Did you know that you can trade Ethereum through CFDs.  CFDs (contract for difference) are an investment product that allows you to trade on the price of an underlying asset without needing to take ownership of it.  I’ve put together this post to explain a bit more about Ethereum CFDs and how you can make money trading them.

Advantages of Ethereum CFDs

CFDs have been around for a long time.  But we’re only just starting to see brokers offer CFDs for Cryptocurrency.  That’s understandable – they needed to make sure there was enough liquidity to support the higher trading volumes they would bring to the markets.  The good news is, that it’s now really easy to trade Ethereum CFDs.

Here are some of the advantages of trading Ethereum via a CFD:

  • Speed – CFD trading is instant.  You don’t need to wait for orders to be filled or wait for the Ethereum network to send you actual Ethereum.  Because you’re trading a contract, the process is instant.  And good brokers will ensure that your trade is executed instantly at the price you want.
  • Buy or Sell – CFDs allow you to profit from the movement of the price.  This means you can profit whether the price goes up or down.  If you’re bearish on Ethereum, you would open a “sell” or “short” order.  And this contract would profit you when the price of Ethereum drops.  And of course you’d do the opposite if you are bullish.
  • Fiat Currency – You trade Ethereum CFDs using regular fiat currency.  This means you don’t need to first exchange into Bitcoin to start trading.  Of course there are brokers that only accept Bitcoin so if you do want to trade using Crypto you can.
  • Leverage – leverage allows you to control a larger position.  This potential increases your profits.  On the flip side it can increase your losses.  Leverage is a powerful tool and used correctly can allow you to make massive profits on small price movements.  Just be careful!  It’s an advanced trading tool.
  • Trade alongside traditional assets –  This is what I love about CFD trading Ethereum.  I can trade it while also trading stocks and forex, all in the one interface.

Where to Trade Ethereum CFDs

More and more brokers are supporting Ethereum and other crypto CFDs.  Here are my favorites – all of which I’ve used (with a real money account):

eToro – My broker of choice.  Mainly because they have a great interface and also support CopyTrading.  This means I can copy the trades of profitable crypto traders automatically!  They support a number of cryptocurrencies including Ethereum.

Whaleclub – If you want to trade using Bitcoin (or Dash), as the base currency, then I would recommend Whaleclub.  They have a pretty good interface that is all web based.  And the deposit and withdrawal process is fast!   The fees are higher than on eToro, but it’s still possible to make decent returns.

Alternative to Trading CFDs

The alternative to trading CFDs is by buying Ethereum directly, through something like Coinbase and then trading it on an exchange such as Poloniex.  This can obviously still be profitable, but it does add a few complexities to the process (including fees).

Should you trade Ethereum?

Ethereum is certainly in for a bumpy ride over the next few years.  But it’s got a solid tech roadmap ahead of it, and is powerful as a currency and as a platform.  So there is plenty of potential.  I have no idea where the price of Ethereum is heading, but I do know there will be plenty of volatility.  And volatility is perfect for CFD trading.  All i know is there are plenty of profit opportunities to be had.