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Your guide to trading Qtum (QTUM)

Capital.com's guide to trading Qtum (QTUM): Everything you need to know on how to trade Qtum. No commission. FCA and CySEC regulated.
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Why is Qtum important to traders?

Qtum is the native cryptocurrency of the Qtum platform. Thi is an open-source decentralised project that aims to combine the success of cryptocurrencies such as Bitcoin with those such as Ethereum. This Chinese hybrid platform allows developers to build decentralised applications and Ethereum-based smart contracts on the current blockchain technology. The result is a platform that helps companies create smart contracts on blockchain. It is a cryptocurrency, that eventually, could compete with both Bitcoin and Ethereum. Qtum’s end goal is to become the first Value Transfer Protocol (VTP). Qtum is one of the top thirty biggest cryptocurrencies in terms of market capitalisation.

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Qtum trading hours

You can trade Qtum CFDs on Capital.com 24/7.

How to trade Qtum CFDs

An individual has two options when trading in the cryptocurrency market. Firstly, they can buy actual cryptocurrency on exchanges, such as buying Qtum on an exchange like EXX, so they own the Qtum themselves. This is considered a long-term investment, as the individual is waiting for the price to rise significantly, so they can sell their crypto coins on an exchange. Alternatively, they can trade a contract for difference (CFD) on a particular cryptocurrency, and speculate on the price difference.  A CFD is a financial instrument, which is a contract, typically between a broker and an investor, where one party agrees to pay the other the difference in the value of a security, between the opening and closing of the trade. You can either hold a long position (speculating that the price will rise) or a short position (speculating that the price will fall). This is considered a short-term investment as CFDs are used within shorter timeframes. For instance, to trade Qtum CFDs, you can speculate on the QTUM/USD pairing.
 
There are pivotal differences between buying a cryptocurrency and trading a CFD in a crypto market. When buying cryptocurrency, it is stored in a wallet, but when trading CFDs the product is stored in your account, which is regulated by a financial authority. You are more liquid when you purchase CFDs because you are not tied to the asset, you have merely purchased the underlying contract. As well as this CFDs are a more established and regulated financial product.

What is Qtum? What is cryptocurrency?

Qtum is a hybrid platform that allows developers to build decentralised applications and smart contracts on the current blockchain technology. Cryptocurrencies can be split into either: utility tokens; providing access to the services provided by a particular project, security tokens; something representing an underlying asset, or a payment token (like bitcoin). A cryptocurrency is a digital asset conceived for use as a medium of exchange, which uses cryptography to secure transactions, control the supply of additional units, and corroborate transfers. In short, cryptocurrency is a decentralised electronic currency. Cryptocurrency is stored in a ‘wallet’, which can take various forms. For instance, Litecoin can be stored in an online wallet, or alternatively in an offline electronic wallet, and it can even be stored physically in hardware.

Why trade Qtum CFDs with Capital.com

Advanced AI technology at its core: A Facebook-like News Feed provides users with personalised and unique content depending on their preferences. If a trader makes decisions based on biases, the innovative News Feed offers a range of materials to put him back on the right track. The neural network analyses in-app behaviour and recommends videos, articles, news to polish your investment strategy.

Trading on margin: Providing trading on margin (up to 2:1 for cryptocurrencies), Capital.com gives you access to the cryptocurrency market with the help of CFDs.

Trading the difference: When trading a Qtum CFD, you don’t buy the underlying asset itself, meaning you are not tied to it. You only speculate on the rise or fall of the Qtum price. CFD trading is nothing different from traditional trading in terms of strategies. A CFD investor can go short or long, set stop and limit losses and apply trading scenarios that align with his or her objectives.

All-round trading analysis: The browser-based platform allows traders to shape their own market analysis and forecasts with sleek technical indicators. Capital.com provides live market updates and various chart formats, available on desktop, iOS, and Android.

Focus on safety: Captal.com puts a special emphasis on safety. Licensed by the FCA and CySEC, it complies with all regulations and ensures that its clients’ data security comes first. The company allows to withdraw money 24/7 and keeps traders’ funds across segregated bank accounts.

History of Qtum

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In March 2017, Qtum launched their Initial Coin Offering (ICO) in an attempt to crowdfund the development of their new blockchain-based platform. Qtum sold over $10 million worth of it’s tokens just 90 minutes after launching. The crowdfund campaign was supposed to last 30 days, or until all the tokens were sold; which occurred a mere five days after the ICO. Qtum raised a total amount of approximately 11,100 bitcoins (BTC) and 77,000 ethereum (ETH), this was around $15.6 million in value, in exchange for 51 million Qtum tokens being distributed to the public. 51% of the Qtum coins were distributed to the public through the crowdfunding campaign, as outlined in their whitepaper. Out of the 49% remaining, 29% will be allocated as community incentives, and the remaining 20% given out to the development team and early supporters. Hence, the final distribution of the tokens will be 4/5 to the community and 1/5 to the development team. The network underpinning Qtum itself is a hybrid fork of the Bitcoin core and something called the ‘account abstraction layer’ (which allows for the creating and executing of smart contracts using a model offered by Ethereum).

FAQ

Before buying Qtum, you will need a place to store it. This is what a wallet is for, and it consists of two elements: a private key and a public address. A wallet requires a private key, specific to the individual, that enables access to the Qtum address stored in the wallet, which is also the public key. The wallet is what enables Qtum, or any cryptocurrency, to be a secure medium of exchange. Essentially, people can send Qtum, to certain wallets using the public key, which only the individual can access with their private key. Some individuals choose to keep their coins in their wallet provided by their cryptocurrency exchange, due to the fact that a lot of exchanges have mobile apps that allow people to easily buy, sell and spend cryptocurrencies.

Cryptocurrency exchanges or online wallets are far from immune to the dangers of cybertheft. The infamous case of the Mt Gox bitcoin exchange highlights this. Historically, Mt Gox was the largest global exchange for bitcoin, until it declared bankruptcy in 2014 after its security had been compromised. Mt Gox had 850,000 bitcoins, valued at $450 million in February 2014, before their exchange was emptied by hackers. It is believed that the private keys of Mt Gox’s digital wallet were stolen from as earlier as 2011. These risks are avoided when trading Qtum CFDs because you do not need a wallet.

A ‘bubble’, in market terminology, is where the price of an asset far exceeds its intrinsic value. For instance, the dot-com bubble that occurred between 1995 and 2001, is a prime example, where information technology industry firms saw their stocks rise, merely because of the market sentiment around that particular industry, irrespective of their profits or chances of succeeding. This market then crashed in March 2000.
 
The problem here is that it is hard to determine the value of cryptocurrency to begin with. Although a lot of investors are holding cryptocurrencies as if they were equities, they are not. Yet they do not particularly act like currencies either, which makes comparisons to currency valuations difficult.  However, with any new technology, caution is advised. It could well be the case that the valuations of bitcoin or ripple are not overvalued, and that the bubble, if there is one, is represented by the various new cryptocurrencies that are being driven by market sentiment. Arguably, this is comparable to the dot-com instance, where stocks like Amazon were not overvalued, but others like Pets.com, which went from IPO to liquidation in 268 days, clearly were. So, it seems that only time will tell whether the market is overheating, but in either case, there are options to trade using CFDs to take both long and short positions.
 
From late 2017 to early 2018, there was a surge in the price of bitcoin (reaching $20,000 per bitcoin), followed shortly behind by other cryptocurrencies. The market then crashed between January and February 2018, and bitcoin free fell, dropping 65% in value. Consequently, most other cryptocurrencies crashed as well. So there clearly was a bubble in the crypto market. The question that this begs is whether there still is one. The value in most cryptocurrencies is derived from their potential; how they could be used to advance society in the future. Without institutional acceptance however, the potential value, will remain merely potential, but whether this implies that cryptocurrencies are overvalued is another question.

The 2018 crypto crash was the biggest sell-off of most cryptocurrencies in the history of the market. From 6 January to 6 February bitcoin fell about 65%. Consequently, nearly all other cryptocurrencies crashed. The cryptocurrency market capitalisation lost at least $342 billion in the first quarter of 2018. Bitcoin peaked at the $20,000 mark December 2017, with most other cryptocurrency peaking shortly after. There were several shocks let ultimately contributed to the cryptocrash: bitcoin price depreciated by about 12% after the Attorney General for the South Korea announced a move to ban crypto exchanges from issuing new trading accounts, later that month Coincheck (a Japanese bitcoin wallet and exchange service) was hacked and approximately 500 million NEM tokens (worth $530 million) were stolen, making this the largest crypto hack to have occurred.

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