Spot vs. Futures Trading: Which is Better for Bitcoin?
In Bitcoin trading, spot trading is great for buying Bitcoin at a low price. If the price rises, your holdings increase in value. For example, buying Bitcoin at $20,000 and selling at $30,000 gives you a $10,000 gain.
Futures trading uses contracts to speculate on Bitcoin’s future price, often with leverage. If Bitcoin moves from $20,000 to $30,000, your potential profits (or losses) are bigger due to leverage.
Key takeaway:
Spot: Best for long-term gains when the price is low.
Futures: More suited for short-term speculations with higher risk and reward.
