Are you interested in trading Bitcoin but cannot because of the high price? Fear not because there is already a much more affordable alternative in the market.
Cryptocurrency is becoming more popular nowadays and a lot of people have been genuinely interested in taking part in this craze. Many believe that digital currencies are going to replace physical currencies in the near future and, so, they have chosen to turn their sights to cryptocurrency such as Bitcoin.
Bitcoin is the first and the most popular cryptocurrency and served as the catalyst for other cryptocurrencies to be introduced to the market. Because of the extreme volatility of this asset, Bitcoin has seen a dramatic rise in its price during the past months. This begs the question: is it worth trading Bitcoin despite the high price? What if I want to but I can’t afford it?
WHAT IS MICRO BITCOIN?
A Micro Bitcoin (MBT) is the smaller version of the standard Bitcoin at 1/10th of its size and 1/50th of a standard Bitcoin futures contract. It was launched by the Chicago Mercantile Exchange (CME) to allow small traders and investors to buy and trade the contracts. The MBT has the same features as the standard BTC futures contract and has key benefits such as:
- It has a smaller capital requirement (1/10th of one bitcoin and 1/50th of a bitcoin futures contract).
- It is traded on a regulated exchange managed by the U.S. Commodity Futures Trading Commission (CFTC).
- It provides an efficient and cost-effective way to fine-tune bitcoin exposure, manage bitcoin price risk, and enhance trading strategies.
- There is price discovery and transparency, letting market participants see the same prices.
- There is an increase in flexibility since traders have the ability to go long or short without any restrictions.
Also, the minimum price fluctuation or tick of an MBT is $0.50. MBT futures contracts are listed for six consecutive monthly contracts, inclusive of the nearest two December contracts. This gives traders more flexibility in setting time frames with their price expectations.
WHERE CAN I BUY BITCOIN FUTURES?
Now that you have an idea of what Bitcoin futures contracts are, next is finding a good platform to trade them. There are already many platforms available that support BTC futures contracts. You can buy BTC futures in well-regulated crypto exchanges, but you can also buy on unregulated broker platforms.
The Chicago Mercantile Exchange (CME) is one of the largest and most regulated financial derivatives exchanges which offer bitcoin futures contracts. It is also one of the most trusted institutions so you know you are well-protected. The minimum investment in this platform is 1 contract unit equivalent to 5 BTC.
Other platforms that offer to trade BTC futures contracts are:
- Kraken. It is another safe regulated crypto exchange with its robust crypto futures section. One BTC futures contract in this platform is equivalent to 1 USD and it requires a minimum deposit of 20 USD.
- TD Ameritrade.
- Bakkt. This platform was created specifically for BTC futures and is owned by the Intercontinental Exchange (ICE), the same company that owns the New York Stock Exchange (NYSE). In this platform, traders settle on actual Bitcoin, unlike its competitors which only use fiat currency.
- ETrade. ETrade is another leading trading platform that started offering derivatives such as the CME BTC futures product.
- BitMEX. BitMEX is one of the biggest unregulated cryptocurrency trading platforms wherein traders can access Bitcoin futures products. It offers 100x leverage which is much higher than other trading platforms. However, this is not available for citizens and residents of the U.S.A.
- Deribit. Deribit is another unregulated cryptocurrency trading platform based in the Netherlands that offers Bitcoin futures.
- Binance. Binance Exchange is another popular cryptocurrency trading platform wherein traders can also access Bitcoin futures. It provides the highest leverage among other trading platforms at 125x
Is It Wise To Buy Crypto?
Although the cryptocurrency market is becoming more popular nowadays, some people are still doubting if it would make a good investment. No one could blame them because the price fluctuations of Bitcoin have seen dramatic highs and lows. However, this should not stop you from buying Bitcoin especially if you are buying futures contracts since they are less risky than buying the standard Bitcoin.
Bitcoin’s are not regulated but its futures contracts are traded in a regulated exchange, meaning traders and investors are protected from uncertainty and huge losses.
What Time Does CME Bitcoin Futures Open?
One of the reasons why trading BTC futures is because it can be traded almost 24/7. Trading for Bitcoin futures contracts at CME opens at 6:00 pm and closes at 5:00 pm from Sunday to Friday. There is also a one-hour break each day starting from 5:00 pm.
WHERE CAN I FIND CHARTS OF MICRO BITCOIN FUTURES?
Whether you are holding Miro Bitcoin as a long-term investment or just for trading, one of the most important tools that you are going to need is a chart. A chart allows you to see the volume or the supply and demand of Bitcoin in the market and analyzing it is a skill that every trader should master. Once you get the grasp of reading charts, you would understand how the market works and you will be able to tailor your strategy to make the most out of the market.
Micro Bitcoin futures charts can be found in any trading platform that also offers can cryptocurrency derivatives. It is highly recommended to use charting platforms that are easy to use and have features that will help in improving your trading journey.
Micro Bitcoin Futures Interactive Brokers
If you are an experienced trader, most likely you have heard of the popular trading platform, Interactive Brokers. It is a trading platform that has advanced features that cater mostly to traders who have been in the industry for a while. Interactive Brokers also offers CME Bitcoin futures contracts and has the lowest margin requirement of 50%. However, the minimum deposit requirement is $10,000.
Micro Bitcoin Futures Ninjatrader
NinjaTrader is another trading platform that also offers CME BTC futures products. This platform is more user-friendly and has a lower minimum deposit requirement of $400. Aside from being more suitable for beginners, NinjaTrader is packed with features such as advanced charting, backtesting, low margins, and low commissions.
WHERE CAN I FIND THE PRICE FOR MICRO BITCOIN?
Prices for Micro Bitcoin futures can also be found in various charting platforms. It can be viewed in real-time and you can also see its historical data that might be beneficial to your trading. Charting platforms also have the option to display prices in different time frames so you can have an idea of the behavior of MBT during certain times.
CME Bitcoin Futures Price
As mentioned earlier, the Micro Bitcoin futures contract is 1/10th of the size of one Bitcoin and 1/50th of the size of a standard Bitcoin futures contract. The daily price settlement for MBT is determined by the CME CF Bitcoin Reference Rate (BRR) as of 4:00 pm London time. MBT futures are subjected to price limits on a dynamic basis. The price limit is equal to a percentage from the prior day’s settlement price or whatever price the CME considers appropriate. This is to establish lower and upper price fluctuations limits in order for the traders to see the actual behavior of the MBT in the market.
CME Bitcoin Chart
You can access and study CME BTC charts on the official website of the CME or you can just view them on other trading platforms that offer the futures product. These platforms already contain price changes and other analytics that might be essential for your trading plan.
Micro Bitcoin Futures Symbol
The CME has assigned MBT as the product code for Micro Bitcoin futures for CME Globex, CME Clearport, and Clearing.
HOW DO YOU MINE MICROBITCOINS?
Before we go into the process of mining, we have to define what it is. Cryptocurrency mining or in this case, Bitcoin mining, is basically the process of discovering new blocks that will be added to the chain and verify if the transactions are legitimate. This is called
“proof-of-work”. Miners find a solution to math equations that validate whether the hash in one block is less than or equal to a target hash and if that block did come right after the previous block. For every successful mine, you will be rewarded Bitcoins.
In order to mine, you will first need a Bitcoin wallet wherein any of your earnings will be put into. Second, you need to have powerful computer equipment like a GPU (graphics processing unit) rig. You need to have a dedicated machine just for mining to get the best results. ‘Lastly, mining software is needed to start your tasks.
Now that you have the basic requirements, the next step is choosing a mining pool. A mining pool is a group of Bitcoin miners who work together to get great and successful results. Getting into a group has a higher chance of yielding results than doing the work by yourself. There are various mining pools but it is recommended to join a large one as this has better chances of becoming profitable. Of course, factors such as minimum payout, pool fees, and other parameters should be considered when choosing a pool.
If you cannot afford to buy Bitcoin through the various exchanges, then Bitcoin mining might be a good alternative. It can be profitable as long as it is done under the right conditions. Ultimately, it will depend on the hardware you will use. The faster the hardware, the better faster you can get to discover and verify blocks.
Bitcoin mining is one way of securing the integrity of the blockchain network but there are also risks involved. One risk is not getting any return on investment after spending a lot of money on expensive hardware. Not every day can mining be profitable, but joining mining pools can lessen the chances of that happening. Another risk is of legal reasons. While Bitcoin is perfectly legal in most countries, there are other places where it is prohibited to do and also illegal to own Bitcoin. So before you get into Bitcoin mining, you should check your country’s rules and regulations regarding Bitcoin and mining.