Block Trades – Everything You Must Know

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Block trades are defined as the bigger trades between two opposing parties having a fixed price. When it comes down to our conventional stock exchanges, the block trades tend to have over 10,000 shares, but it isn’t limited to the equities. This is because the cryptocurrency traders also opt for block trades for purchasing the higher amount of Bitcoin or offload. However, the mechanics are pretty the same, whether you opt for block trades in crypto or at a stock exchange.

So, if you are ready to have some huge coins in your crypto wallet, let’s start with the pros and cons and everything else you need to know about block trades!

Pros Of Block Trades

To begin with, block trades have become a convenient way of selling and purchasing the higher amount of these virtual coins. However, they aren’t very good for trading. To help you out, we are sharing the pros, so you can see if it’s the right option for you or not.

Reduced Slippage

When it comes down to making bigger transactions on the crypto market, there are higher chances and potential of witnessing slippage. For instance, if you set the selling order at $10 but only limited buyers are matching the order, it will result in slipping of value in the trade, and the selling price will be set to an even lower price. However, block trades take away this headache by optimizing the value.

No Fees

Have you ever seen a crypto trader who would be happy to pay the commission fees on crypto exchanges? We don’t think so, particularly when they are just starting to make some profits. However, with the help of peer-to-peer crypto exchanges, you will be able to make huge trades and transactions without worrying about the fees.

Preference

When you start trading through the peer-to-peer crypto exchanges, the crypto holders and investors have the choice of trading on their terms. The traders can trade with the local currency and choose the most preferred payment method. Fortunately, these crypto exchanges often have hundreds of local currencies and payment methods to support the block trades.

Cons Of Block Trades

Well, nothing is always rainbows and unicorns, and the same goes for block trades. There are some downsides of block trades that we need to consider before making it a way of trading crypto coins. So, let’s have a look at the cons of block trades.

Security

The first and the biggest downside of a block trade is the security, mainly because of the peer-to-peer nature of these trades. It is essential to select the experienced and trusted block trading merchant because getting hooked on fraudulent exchanges and scams is the last thing you want. For this reason, it’s important to look for a crypto exchange with user security to ensure the merchants are vetted.

Capital Issues

Another factor to consider is the tie-up of capitals because you don’t want to end up in a specific market movement while you are completing the block trade. For instance, if you have agreed to the fixed price and the market moves, your funds will be tied up. In such cases, talking to customer support helps keep things smooth, while leading to quick and smooth transactions, so find one.

Going Ahead With Block Trade

Now that you have weighed the pros and cons of opting for block trades, there are various ways to go ahead but make sure you have $50,000 in the wallet because that’s a requirement. So, in the section below, we are sharing some options:

  • Block trade zone – the cryptocurrency exchanges with peer-to-peer configuration are designed with multiple trading zones on their smartphone apps, so you can use them to check out the available block trades in the local currency and put in your money
  • Search filter – if the exchange doesn’t have the block trade zone ads, you can opt for the search filters. This way, you will be able to allow only verified ads to pop up on the homepage. In fact, you will be able to filter through how much currency how you have and the preferred payment method

The Bottom Line

The bottom line is that block trades are actually one of the most promising ways of earning profits and reducing risks while investing in an expensive cryptocurrency. You must not undermine the importance of using the right exchange, and we do think that the benefits of investing in cryptocurrencies is a nice one!

 

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