Even though its name is not well-known, Dash is one of the most highly capitalized cryptocurrencies on the market. Although it is at a level that is much lower than the crypto giants like Bitcoin and Ethereum, Dash has some interesting features that we would definitely like to discuss in this article. In addition to providing an introduction to this specific cryptocurrency, we will also explain how you can trade with Dash online for profit through the trading platforms provided by CFD brokers.
What is Dash?
Dash is similar to Bitcoin in all respects but with “improvements” although progress should be seen more on facts than on paper. Anyway, it’s a very interesting cryptocurrency which is getting more and more popular all over the world.
There are three points that Dash is aiming for:
- Instant transactions: with Dash, you can make instant payments using InstantSend that works even when using your mobile phone
- Privacy: Dash protects the financial information of its users. PrivateSend (its platform), ensures the privacy of your history and budget.
- Security: transactions are confirmed by a system with the computational power of 1000 Gigahash x11 ASICs and more than 4000 servers located worldwide
At the heart of the Dash project is a peer-to-peer network where miners are rewarded for securing the blockchain chain and masternodes are rewarded for validation, archiving and other blockchain-related services.
Masternodes represent a new type of network server working in highly secure clusters called quorums in order to provide various decentralized services such as instant transactions, privacy, and governance while eliminating the danger of low-cost network attacks.
If you want to find a Dash defect that explains why it does not appear among the very first cryptocurrencies in terms of capitalization, it is precisely because it provides the same services as Bitcoin or at least the both of them are very similar. Other cryptocurrencies, such as Ethereum and Ripple, on the other hand, are intended for specific purposes and users who do not, therefore, enter totally into conflict with Bitcoin (and therefore compete for new users). Among the new goals of the Dash team is to make Dash easier to use for all types of users.
Trading with Dash
Regardless of your interest in using Dash as a cryptocurrency or payment method, you should consider trading with Dash online in order to obtain an economic result based on changes in its market prices.
As for the other cryptocurrencies as well as for Dash, there is a counter value in dollars on type of transaction that you choose from.
Below, we offer brief but quite comprehensive information about the tools to trade with Dash through CFDs.
What are Dash CFDs?
A Contract for Difference or CFD is a particular financial instrument that is characterized by replicating the performance of an asset, which is represented by another financial instrument. For example, in the case of Dash CFDs, the CFD is the financial instrument that replicates the market performance of Dash (the asset, also called the underlying asset).
Now, be careful because when you trade with CFD Dash (click here to start using Plus500) you do not buy Dash. What you actually do is to trade up and down on securities that replicate its performance (quote).
In fact, by opening a trading position on CFD Dash, you are not buying Dash, but rather, you are just trading with a quote.
But what does it mean to open a trading position?
Opening a trading position means buying Long or Short CFDs in order to profit from increases or decreases.
- Opening a Long or Buying trading position means aiming for positive economic results in proportion to the rise in the price of the asset that occurs between the opening of the buying position and its closure.
- Opening a Shot or Sell trading position means aiming for positive economic results in proportion to the fall in the price of the asset that occurs between the opening of the selling position and its closure.
So is it a bit complicated? Let’s simplify with an example!
Let’s pretend we’ve done some analysis or read a good, convincing article about a Dash forecast. These forecasts were upwards.
Considering the forecasts, we open a Buying position, that is, upwards. If these forecasts turn out to be correct, we will obtain a profit proportional to the upward changes produced from the moment the position is opened. If, on the other hand, these forecasts prove to be wrong, we will suffer a loss proportional to the upward changes produced from the moment the position is opened.
How to trade with Dash on Plus500
The first way to trade with Dash is Plus500, a platform provided by the homonymous broker Plus500, which allows you to trade with different cryptocurrencies like Dash.
One of the best qualities of the Plus500 platform is its clarity. Added to this is the ability to practice through a free demo without the need to make deposits. The demo practice mode is always available even if you decide to open a real account to trade with real money (optional).
As we have seen before, with CFDs you can operate upwards or downwards by opening Buy or Sell positions. To open a purchase or sale position with Dash on Plus500, you start by selecting Dash from the Crypto category (which is displayed in the left column as shown in the figure).
Clicking Cryptocurrencies also displays the list of Cryptocurrencies in the main box on the right. As you can see, on the same line as Dash in the main pane appear the “Sell” or “Buy” buttons with which you can open an up or down position based on your price forecast.
Once you have clicked the Buy or Sell buttons, you can easily set the details of the position to be opened.
Let’s analyze the details that can be modified by the user:
- The amount of Dash to trade: in this box, you can directly enter a quote of your choice or use the + and – keys. In addition to the amount, you will always see the amount of margin required (explanation below)
- Margin required: is the actual amount of capital that the trader uses in the transaction. In fact, it should be noted that CFDs are instruments subject to the mechanism of leverage, which allows the user to use very small amounts of money compared to those required for traditional investment. In the case of trading with Dash on Plus500, the leverage is equal to 1:10, so with €100 of initial margin, you can trade a total value of €1000 of Dash.
- Stop Loss: by setting the stop loss (by ticking the box and defining a percentage) the platform is ordered to automatically close the position if the transaction reaches a certain level of loss percentage. Important: We recommend that you always set it.
- Stop Limit: works in the same way as stop loss but on the contrary, it allows you to set the desired profit level and automatically close the position once you have reached the desired amount, thus “saving” the profit.
- Operating stop: allows you to order the platform to automatically update the level of stop loss in the event that the market moves in favor of your prediction. This type of order can be accessed by clicking “advanced”.
- Buy only when the rate is: is an order that is very useful in two cases. The first case is when you wish to “enter” the market only when the price reaches a certain level. The second case is when you want to place an order for the next trading day. In the case when the box relative to such an order already appears ticked and not modifiable, it means that the market is momentarily closed and that you cannot do anything else aside from issuing a purchase (or sale) order.
Once you have finished setting the orders, to open a position, just click the “Buy” or “Sell” button. Once the position has been opened, it will immediately start to affect the available capital.
A small but important detail:
Once the position is opened, the profit/loss count (prof/per) will always start in the negative value. This is absolutely normal because when the position is opened, the broker retains a percentage of the spread or the small amount that the broker retains as compensation for the service of providing CFDs.
When the position is closed, however, it no longer has any effect on the available capital. At the close of the trading position, the maintenance margin is returned to the user, as well as the initial net margin of profits and losses.
Dash on IQ Option (CFD)
IQ Option has also introduced itself into the CFD industry and therefore allows you to trade up or down with this cryptocurrency.
How does the IQ Option’s CFD Dash differ from the others?
The main difference between IQ Option’s CFD Dash and Plus500’s CFD Dash is that in the CFD Dash offered by IQ Option provides no leverage.
Let’s move on to practice.
To trade with Dash on IQ Option, you can start by clicking the “+” button at the top. This will open the list of cryptocurrencies from which you can easily select Dash.
After selecting Dash, you proceed by setting the amount to invest ion n the transaction on the right of the display. Finally, just click “buy” or “sell”.
Depending on your forecasts and market analysis and within the limits of the IQ Option conditions, you can close your trading position whenever you wish. By closing the position, you can recover the amount based on the new exchange rate between dollars (USD) and Dash for the CFDs.