Why should crypto demo accounts be more heavily regulated
Why should crypto demo accounts be more heavily regulated
Crypto

Why should crypto demo accounts be more heavily regulated

By Giorgi Mikhelidze - 16 Aug 2020

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Demo accounts are one of the biggest parts of forex and crypto trading around the world. They have been around for a long time now and these types of accounts make sure that traders have the ability to sit back, relax, and trade without risking their own money while having the ability to learn more about the forex trading and their skills in this market. 

Many people have this misconception that demo accounts are created for beginners only, while in reality, even the most experienced forex traders can learn something out of it. Generally, it is used by traders to test their trading skills, come up with new strategies, and learn more about forex trading

Every broker has its own demo account and they are different from one another. But in most cases, trading Forex with a demo account is very much like doing so with a live account. The only difference is that you are not risking your own real-life funds, with demo accounts, you are trading using virtual cash that was provided by the forex broker. Because of this, many use demo accounts as a way to test out the offerings of a certain broker

Why are crypto demo accounts so popular? 

Previously, demo accounts have become more popular than ever before. There are many forex brokers that offer a demo account, and these brokers are giving traders the ability to trade freely, which can lead to a lot of benefits for traders. 

The biggest advantage of a demo account is the fact that anyone can use it. For beginners, it is a great way to learn more about Forex trading and get comfortable doing it, and for experienced FX traders, it is a perfect solution to test their trading skills and strategies and come up with new ones if they think that it does not work for them, without risking huge amounts of hard-earned money. 

Cryptocurrencies – what are these and why are they so popular? 

Crypto is a digital asset that was designed to work as a medium of exchange between individuals. Crypto are using decentralized technologies to let users make secure payments, and one of the biggest parts of its popularity is the fact that you can be holding a lot of crypto without anyone around you knowing about it.

Crypto demo accounts – what are they? 

Crypto trading has become increasingly popular over the years. There are many forex brokers who are using crypto-only, and their popularity is rising every day. However, regulating crypto is a huge challenge, and when it comes to crypto brokers, it is becoming even harder. 

Over the years, crypto has become one of the most attractive choices when it comes to investments in the world of forex. The fact that they are called the investment of the decade is not for the wrong reason, it happens because crypto is developing at a very fast pace, and since it is a decentralized currency, many people are drawn to it.

To give the people who want to try out crypto trading on their own, FX brokers are making sure to include demo account opportunities to their users. This has become a very popular practice over the last few years, and because trading with crypto is so risky, many people are starting it using demo accounts. 

However, this does not mean that trading with demo crypto accounts does not involve any dangers. Because of the fact that your hard-earned money is not involved in this process, you will have a very hard time coming to terms with the fact that you have to know how to control your emotions. 

In many cases, people using demo accounts are not emotional about losing investments at all, which can make the experience a little different from the experienced traders would have if they traded with their real-life funds. 

Once you have traded for a very long time with crypto demo accounts, it has been proved by many experts that it will become a little hard for you to adjust with the real-life world of trading, where you are actually trading your hard-earned money. 

What are regulations and why are they so important? 

With the development of the internet, forex trading got a great chance of creating a huge online following which would result in the huge popularity of the field. However, with this opportunity, scammers also came. These scam companies are working very hard to lie to people and get their money illegally. 

To overcome this challenge and ensure the safety of traders, many countries have created regulatory agencies that would look after the field of forex. With regulations, many countries managed to create a safe and secure environment, but there still are a lot of challenges. 

One of the challenges that the forex market faces today is the fact that crypto demo accounts are not regulated as good as they should be. In reality, it is very easy to use these types of accounts, some FX brokers do not even require registration, you can just go there and trade with the demo account without any restrictions. 

As good as this can be, it can also lead to many problems for both traders and brokers. For traders, if they trade a lot with crypto demo accounts, they might not be able to learn how to work on their nerves when they start trading with real-life funds. This can lead to huge problems and if your nerves get in the way and you will not be able to make the right choices, everything can end with a lot of problems. 

Why should anyone use demo crypto accounts? 

Although there are some risks associated with trading with crypto demo accounts, people who use these demo accounts have the ability to enjoy a number of benefits. First of all, if you are ever wondering if a certain broker is a scam or not, you can use their demo account to check out the trading platform and the opportunities that you have with the broker. 

It is a great opportunity because you are taking huge steps towards safety while using demo accounts. However, you should never forget that you need to learn how to trade with your emotions at its highest level. Forex trading is very risky, and if you do not understand these risks well enough, it could lead to a lot of problems. 

In the end, crypto demo accounts are not regulated well enough and they have the potential to teach traders wrong lessons, and in the world of forex, you need to be 100% certain about something until you do it.

Giorgi Mikhelidze
Giorgi Mikhelidze

Giorgi is a Georgia software developer with two years of experience trading on the financial markets. He is now working to spread the knowledge about the Blockchain in his country and share all of his findings and research to as many crypto enthusiasts as possible.

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