and ordinary users. There are reviews and ratings of crypto exchanges, wallets, ASICs, video cards, and ICO projects.

A visitor can create a profile, subscribe to cryptocurrencies or companies of interest, track transactions on different trading platforms, study historical information, and analyze the impact of social networks on the market. The price data on the site changes in real-time.

Coin360

The site is a single tiled chart where each coin has a rectangle that is sized according to market share. On the site, you can see the price chart, daily changes, and trading volumes, market capitalization, and the protocol on which a particular cryptocurrency operates. In the side menu, you can filter data by type of currency and time, remove unnecessary coins and configure other parameters.

Despite the minimum of functions, Coin360 can quickly and visually represent both the state of the entire market and a specific currency. The site looks especially impressive during periods of total decline or growth.

Live Coin Watch

The main opponent CoinMarketCap appeared in September 2017 and has already managed to win back some of the audience. It has real-time data updates, a personal portfolio, a news aggregator, and other small, but handy options.

Live Coin Watch (LCW) received its first wave of popularity when CoinMarketCap suddenly removed data from South Korean crypto exchanges from its statistics, which slightly dropped the prices of cryptocurrencies. The creators of LCW quickly got their bearings and added a simple switch to the site for information from South Korea.

CoinCheck

The site positions itself as a research platform for the cryptocurrency market. Its simple interface hides interesting features. For example, a price forecast for the next year, a summary of the profitability of each coin since its launch, and a cryptocurrency rating based on a heap of objective data: developer activity, brand and product quality, communication in social networks, and other features of a particular project.

According to the creators, CoinCheckin appeared in order to make the cryptocurrency market more transparent. The developers were engaged in investments, did not find a suitable resource, and created their own with fundamental analysis and predictive algorithms.

Trade cryptocurrencies with Cryptology. Buy, sell and exchange currencies at the best price!

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Cryptocurrency arbitrage trading: how it works and why you need it

Arbitrage trading is a de facto risk-free way of earning income from the price difference of at least two assets that are identical or similar in certain characteristics.

The topic of arbitrage trading attracts, first of all, the largest institutional players in the market. In modern realities, arbitrage is the most powerful algorithmic trading systems of large banks and hedge funds with which a person is practically unable to compete.

But still there are some methods and markets where you can successfully practice "manual" arbitrage trading for an ordinary trader who does not have a team of programmers and huge capital behind his back.

There are quite a few types of arbitrage transactions, but in this article we will talk about statistical and intermarket arbitrage, because these methods are the simplest and most readily available if you are not an institutional trader.

Intermarket Arbitration

This trading style implies the conclusion of multidirectional deals on the same instrument in different markets, provided there is a sufficiently large difference in price.

In simple terms, to conduct such a transaction, you must buy, for example, bitcoin on exchange A for $ 14,500 and transfer it to exchange B as quickly as possible with its subsequent sale for $ 14,800, if you do everything correctly, you will theoretically get $ 300 instantly profits from one bitcoin. The next logical step is to withdraw money from Exchange B and repeat the process until the rate levels off and the arbitrage opportunity disappears.

This process is called an arbitration circle. But there are some pitfalls here. Do not forget about the exchange commissions, as well as the Bitcoin commission network, which can “gnaw” all your profits from an arbitrage transaction, so after you notice an attractive arbitrage opportunity at first glance, first calculate all the commissions that you will need to pay for the arbitration circle.

Almost all instruments that are available on at least two exchange markets that you have access to can be used for arbitrage. It was not by chance that I cited bitcoin as an example of an arbitrage tool, since I think that the cryptocurrency market is now practically without competition and is available for "manual" arbitrage. It certainly does not abound with opportunities on every corner, but there are opportunities, which cannot be said about the stock market. On it (on the fund), there is currently a struggle between arbitrage trading algorithms, which almost instantly detect and use arbitrage opportunities, thereby eliminating them without even allowing the human eye to notice them.

Statistical arbitration

This type of arbitrage transactions, unlike the previous one, does not provide for trading on different stock exchanges. Its essence lies in the conclusion of multidirectional transactions of two or more statistically or fundamentally similar assets. In the stock markets, this type of arbitrage is handled by a certain category of hedge funds that specialize in the so-called Stat Arb.

Ordinary retail traders have only the opportunity to engage in pair trading, which is the basic principle of all algorithmic systems working in this direction.

As you might have guessed, the essence of pair trading is to trade a pair of instruments at once similar in certain characteristics in different directions. A good place for pair trading is the American stock market — NYSE, NASDAQ, AMEX.

To search for an arbitrage pair in this market, you can take stocks from one economic sector and look inside it for stocks of companies that are doing about the same thing. After a list of stocks by sector has already been formed, you can check their statistical correlation, which shows how much the charts of the shares of two companies are historically similar to each other.

How to earn on arbitration

To make significant profit as a result of cryptocurrency arbitrage, it is necessary to operate with large assets, take into account the speed of transaction processing, repeat purchase and sale cycles many times and not neglect automation where possible.

The secret of the most profitable transactions is to accurately determine the moment when the difference in rates has reached the greatest value. Taking into account the fact that the costs of paying off commissions can reach 5% of the amount of assets, in order to make a profitable transaction, a difference in rates equal to 5-8% is required. In the case of static arbitrage, when a trader compares changes between two currency pairs with one common denominator, a difference of at least 5% is considered profitable.

Come and trade on the Cryptology cryptocurrency exchange to take advantage of the benefits of DeFi tokens, low fees, futures and spot trading, strong security, and more!

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Understanding the nuances of cryptocurrency capitalization

What is capitalization?

Let's explain in simple language what capitalization is. The price of one share of a company does not speak of the very value of the corporation. For example, the price of X shares is less than $ 5, but the company itself may be three times more expensive than "Company Y", whose shares are worth $ 600.

To have an idea of ​​the market value of a company, you need to calculate its capitalization. Currency capitalization shows its current value on the stock exchange.

For such a calculation, you need to multiply the current price of shares by their number (Current Price x Quantity = Capitalization). If a corporation trades common and preferred shares, then the total capitalization for each type of securities is calculated first, and then the results are summed up. If shares are traded on several exchanges, then capitalization will be calculated based on the share price on one exchange.

Cryptocurrency capitalization

Despite its tensions, 2020 has hit everyone with the growth rate of cryptocurrency. At the time of February 2020, the capitalization of cryptocurrencies exceeded $ 300,000 billion.

The year 2021 for the cryptocurrency started extremely well - as of January 6, the capitalization of the cryptocurrency market approached $ 1 trillion.

The market value of digital funds has risen sharply against the background of Bitcoin reaching a new all-time high, above $ 35.7 thousand, as well as an increase in the value of altcoins.

Such a sharp jump in the demand for digital currencies is due to the fact that people with an entrepreneurial mindset began to look for ways to stay afloat, or even improve their standard of living. That is why many began to consider cryptocurrency and the blockchain sphere as an alternative way to earn money.

Continuing to follow the statistics of the rising prices of cryptocurrencies, we see that their growth is gaining momentum almost exponentially.

What are the nuances of cryptocurrency capitalization?

To calculate the capitalization of a cryptocurrency, multiply the total number of tokens by the rate of one coin (total number x rate of 1 token = capitalization). This formula is similar to the formula for calculating the capitalization of exchanges.

The capitalization of crypto assets is not always considered objective, since they do not always have value as behind company shares.

The main nuance of cryptocurrency capitalization is that many enterprises try to keep some of the tokens for their needs and release only a part for sale. The DeFi system does not allow one buyer to purchase even half of all coins. After no more than ten percent of tokens are placed on the exchange, the capitalization of crypto money, in most cases, cannot be considered objective.

The cryptocurrency mechanism is designed so that most of the asset will not be listed on the exchange but remains with the investor in the form of a long-term investment.

Remember that trading in financial instruments and/or cryptocurrencies involves high risks. Before deciding on a transaction, you should get information about all your risks.

The Cryptology platform will allow you to trade on the most favorable terms, learn more at Cryptology

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Pump and Dump schemes in cryptocurrencies: how does it work and can you make money on it?

The Pump and Dump scheme originated long before the advent of cryptocurrencies.

Pump and Dump is a manipulation scheme that increases the rate of a cryptocurrency, followed by a price crash.

This scheme got its name due to the fact that large asset owners artificially increase, as if pumping, their value, in order to subsequently “dump” it as unnecessary, selling the asset as expensive as possible. As a result, the value of the asset falls and investors lose money.

At the time when the "Pump & Dump" scheme arose, it began to be actively used in the American market of "junk" or "penny" stocks in the late 20s - early 30s of the XX century, when there was the Great Depression. At that time, stockists sold low-value shares to each other, which led to an increase in demand and higher prices, after which the shares appeared on the public market. In the United States, this practice was declared illegal. The finest hour of Pump and Dump schemes in the stock market came in the early 2000s.

Pump and Dump can be short term and long term.

The short-term scheme lasts from a few minutes to a maximum of several hours. Used with unknown cryptocurrencies with low capitalization;

The long-term scheme lasts from several days and more, and the ups and downs of the rate have a number of stages.

Algorithm of the "Pump and Dump" scheme

Part one. The organizers, choosing the exchange and currency, buy tokens in small portions because otherwise, they provoke a premature rise in the rate. Often these are unknown cryptocurrencies that do not have a high capitalization. Although sometimes relatively large cryptocurrencies are used for "Pump and Dump".

After the purchase of the token, the "pumping" starts. Wherever it is possible to do this, the announcement of the upcoming growth of the rate is published and the name of the exchange site is announced. On this site, the organizers of this scam, through their bots, place and take away large permits for the purchase of a token, raising its rating.

After investors know about the pump in advance, they are confident in guaranteed earnings. But the investors themselves become victims, and some of them even pay to subscribe to such pump channels to follow the news, but unfortunately, they often do not win anything.

If the advertisement is successful, then the second part of the pump will begin. In this part, third-party investors appear who, independently of anyone, influence the increase in the rate. Against the background of this fever, the price rises, the organizers sell tokens at an inflated cost, after which the cryptocurrency rate returns to its original indicators.

Earnings on the "Pump and Dump" scheme

If we talk about the short-term form of the scheme, then it is unlikely to make a profit from such a pump, because profit is possible only for the organizers, since ordinary traders do not have time to react.

With a long-term pump, things go better, and theoretically it is possible to withdraw profits and a trader can rely on profits, however, in this case, he has no more than three to five minutes to publish documents. Moreover, the probability of losses is equal to the probability of profit.

Most of these transactions have one difference: after the first crash, there is a new short-term growth due to the fact that retail investors are included in the trade.

Trade cryptocurrencies on the most favorable terms at Cryptology!

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How will the new coronavirus mutation affect the crypto market?

Increasingly, news from various countries began to appear that a new strain of coronavirus had been discovered. Denmark was the first such country. Following her, similar messages came from the UK, and after that new mutations were discovered in Australia and the Netherlands.

Naturally, the market immediately reacted to this news with a drop. So, for example, the S & P500 index sank 1.5%, while Bitcoin by an impressive 9%.

However, we already observed such a situation at the beginning of the pandemic. However, unlike stock indices, cryptocurrencies recovered very quickly, subsequently showing rapid growth.

Like last time, investors see the new mutation of the coronavirus as another big threat to the global economy.

In addition, the behavior of the governments of the most economically developed countries of the world also influences this. As long as the economies of countries such as the United States, Germany, Great Britain, France, the Netherlands, and others are subject to the negative impact of quarantine measures and lockdowns, significant economic growth cannot be expected.

How can this affect cryptocurrencies?

If the information from the UK government is correct and the new strain of the virus does indeed spread 70% faster, then countries will have to tighten quarantine measures.

As we noted above, this can have a positive effect on cryptocurrencies. In times of falling markets, investors often withdraw capital and look for alternatives. Today, such an alternative is crypto assets.

Most likely, there will be a slight correction against the background of general panic, and then there will be rapid growth.

There is also an alternative opinion. Against the background of the fact that the population will need capital, which some have stored in cryptocurrencies, massive withdrawals of assets from the market may begin, if we are talking about ordinary investors and not big whales. Due to the withdrawal of capital, assets can seriously fall in value.

Thus, the behavior of the market depends only on the quarantine measures that the governments of the countries will take. If the quarantine measures are tough, then most likely, the market can expect a fall followed by recovery and growth. One way or another, cryptocurrencies have already established themselves as an excellent "protective asset", therefore, even strict quarantine measures will again benefit the crypto market, because more and more people are switching to this type of investment.

And you can buy cryptocurrencies at the best prices using the Cryptology exchange.

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Why cryptocurrencies have high profitability: talking about the prospects

Today we are entering a new stage in the transformation of money, in which money becomes information. In this sense, cryptocurrencies have become true pioneers, as they offer users services that banks do not offer.

For example, one-click cross-border payments. Using cryptocurrencies, you can instantly send any amount to a person with one click of the mouse, even to another continent. In addition, coins have a higher yield, which is particularly attractive to investors.

The most important question that interests many investors: where is the profitability so high?

Let's pay attention to the modern financial market. It gives a very low percentage rate of return. Especially taking into account the fact that the Central Bank is lowering the interest rate since inflation is falling and economic growth is slowing down.

This is the main difference between cryptocurrencies and fiat. The number of coins that miners can mine is strictly limited. This means that cryptocurrencies are subject to deflation and will only rise in value in the future.

In addition, the political and economic situation also affects the price of cryptocurrencies. As the crisis that the world faced in 2020 has shown, any financial turmoil forces investors to look for alternative ways to make money and cryptocurrencies come to mind here involuntarily.

In addition, more and more services and people are accepting cryptocurrencies as a means of payment. It's just convenient. Transactions are instant and completely transparent.

It is also worth noting that the volatility of cryptocurrencies attracts traders who can trade on a short position and increase the market volume, and therefore the price.

The development of cryptocurrency exchanges makes purchasing much easier. There are also many financial instruments that are associated with them. For example, futures.

What are the prospects for cryptocurrencies?

Today we see an increase in the number of startups that are associated with cryptocurrencies, which often reach the status of "unicorns" as they attract investors with their solutions and innovations.

Also, by investing in cryptocurrencies today, you get high returns, as well as a deflationary financial instrument that can give you profit even in times of crisis.

Using the Cryptology exchange, you can buy crypto assets on the most favorable terms, simply and quickly.

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Best Cryptocurrency Pairs to Trade in 2021

When trading on the exchange, you come across cryptocurrency pairs in one way or another, because in order to obtain, for example, Bitcoin, you need to buy/exchange it for another currency/asset.

Most often, this “other asset” is USD, since it is a world currency, it is the most popular and massive, or USDT. Many people are accustomed to paying in dollars and translating the price into dollars, as it is just convenient.

When choosing trading pairs, it is important to pay attention to the following aspects:

Market capitalization. Coins with low market capitalization show quite strong price spikes even in a very short period of time. So, young altcoins sometimes grow by 150% in a couple of hours in the afternoon, and later fall by 400–600% in the evening. Therefore, we definitely need coins from the top 25.

Coin type. It is most convenient to trade with stablecoins, since you always know the rate of stablecoins, due to the fact that they are tied to a specific fiat asset. For example, USDT.

Coin graph. If during the day the coin shows strong jumps, even despite the large volume (as is often the case with XRP, for example), it is better not to use it as a trading pair and choose something smoother.

Latest news. The crypto market is based on news and it is important to understand the informational background of the coin you have chosen to trade.

So what does a list of the top five cryptocurrency pairs look like based on these criteria?

BTC / ETH

BTC / USDT

ETH / USDT

ETH / LTC

BTC / LTC

Why them?

Bitcoin is considered the most important coin for a reason. If you see an increase in the price of BTC, you can safely trade for an increase in BTC relative to LTC and ETH. Because their growth of these three coins is often correlated with each other.

Choosing a USDT trading pair is a great option for traders as USDT is a stable asset. You can bet on the fall of BTC in price against the dollar and be sure that nothing happens to the paired coin.

It is best to trade these currency pairs on the Cryptology exchange, as we provide up to 100x leverage and the most favorable commissions.

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What is a spread in crypto trading and how to take it into account?

The spread in crypto trading is the range between the price at which coins are sold and the price at which they are bought. As a rule, these are two different prices, since buyers want to buy at a lower price, and sellers want to sell as expensive as possible - this is the spread.

If you are going to seriously engage in crypto trading, then we strongly recommend that you thoroughly study this topic. In particular, it is on spreads that honest brokers make money. And since each brokerage firm has its own tariffs, the earnings are also different.

Some brokers make money exclusively on spreads as they can be quite large. The minimum spreads are set by market makers. As you move towards the end trader, the spread increases. And in accordance with it, the earnings of dealing centers and brokers' commissions increase.

The essence of the spread in crypto trading

Consider the following simple example. Let's say you want to buy bitcoins from someone. When negotiating a purchase, you can say that you are willing to pay $ 10,000 for one bitcoin. This is the ask price. But the seller believes that bitcoin is more expensive and he refuses to sell it for less, for example, for $ 12,000. This is a seller's price offer.

The difference between the bid price of $ 10,000 and the bid price of $ 12,000 is $ 2,000 - this is the spread. The higher the spread value, the higher the market liquidity.

Spread size = cost of the exchange transaction. Remember that traders do not buy and sell on the exchange, but brokers. Although the reality is that their presence in the work on the exchange is imperceptible.

The size of the spread depends on the following factors:

liquidity;

the number of trades for a specific cryptocurrency pair (supply and demand);

general market situation.

How to take into account the market spread?

Now that you have a better understanding of the concept of the market spread, you should know how it is calculated and how to take it into account when placing orders. It is especially important to consider the spread for scalping traders.

And at the same time, for those who trade/invest in the medium or long term, as well as for those who set large stop losses and take profit, the spread does not really matter.

How to reduce spread costs:

use limit orders;

calculate the size of your order taking into account the existing counter orders;

trade around tight spreads, i.e. in liquid markets

A limit order is a tool with which you get the opportunity to buy a cryptocurrency that you will need in the future at a price lower than its current price on the market.

The risk to reward ratio measures the difference between the trade entry point before the stop loss and a sell or take profit order.

Take profit is the automatic closing of a position when the minimum or maximum price is reached. A prudently set take profit will help you to automatically fix the profit on a position, and also save your time.

The profit target is used to chart an exit point in advance in case the trade moves in a favorable direction.

The potential profit on a trade is the difference between the target profit and the entry price.

Buy and trade digital assets with Cryptology easily, conveniently, and hassle-free!

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How to catch a trend reversal: 5 strategies to spot it

Sooner or later, any trend ends. Graphically, this is displayed as a stop of growth (or decline) followed by a reversal. How can you identify a trend reversal rather than a correction?

There are the following strategies for detecting trend reversals:

Moving averages. It is one of the best indicators for determining market movement. Yes, they will lag a little, but this is a cost in case the new trend is strong. The advantage of this method is that it gives the direction of the trend. This will allow you to hold the position for as long as possible and extract more profit with fewer risks. Alas, using this method, it is impossible to determine the trend reversal in the early stages.

Patterns. A double top pattern is an excellent option. If the price moves in the direction we need, we will be able to improve our position according to the classical technical analysis, and if the price moves in the opposite direction from our expectations, the losses will be minimal. However, with the "double top" you need to be extremely careful, as this tool requires quite a few skills.

Divergences. You can also determine a trend reversal using divergence. They have performed well in the cryptocurrency market, especially 4 years ago. The ability to enter or exit a position is extremely simple. The signal line leaving the histogram above zero tells us that it is time to sell the asset, and below zero it tells us to buy accordingly.

Oscillators. The Relative Strength Index (RSI) measures how overbought or oversold a given financial instrument is. It does not give, as such, signals that an asset should be sold or bought, but it suggests a trend reversal. When the RSI is outside the oversold level and declines, this indicates a trend reversal. The converse is also true.

Fibonacci levels. Many traders use them to identify trends. The levels consist of 6 instruments (fan, arcs, channel, timeframes, lines, and extensions) and allow you to very accurately determine a strong trend.

It is recommended to use these tools not separately, but preferably at least 3 at once. This will allow you to get the most accurate picture, as well as be as sure as possible whether there is a correction in the market or a new trend.

On the Cryptology exchange, you can find the best technical analysis tools, as well as sell or buy crypto assets at the best price.

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Pros and cons of crypto revolution: what to expect from cryptocurrency in 2021?

Over the past year, the cryptocurrency market has shown significant growth and has also experienced a number of significant changes. Decentralized finance has become popular, as well as OTC transactions. For example, investments in Bitcoin became popular in the OTC way, bypassing exchanges.

So, what are the disadvantages of the cryptocurrency market in 2021?

States have taken over cryptocurrencies. For example, in a country like the Russian Federation, a number of restrictions were introduced on cryptocurrencies. They cannot be used there as a means of payment. However, states offer an alternative in the form of R&D in the field of state digital currencies.

Sweden and China have also expressed plans to introduce their own digital currencies, which is unlikely to have a positive effect on cryptocurrency operations in these countries.

The Ripple coin also failed, with the founders of which the SEC plans to sue, and the coin itself is now being delisted on many exchanges, which means that coins, which are also closely related to banks, may also wait.

What are the advantages of the cryptocurrency revolution?

The first cryptocurrency showed rapid growth and does not plan to slow down. The record price is updated almost every day, and the daily trading volume is not planning to fall.

The Ethereum upgrade has also had a positive effect on the coin, it has already broken through $ 1000 and is also increasing the price.

Also, almost all DeFi platforms are built on the basis of Ethereum. They have shown incredible growth as they have attracted huge investments in the industry.

In addition to profit from the growth of coins, in 2021 the crypto revolution will make it possible to extract passive profit using staking, as well as liquidity mining, which have become very popular with investors.

Despite the fact that the year 2020 is considered by many to be a crisis year, it turned out to be one of the best years in history for the cryptocurrency market. A lot of new platforms have emerged and a real DeFi revolution has taken place.

All this will leave a huge mark this year, as the DeFi revolution is not slowing down, on the contrary, it is only getting stronger, which means that in 2021, making money on cryptocurrencies will become bigger and easier. Using Cryptology, you can easily buy and sell digital assets.

[cryptology-exchange]

Taxation of the crypto market: what everyone should know

Perhaps it is the fiscal potential of the cryptocurrency market that is the most powerful argument pushing states to take regulatory measures as quickly as possible.

Indeed, with a total capitalization of $ 300.00 billion as of the end of the first quarter of 2018, from all income earned by crypto entrepreneurs from mining and trading, only a few countries received profit in the form of tax payments to the budget.

How to pay tax on crypto income?

It should be noted right away that in almost all countries there is such a tax rule as personal income tax, and it does not determine the source of income from which the profit was obtained as the basis for taxation.

The starting point for paying income tax is directly in itself the profit received as a result of any economic and investment activity.

Therefore, in most of the court proceedings in which the fiscal authorities bring charges of tax evasion, it is this rule that serves as the basis for building a case.

Taxation of the crypto market in the US

Traders and miners — Americans who receive income from operations in the cryptocurrency market are required to declare an increase in capital to the IRS. Digital currencies are a medium of exchange or store of value that can be exchanged for fiat money. Consequently, transactions with virtual money are taxed. Otherwise, large fines or punishment may be imposed on citizens.

Foreign Accounts Report (FBAR). If US citizens have foreign accounts worth more than $ 10 thousand, it becomes necessary to fill out the FinCEN 114 form. A very broad concept of foreign accounts also includes savings in bitcoins.

Report on compliance with the Foreign Accounts Tax Compliance Act (FATCA). This type of reporting imposes obligations to deduct 30% tax from US citizens, foreign legal entities. The tax base is dividends, interest, or insurance received from foreign financial institutions. Foreign bank accounts in virtual currency and deposits on cryptocurrency non-US exchanges fall into this category.

Country Report (CbCR). Applicable to US multinational exchanges such as Coinbase with over $ 850 million in revenue. Form 8975 must contain information about bitcoin transactions for each country separately. The form also indicates the value of tangible assets. This item also includes digital currencies that are not recognized as money in the United States and qualify as property. Corporate penalties apply in the United States and 57 other countries.

Thus, the highly lucrative cryptocurrency business has attracted the attention of the regulatory tax authorities. The IRS received permission to audit all companies involved in the cryptocurrency business: exchanges, bitcoin wallets, hedge funds.

After all, one way or another, paying taxes for making a profit from any economic or investment activity is the responsibility of every resident and non-resident living under the jurisdiction of a particular country.

At the same time, it should be noted that at this stage, while cryptocurrency exchanges are not legally in the FATF zone, they are not tax agents. And, as a result, they do not report to the tax authorities information about the income of their clients.

Trade crypto profitably with Cryptology!

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Market order book and principles of order execution

What is a market order?

A market order is a buy or sell order that must be immediately executed by a broker. As soon as a buyer or a seller is found, the order is executed automatically.

It is important to understand that unlike limit orders, they are not placed in the order book, but are executed instantly.

In addition, this type of order cannot be canceled, unlike limit orders, which is also important to understand when you use them.

It is also important to remember that you are agreeing not only to the current market price but also to a price that may be slightly lower than the current one (this happens when there is not enough volume at the current price level to execute your order).

For example, when you send a market buy order, you will buy the selected asset until you have filled the entire volume of the order.

How does a market order work?

Suppose that you decide to create the same market order to buy 5 ETH for USDT, which is familiar to many.

To do this, you need to go to the appropriate tab on the exchange and complete a purchase order.

Due to the fact that these orders are executed automatically, your order will initially correspond to the cheapest limit sell order that is in the order book.

However, what if you want to become an Ethereum whale and buy 5000 ETH at the current market price?

For this, the cheapest orders will not be suitable, since they will not fill the entire volume of orders.

In this case, the following will happen: all exchange orders in a row will be executed, and you, as a market taker, will pay higher commissions, and the price for the cryptocurrency.

When should you use a market order?

In case the execution of the order is more important for you than the market price of the asset. You urgently need to sell or buy a certain asset, you are not afraid to overpay or lose a little. It is in this situation that market orders come to your aid.

To buy altcoins, we strongly recommend using USDT, because in this case, your commissions will be minimal relative to the commissions that you would have if you bought with LTC, ETH, or other coins.

And the most convenient way is to make such transactions on the Cryptology exchange, where you can trade with leverage up to x100 and withdraw funds with one of the lowest commissions on the market.

[cryptology-exchange]

Cryptocurrency market capitalization: top five cryptocoins

Cryptocurrencies have shown incredible growth over the past year. So, almost all coins were close to their historical maximum and, unlike the situation 3 years ago, today there is an excellent chance that they will all be fixed at this level for a long time.

The five largest coins in the cryptocurrency market are as follows:

◾️ Bitcoin ◾️ Ethereum ◾️ Ripple ◾️ Bitcoin Cash ◾️ Litecoin

How have coins grown in 2020 and what is the forecast for next year?

Let's start with No. 1. Bitcoin

In January 2020, the coin was worth approximately $ 7,100 per unit. In February, the currency rose to 10,000 USD, and later in March, it sank to 5,500 USD and then showed a rapid growth up to 19,600 USD and, after a slight correction, returns to its usual growth level. Buying a lot of BTC now is risky, but it is definitely worth keeping a part of the capital in it because some experts predict it will grow to 30,000 USD in 2021.

No. 2. Ethereum

It has been a great year for the Ethereum platform. It went through a major update, switched to Proof-of-Stake, and the price increased from 130 USD to 620 over the year and, after a slight correction, like BTC, is growing at an excellent pace, and the update only contributes to this.

Buying ETH today is a great investment, since the platform is not going to slow down the growth rate, and the DeFi market, where Ethereum is almost always the collateral, will only help it accelerate.

No. 3. Ripple

This is a real meme in the crypto industry. Its price is almost always below 1 USD, and it was only in 2017 that it broke through this ceiling. However, XRP has recently shown excellent growth from 0.2 USD to 0.7 USD. He is now experiencing a correction, but the outlook is generally disappointing.

Buying XRP is definitely risky and hardly a worthwhile investment.

No. 4. BitcoinCash

Originally created as a more technologically advanced fork of Bitcoin, it was going through hard times. However, now its price chart is similar to a roller coaster, while the price has increased slightly, from 210 USD to 289 USD.

Opinions about investing in BitcoinCash differ, someone does not advise considering it as an option for diversification, while someone sees potential in it and believes that this is a good investment for long-term investments.

No. 5. Litecoin

But the second Bitcoin fork was able to please its investors in a year. A doubling growth may not seem like something serious, but given the coin's schedule and stability, it, like BitcoinCash, performs well in the long term and is a great buy that can delight investors in 2021.

The best way to buy coins is from Cryptology crypto exchange!

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Gaps are the difference between quotes on different days. Usually, we are talking about the end of the trading day on Friday and the beginning of the trading day on Monday.

If this difference is significant, then a gap occurs.

Why do these situations arise?

Gaps occur when the market is inactive. A large number of orders are accumulating. As soon as the market opens, orders are executed and a gap is formed.

However, they do not always appear. Gaps are typical for situations where orders of one type significantly outweigh orders of another type (for example, buy orders are 60% more than sell orders). Usually, they try to close gaps as soon as possible.

So how to trade the gaps?

It seems to many that the best strategy is to trade towards the closing and that's it. Super-profits are guaranteed.

In fact, trading gaps is somewhat more difficult. First of all, not all currency pairs perform well during such situations.

Moreover, many people neglect stop-losses. This is one of the critical mistakes, because before closing the gap, the price often reverses in the opposite direction.

Important: to determine the most suitable currency pairs using technical analysis.

The trading algorithm is as follows:

Determine if there is a gap

Choose the best currency pair

Determine the first bullish and the first bearish candle

Enter a trade position quickly

Place stop losses

Start trading

Gaps are rare and occur at most once every several weeks, and sometimes even several months. However, they are a very good way to get extra profit.

Using the Cryptology exchange, you can easily trade at the gaps, and thanks to the large leverage, you can earn more than on other exchanges.