Hello dear Steemians,
Today's topic takes a look at CFDs (Contract for Difference), what is a contract for difference and why have we at Blockchain Nordic added it to our portfolio of services, are the questions I will provide an answer to in the latest edition of Jamie's Blog.
A lot happens in the blockchain field as many of you may already know, each week it seems like there is a new announcement ranging from large incorporations trying to develop it their own field, just look at Maersk, American Express & JP Morgan Chase & Co as an example.
But it's not only the large companies that are adapting to blockchain and cryptocurrencies, just the other day the bouldering club I attend started accepting cryptocurrency as payment. On top of that last time I was in Copenhagen I walked past a pub accepting Bitcoin as payment too. So we are starting to see a lot of different establishments adapting to blockchain and digital assets.
And if you look at the industry now, it is changing, at the end of 2017 through to the first quarter of 2018 the buzz around ICO's (Initial Coin Offerings) was peaking. Fast forward a year later and it's STO's (Security Token Offerings) that are making a name for themselves.
Not to mention the new protocol consensus algorithms created by various blockchain projects when at first Bitcoins' PoW (Proof of Work) was the talk of the town, then Ethereums PoS (Proof of Stake) and now we have DPoS (Delegated Proof of Stake), LFT (Loop Fault Tolerance) and so on, you get the idea, there's a lot happening within the industry, and I've not even mentioned what we read in the mainstream news.
But back on track, we're talking about CFDs and all I wanted to say was that, much like a blockchain, we here at Blockchain Nordic are adapting to the environment by adding CFDs to our existing services. And if you are wondering what a CFD is, don't fret, just read on.
What is CFD?
Contract for Difference is a trading method which enables the client and broker to enter a contract between each other for investing in a certain stock, asset, index or currency. The two parties agree to replicate market conditions and settle the difference, hence its name Contract for Difference. Settling the difference means in the event of a loss in investment the trader needs only pay the broker the difference of the loss.
How do you make a CFD trade with Blockchain Nordic?
If you, as a potential client, is interested in investing in a certain asset and decide to contact Blockchain Nordic regarding a CFD trade you will be put in contact with one of our Digital Asset Advisors and if the asset is available for Blockchain Nordic to make a CFD then the first step is completed thereafter the following steps will occur:
The Advisor (broker) will open up the position and sets the parameters agreed upon by both parties. Parameters are the certain requirements the client wishes, such as setting up a Stop Loss or Take Profit barrier, the amount the client wishes to invest, is it a long or short position etcetera.
Both parties then engage in a contract and agree upon an opening price for the position. It could be for example; A long position starting when Bitcoin hits $3,554, the position then becomes active once this requirement is met.
Once the position is active it is up to the client when they wish to close it unless a Stop Loss or Take Profit has been agreed or the contract has reached its expiration.
If the position closes in profit, the Advisor pays the client. If it closes, then the client only pays for the difference.
Thats all from me this week, hope you enjoyed the read.
Until next time.
- Jamie
Blockchain Nordic is a digital asset investment firm, where you can buy, sell and manage your digital assets such as Bitcoin, XRP, Ethereum and many more. We offer a direct gateway with an easy to use platform to support your needs. You can invest directly with your credit card into these assets safely and easily. Register for free today at http://account.blockchainnordic.dk