I'm assuming volatility? It hardly ever stops moving and, for something with such a big market cap, it moves a heck of a lot. I suppose ETH, or other cryptos, may be even be better in this respect? Is there anything else (stock, commodity?) which has similar volatility characteristics? constantly on the move moves a lot percentage wise (without having to use leverage) I'm guessing the problem with trading highly volatile stocks is they would mostly be smallcap/micro/penny with the inherent risk of getting caught out by massive gaps?
What makes BTC good for day trading? this question cannot be answered ---> What makes BTC Futures horrific for day trading? - Volume is very low - only 6k / day for BTC futures and around 5K / day for micro BTC futures - horrific bid-offer spread easily > 20 ticks There are other better, and volatile futures to trade like - crude oil volume > 100K / day day range easily 4% bid-offer spread just 1 to 2 ticks - European or US Natural gas - some index futures eg NQ volume 800k/day micro NQ volume 1.4M / day Ave day range 2.5% for goodness sake, use leverage so that you put very little money in your trading account. and if a crypto lender /broker ... goes bankrupt, you lose very little money.
BTC is good for trading because your counterparties tilt heavily towards the most unsophisticated, low-information retail muppets and diamond hands HODLers - some of whom nonetheless have account sizes in the billions.
Which (if you subscribe at all to the EMH) should make it less efficient, less random walk. In other words, easier to extract a profit from.
- Futures and options are very liquid (crypto native derivatives, not the useless trash on the CME) - banking (borrowing/lending) is accessible for retail meaning you can lend your own holdings and receive interest - the entire ecosystem is a meme stock on steroids 24/7/365 so there is always opportunity. - It's one of the last free markets so despite the fact that it is very volatile crypto has less tail moves than traditional assets since it's not manipulated by central banks and also not prone to be stuck in a passive vehicle correlation dump Let me elaborate on the last point a bit since it's probably hard to grasp for some: You can have a stock that trades with an annualized volatility of 13%. It's part of 1000s of ETFs, indices and retail investment products. Now one issuer is in trouble and has to liquidate it's entire book -> stock is sold -> other issuers also have to rebalance since the stock is down and sell stock, which leads to a gigantic downward spiral out of nowhere which is called a tail event. That doesn't happen in crypto. There is no such thing as a blue chip that grinds up and down a couple of cents per day then suddenly goes to zero. The market is always on fire. Volatility that has been induced by the LUNA/Celsius/3AC events is considered normal. Also, stuff that does not work out will go to zero and it will go to zero fast. If you spot a bullshit project, you can short it without the risk of getting run over by a government rescue bid for some weird political reasons.
Which is not surprising because it's almost become like a Bitcoin ETF. Crypto mining stocks like GLXY and MARA also act like proxies.
There are no ifs about it. The entire basis of PFOF is that you (Citadel etc) are paying for access to retail i.e. dumb-money order flow. In Bitcoin, there's no need to pay for the privilege - except insofar as tying up capital anywhere in the crypto ecosystem incurs a "fee" in the form of material counterparty risk.
That's only part of it. But if volatility is what you want, there are many equities that are an order of magnitude higher still. It's the combination of both volatility and liquidity.
HONG KONG: Hodlnaut, a Singapore-based crypto currency lender and borrower, has suspended withdrawals, swaps and deposits, the company said on Monday (Aug 8), the latest sign of stress in the cryptocurrency industry. ____________________________________________________________ Who will be next?