What Is Spot Market?

A spot market is like a public market where you can trade cryptocurrencies and get your deal done right away. It's different from a futures trading where you settle your deal later.

Get to Know with Spot Market

Imagine a market where you can trade cryptocurrencies and get the deal done on the spot, without waiting. That's a spot market. Unlike futures trading, where you settle things later, spot trading means you buy crypto with the money you already have. 

You can't borrow extra money to trade.

How to Trade in the Spot Market for Crypto?

To trade in the spot market, you use the money you have in your account. You buy crypto with what you've got, without borrowing extra. That means you can only trade as much as you have in your account. It's safer because you can't lose more than you've invested. But unlike in margin trading, you can't use borrowed money to make bigger trades.

Spot market trading is more about playing it safe and making steady profits. It's not as risky as margin trading, where you could lose everything if the crypto crashes. So, it's good for beginners who want to avoid big risks.

Spot Market vs. Futures Market

Spot market and futures market are different in what you're trading. In the spot market, you're buying the actual assets. But in the futures market, you're buying the rights to buy the assets later. That's why futures markets are called derivatives. 

Futures trading is more for short-term trades and using leverage, while spot trading is better for long-term investments.

Also Read

What is Day Trading?

What's that Arbitrage Trading?

Get to know Insider Trading in the Crypto World and Case Examples

DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.