By day trading crypto, you will be buying and selling digital currencies throughout the day.

This means that in most cases, you will open a position and look to close it with a small profit just a few hours or even minutes later.

In this guide, we review the best day trading crypto platforms in the market right now alongside some crucial information about how this investment scene works.

Best Day Trading Crypto Platforms List

In order to day trade crypto today, you will need to open an account with a top-rated platform.

The six best crypto day trading platforms can be found in the list below.

  • Bitstamp – Overall Best Day Trading Platform for 2022
  • eToro – Leading Crypto Exchange for Day Trading with Low Fees
  • Crypto.com – One of the Best Crypto Exchanges for Day Trading
  • Coinbase – Top Crypto Day Trading Site for Beginners
  • Webull – One of the Best Apps for Day Trading Crypto
  • Binance – Day Trading Crypto Platform With Low Commissions

Read our full reviews of the above-day trading crypto sites below.

Best Crypto Exchanges for Day Trading Compared

Crypto day trading is one way you can make money with cryptocurrency. Some of the criteria that we look for when reviewing the best day trading crypto platforms include low fees and commissions, lots of supported markets, and access to investment tools and features.

And of course, we only consider day trading crypto providers that offer a safe and secure environment. Taking this into account, the best day trading crypto platforms for 2022 are discussed in the sections below.

1. Bitstamp – Overall Best Day Trading Crypto Platform for 2022

Bitstamp logoOur number one pick when it comes to day trading crypto platforms is Bitstamp. Bitstamp comes highly regarded within the crypto-trading scene, thanks to being established in 2011. The platform caters to over 4 million customers worldwide and offers over 50 different cryptocurrencies for users to trade.

One of the critical things to look out for when choosing a day trading crypto platform is low fees – and Bitstamp certainly meets this criterion. You can invest in cryptocurrency from as little as 0.5% per trade, with a minimum position size of only $10 for USD-denominated assets. The minimum trade amount for BTC-denominated assets is only 0.0002 BTC, making Bitstamp ideal for day traders.

Bitstamp day trading

Traders who exceed $10,000 per month in trading volume will see their fees drop to only 0.25% per trade. In terms of account funding, Bitstamp allows you to deposit ACH with no deposit fees. Withdrawals can also be made for free via ACH, although you can opt to purchase crypto instantly using a credit or debit card if you wish. However, this comes with a fee of 5% per transaction.

The Bitstamp trading experience is exceptional, as users can opt to trade via their browser or the mobile app. Both are suited to day traders, although Bitstamp’s ‘Tradeview’ platform is tailored more towards experienced investors. This platform features in-depth order book information, several technical indicators, and advanced order types – making it ideal if you’re looking to day trade crypto.

Cryptoassets are a highly volatile unregulated investment product. 

2. eToro – Leading Crypto Exchange for Day Trading with Low Fees

etoro revieweToro offers the ultimate balance between regulations, low fees, user-friendliness, and a diverse number of trading markets. This day trading platform is home to over 40+ spot trading markets – all of which are paired against the US dollar. This includes everything from Bitcoin, XRP, and Dogecoin to Shiba Inu, Ethereum, Celo, and AAVE. Moreover, you can also trade digital assets against other fiat currencies, such as the euro and the British pound.

Day traders will also like the dozens of crypto-cross pairs that are supported by eToro. This includes the likes of ETH/BTC, EOS/XLM, and BTC/XLM. Irrespective of which pair you decide to trade, eToro operates a spread-only pricing model. For those unaware of this term, this simply means that you will only need to pay the difference between the bid and ask price of your chosen crypto. This makes eToro one of the best day trading crypto sites in terms of fees.

etoro review

Another perk of choosing eToro as your go-to crypto day trading platform is that you can buy cryptocurrency from just $10. Moreover, $10 is the minimum deposit requirement to get started – so those on a budget are catered for. We also like eToro for its zero-fee deposits and withdrawals on USD balances. Not only does this include payments via domestic bank wire and ACH, but debit/credit cards, Paypal, WebMoney, Neteller, and more.

In terms of core investment features, eToro offers a copy trading tool that allows you to mirror the positions of a seasoned investor. For instance, if your chosen day trader risks 10% of their portfolio on a BTC/USD position, the same trade will be copied in your own account. Most importantly, eToro is the safest day trading crypto site in the market – as the provider is authorized and regulated by the SEC, FCA, ASIC, and CySEC. Alternatively, if you’re looking to day trade stocks eToro is a great option for beginners and experienced traders alike.

Cryptoassets are a highly volatile unregulated investment product. 

3. Crypto.com – Best Crypto Exchange for Day Trading Diverse Markets

crypto.com logo

Next up on our list of the best day trading crypto sites is Crypto.com. Launched in 2016, this platform is popular with traders of all skill sets and budgets. In total, you will have access to over 250+ cryptocurrencies, which cover a great blend of large and mid-capitalized projects. In terms of fees, Crypto.com operates a maker/taker pricing structure, which is particularly useful for day traders.

For those unaware, market makers provide crypto exchanges with liquidity and as such, are offered more attractive commissions. As a newbie crypto day trader, you will be defined as a market taker. And therefore, you will pay a maximum commission of 0.4% per slide. You can, however, benefit from even lower commissions if you trade larger amounts. For instance, if you trade over $50,000 in a 30-day period, then your commission is reduced to 0.15% per slide.

crypto.com review

Moreover, further fee reductions are in place for those holding CRO tokens – which is the digital asset-backed by Crypto.com. Another thing we like about Crypto.com is that the platform makes it easy to get capital into and out of the exchange. For instance, if you are unable to deposit funds via crypto, the platform supports debit and credit card purchases. Bank transfers are also supported. Additionally, you might even consider applying for the Crypto.com debit card.

In doing so, you can instantly withdraw your day trading crypto profits via an ATM. Another aspect of Crypto.com that might interest you is that the platform offers leveraged financial products. Not only does this include the option to day trade crypto with leverage of up to 10x, but you’ll have access to perpetual futures. And finally, if you’re looking for a day trading crypto site that offers advanced tools and charting features – Crypto.com has you covered.

Cryptoassets are a highly volatile unregulated investment product.

4. Coinbase – Top Crypto Day Trading Site for Beginners

It goes without saying that day trading crypto and making consistent profits is no easy feat. And as such, if you’re just starting out in this space, Coinbase might be the best platform for your skillset. In a nutshell, Coinbase has been offering crypto trading services since 2012 and its platform is primarily used by beginners. This is because you only need a few dollars to get started and accounts take minutes to open.

Moreover, if you don’t have any crypto to hand to fund your trading endeavors, Coinbase offers multiple payment methods that allow you to deposit US dollars with ease. This includes debit/credit card and Paypal purchases at a few 3.99% and ACH at 1.49%. Additional fees are charged on deposits of less than $200. Nevertheless, once your Coinbase account is funded, you will then have access to over 50 leading cryptocurrencies.

coinbase platform screenshot

Each and every crypto asset available at Coinbase is traded against the USD spot market. Spreads are competitive here and liquidity levels are significant. In terms of trading commissions, Coinbase is the most expensive day trading crypto site on our list, with the platform charging 1.49% per slide. This means that you will need to make at least 2.98% in profit per trade, as the commission is charged when you enter and exit the market. 

Although the platform is typically used by traders with little to no experience, Coinbase Pro has since been launched for seasoned investors. Not only does this come with more markets – including crypto-cross pairs, but more advanced tools and charting features. Furthermore, Coinbase Pro utilizes a maker/taker pricing structure like Crypto.com, and this subsequently translates into lower fees. Coinbase also offers a mobile trading app for iOS and Android, as well as a secure crypto wallet.

Cryptoassets are a highly volatile unregulated investment product.

5. Webull – One of the Best Apps for Day Trading Crypto  

webull logoMany crypto day traders now look for providers that offer both an online platform and a mobile app. Taking this approach will ensure that you are never more than a click away from the digital currency markets. And, in terms of providers, we found that Webull offers one of the best crypto apps for day trading in 2022. Available on both iOS and Android, the app connects to your main Webull account – you can switch between the two as you wish.

Although the Webull app is user-friendly and suitable for newbies, it also comes packed with features that will appeal to advanced traders. This includes access to technical indicators, live pricing fees, and even customizable charts. In terms of supported markets, Webull offers a relatively thin number of cryptocurrencies. This includes the likes of Bitcoin, Ethereum, Cardano, Shiba Inu, Dogecoin, and several others. You can also use the Webull app to trade equities, ETFs, and stock options.   

webull platform screenshot

Each and every trading market supported by Webull is offered at 0% commission. This means that just like eToro, trading crypto here will only require you to cover the spread. With that said, while eToro spreads start at 0.75% when trading crypto, at Webull this is higher at 1%. Moreover, if you deposit and withdraw funds via a domestic wire at Webull, you will be charged a transaction fee of $8 and $25 respectively. On the other hand, ACH transactions are fee-free. 

Another major feature of the Webull crypto trading platform is that you are not required to meet a minimum deposit. And, even more impressively, both the Webull website and mobile app enable you to trade crypto from just $1. This means that Webull is perfectly suited for day trading crypto newbies. In terms of safety, Webull is regulated by the SEC and registered by FINRA. Moreover, millions of US traders are registered with Webull – so the platform has a great reputation.  

Cryptoassets are a highly volatile unregulated investment product.

6. Binance – Day Trading Crypto Platform With Low Commissions  

binance logo

If you’re looking for the best crypto day trading platform for fees, Binance stands out from the crowd. This is because since the platform was launched in 2017, Binance has offered a headline commission rate of just 0.10% per slide. And, if you find yourself trading larger amounts throughout the month, this commission is reduced. A 25% reduction in commission is also offered for those paying their fees in BNB. 

If you’re based in the US, you will have access to 60 cryptocurrencies on the Binance website. All other nationalities have access to over 1,000 markets. Either way, you can easily deposit funds into your Binance account with fiat money. US clients, for example, can deposit funds via ACH, domestic bank wire, or a debit/credit card. Crypto deposits are also supported. Once your account is funded, you can then choose between the classic or advanced Binance platform.  

binance platform screenshot

The classic platform is suited for those that are just starting their day trading crypto journey. On the other hand, if you seek highly sophisticated trading features, customizable charts, technical indicators, and drawing tools – then the advanced platform will appeal. Moreover, if you’re based outside of the US or UK, Binance also offers a wide range of crypto derivatives. This includes the ability to trade digital currencies with leverage. 

For instance, when trading BTC/USDT, you can apply leverage of up to 10x. This means that a trading position of $100 can be boosted to $1,000. You can also trade crypto futures and options across many markets. In terms of safety, we should note that Binance is not regulated in any country that it operates in. The platform does offer top-rated security tools though – such as two-factor authentication. The platform also has a fund in place should the unlikely happen and Binance is hacked.

Cryptoassets are a highly volatile unregulated investment product. No UK or EU investor protection.

What is Crypto Day Trading?

Crypto day trading is a completely different kettle of fish in comparison to a long-term buy and hold strategy. The reason for this is that seasoned day traders will rarely hold onto a position for more than a few hours.

If you’re looking for a crypto bot to conduct day trading you might want to read our useful Bitcoin Evolution review.

And, depending on the markets, you might even find that day traders open and close a position within a space of just a few minutes.

Crucially, the overarching concept with crypto day trading is that you will look to take advantage of short-term market trends. This means that you will specifically target small profit margins – but on a much more frequent basis.

Before moving on, let’s look at a super-basic example of a crypto day trading position:

  • You think that Bitcoin will increase in value against the US dollars, so you trade the pair BTC/USD
  • You decide to risk $500 on this trade
  • Several hours after opening your position, BTC/USD has since increased by 7%
  • You close your trade with a profit of $35

As you can see from the example above, the crypto day trader was happy to close their BTC/USD position at a profit of 7%.

This is the case even if the trader believes that Bitcoin is likely to continue rising in value over the course of the next few days. And therefore, as a day trader, you need to be disciplined.

Alternatively, if you’re looking for a more passive approach to crypto day trading, then you might want to check out our guide on the best trading robots for 2022.

Pairs 

One of the first things that you will need to learn when day trading crypto is that digital currencies are bought and sold in pairs. For example, at Bitstamp, the platform allows you to trade both fiat-to-crypto and crypto-cross pairs.

  • Fiat-to-crypto pairs will contain one digital asset (e.g. XRP) alongside a fiat currency (e.g. USD). These pairs are easier to day trade, the value of the respective pair can be quantified in your preferred currency.
  • Crypto-cross pairs, on the other hand, contain two digital assets. For instance, in day trading ETH/EOS, you are looking to speculate on whether Ethereum will rise or fall against EOS.

As a newbie, it’s best to avoid crypto-cross pairs, as there is no fiat benchmark that allows you to easily assess the value of your position.

Crypto Day Trading Orders

In addition to pairs, crypto day trading also requires you to have an understanding of orders.

The most important orders to be aware of when day trading crypto is as follows:

  • Buy orders are used to enter the market, while sell orders allow you to exit a position. If you engage in short-selling, this is reversed. For instance, if you short-sell BTC/USD, you would enter with a sell order and close the trade with a buy order.
  • Limit orders allow you to specify the price that your trade is opened. If you want the trade places instantly at the next best available price, you can use a market order.
  • To ensure you do not lose too much money, consider setting a stop-loss order.
  • To lock in your profit targets automatically, you can do this via a take-profit order.

We should note that not all day trading crypto sites offer the order types outlined above. As such, this is yet another factor that you need to consider when choosing the best crypto platform for day trading.

Crypto Day Trading Rules

In the traditional investment scene – US-based traders are required to follow the pattern day trader rule. In a nutshell, this means that if you place four or more trades within a 5-day period, you are considered a day trader.

And as such, you must have a capital balance of at least $25,000. It goes without saying that this makes day trading out of reach for many.

crypto day trading rules

However, the good news is that cryptocurrencies do not fall under the remit of the pattern day trading rule. And as such, you can day trade crypto with any amount of your choosing.

With that said, if you decide to trade crypto with leverage and you are using an SEC-regulated platform for this purpose, you will still need to meet the minimum margin balance requirement of $2,000.

What is the Best Crypto for Day Trading?

One of the best things about day trading crypto is that there are no restrictions on which digital currencies you can target.

After all, you are only looking to keep positions open for a matter of hours or minutes, so your overarching goal is to profit from short-term trends.

With that said, some digital currencies are better for day trading than others – especially those that benefit from high levels of liquidity.

Moreover, crypto traders will often seek pairs that attract higher levels of volatility – as this presents plenty of profit-making opportunities throughout the day.

If you’re still not sure which cryptocurrencies are the best to day trade for your investment objectives – consider the five digital assets discussed below.

1. Lucky Block

One of the best altcoins to consider if you’re looking to day trade crypto is Lucky Block. Lucky Block is an exciting crypto-lottery platform that looks to leverage blockchain technology to offer transparent daily prize draws with greater odds of winning for each entrant. Lucky Block’s native token, LBLOCK, was initially listed on PancakeSwap in January 2022, leading to remarkable price increases in the days and weeks that followed.

LBLOCK price chart

By the middle of February, LBLOCK had surged over 3,200% from the token’s pre-sale price, netting early investors impressive returns. Although the price has dipped slightly from this point, Lucky Block still possesses a fully-diluted market cap of over $318 million. Notably, the incredible popularity of LBLOCK on various exchanges has made the token ideal for day trading – with 10%+ moves each day not being uncommon.

Interestingly, a recent post in the official Lucky Block Telegram group detailed V2 of the LBLOCK token, which will be compatible with centralized exchanges. This is excellent news for day traders, as it dramatically increases the potential universe of investors that can access LBLOCK, leading to greater liquidity and clearer price action. Overall, due to the factors noted above, LBLOCK is our pick for the best crypto to day trade this year.

Cryptoassets are a highly volatile unregulated investment product. 

2. Bitcoin

If you are just starting out in the world of crypto day trading, you may also wish to stick with Bitcoin until you get more comfortable. Depending on your chosen platform, this might be traded at BTC/USD or BTC/USDT. Either way, both pairs allow you to day trade the future value of Bitcoin against the US dollar.

Importantly, Bitcoin carries the largest amount of liquidity and trading volume than any other digital currency. And as such, you will benefit from tighter spreads. Moreover, although Bitcoin is still volatile, you will likely find that pricing spikes are not as parabolic when compared to other digital assets.

3. Ethereum

In a similar nature to Bitcoin, Ethereum is a large-cap cryptocurrency that benefits from large levels of volume and liquidity. As the world’s second-largest cryptocurrency in terms of market capitalization, you’ll have no issues finding a suitable platform to trade.

ethereum price

To give you an idea of pricing action over the prior 12 months, Ethereum carries a 52-week high of $4,900 and a low of $1,300. With a spread of over 110%, this volatility means that Ethereum is a great crypto to day trade. Moreover, Ethereum can be traded not only again the US dollars, but hundreds of alternative digital assets.

4. Dogecoin

Dogecoin was one of the hottest cryptocurrencies in the first half of 2021, with gains of over 10,000% witnessed in just a matter of months. However, after hitting highs of $0.74 per token, Dogecoin has since entered a bearish cycle – with 2022 lows of $0.17.

With that said, if you’re looking to follow market trends and day trade crypto based on volatility and hype, Dogecoin is well worth considering for this strategy. This is because its value is often dictated by speculation – especially when Elon Musk tweets about the digital currency.

5. BNB 

If you’re an upside investor that wishes to day trade undervalued tokens, BNB is another crypto asset that is worth focusing on. The digital currency is backed by the Binance exchange and is now firmly a top-5 crypto asset in terms of market capitalization.

BNB hit highs of almost $700 in late 2021 but has since dropped below the $400 level. And as such, this allows you to day trade this cryptocurrency at bargain prices.

How to Pick Crypto for Day Trading?

There are several core metrics that make certain digital currency pairs better for crypto day trading than others.

This includes the following:

Volume and Liquidity  

The most important thing to consider when deciding on which day trading crypto pair to target is with respect to volume and liquidity.

  • Volume refers to the amount of trading activity that a specific pair attracts over a certain period of time – usually on a 24-hour basis.
  • Liquidity refers to the amount of capital available in a specific market.

Naturally, the more volume that a pair attracts, the greater level of liquidity it offers. And, most importantly, in trading highly liquid pairs, you will find it easy to enter and exit positions at suitable prices.

  • For example, in trading large-cap cryptocurrencies like Bitcoin, Ethereum, Cardano, or BNB – you will never struggle to find a buyer when you eventually decide to cash out.
  • And in turn, market spreads will be a lot more competitive, so you won’t need to accept an unfavorable price to exit your position.

On the other hand, when you target smaller-cap cryptocurrencies, you will find that trading volumes are much lower. In turn, this results in low levels of liquidity.

And, a direct consequence of this is that you might find it difficult to find a suitable buyer when you decide to close your day trading position.

If this is the case, you might need to accept a much lower price to cash out – which in many cases, can wipe out your profits on the respective position.

Volatility  

The next metric to consider when choosing the best crypto to day trade is how volatile the respective pair is. It goes without saying that in comparison to traditional stock markets, cryptocurrencies are a lot more volatile.

However, as noted earlier, certain projects are much more volatile than others. The general rule of thumb in this respect is that the smaller the market capitalization, the more volatile the cryptocurrency.

This is because it doesn’t take much trading activity to result in a wild pricing swing.

For example:

  • In the 24 hours prior to writing, Bitcoin has hit a high of $38,359 and a low of $36,488 – as per CoinMarketCap. This translates into a volatility spread of just under 5%.
  • At the other end of the spectrum, Anchor Protocol has hit a 24-hour high and low of $3.04 and $2.38 respectively. This amounts to a much wider volatility spread of nearly 25%.

In terms of whether or not you should target markets with enhanced volatility levels will ultimately depend on your experience in the day trading crypto space.

That is to say, experienced traders will seek volatility, as wild pricing swings permit frequent opportunities to enter and exit profitable positions. On the other hand, if you’re a complete novice, then you might want to start with less volatile crypto markets.

Tight Spreads  

Finding digital currency markets that offer tight spreads is super-important in the crypto day trading arena. As we briefly explained earlier, the spread refers to the percentage difference between the bid and ask price of the crypto pair you are trading.

And, in order to make a profit when day trading crypto, you need to make gains greater than the spread. For instance, if the spread on BTC/USD amounts to 0.75%, then your position needs to grow by at least this amount for you to make a profit.

day trade bitcoin strategy

The spread that you are charged will be determined not only by your chosen crypto trading platform but also by the specific digital asset itself.

Usually, if you’re trading highly liquid pairs like BTC/USD or ETH/USD, then you will benefit from tighter spreads. But, if trading less liquid markets with low daily volumes, then a wide spread will make it challenging to enter and exit a trade with gains.

New Projects    

Some of the most profitable day trading positions are associated with newly launched cryptocurrencies.

This is because – just like a stock IPO, oftentimes a digital currency will be at its most favorable price after it first launches onto an exchange. And as such, by keeping an eye on upcoming exchange listings, can be a great way to enter profitable day trading positions.

Announcements and Developments 

Another great way to find the best crypto markets to day trade is to keep an eye on project announcements.

  • For example, if you come across a cryptocurrency that has just had its Binance exchange listing application approved, history suggests that the digital asset in question will experience a rapid upward pricing swing.
  • And, by getting your day trading order in as early as possible, this offers an attractive upside potential over a short period of time.

On the other side of the coin, negative news developments can result in a digital currency losing value – and quickly.

For instance, when it was announced that the Binance exchange was hacked for over $40 million in May 2021, the value of BNB took a major hammering.

To have profited from this downfall, you could have placed a short-selling selling order with your day trading platform.

Crypto Day Trading Strategies

The only way to make consistent gains when day trading crypto is to have some strategies in place. Not only in terms of targeting profitable positions, but protecting your capital through risk-management practices.

To help point you in the right direction, below we discuss some proven crypto day trading strategies that you might want to consider.

Strategy 1: Bankroll Management  

The first strategy to incorporated when learning how to day trade crypto is with respect to bankroll management. In its most basic form, this refers to the process of protecting your investment capital at all costs.

  • The most tried and tested way of achieving this is to set some clear restrictions on the amount of capital that you can risk on a single trade.
  • For example, you might decide that no more than 2% of your balance should be risked per position.
  • This means that with a balance of $10,000 – your maximum trade size stands at $200.
  • Then, if in a few months’ time you have increased your balance to $20,000, your maximum trade size stands at $400.

In taking this approach, the theory is that you will never burn through your trading balance. After all, if you go on a run of bad form and your balance continues to decrease, as will the maximum trade size that you can enter.

For example, if your balance went from $10,000 to $5,000, the maximum amount that you can risk per trade – at 2%, is reduced from $200 down to $100.

Strategy 2: Stop-Loss Orders  

We briefly made reference to stop-loss orders. But, taking into account just how important they are to your long-term day trading goals, we should elaborate on how they work.

Put simply, when you set up a day trade, you will have the option of choosing a stop-loss price. This is the price that your chosen platform will automatically close the position – should the trade move against you.

For example:

  • Let’s say that you risk $1,000 on an ETH/USD buy order – meaning you think the price of the pair will increase
  • When you place the trade, ETH/USD is priced at $3,000
  • But, just in case your speculation is wrong, you set up a stop-loss order at $2,700
  • This means that should ETH/USD drop by 10%, your chosen crypto day trading platform will automatically close the position

Crucially, when you consider just how volatile the broader crypto markets are, setting up stop-loss orders on each and every position is imperative.

In doing so, you can take full control of your losing trades and ensure that you avoid burning through your account balance.

Strategy 3: Take-Profit Orders  

In reverse to the aforementioned stop-losses, you have take-profit orders. This allows you to lock in your profit targets automatically, meaning that you don’t need to be sat at your device waiting for the right time to cash out.

For example:

  • Let’s say that you wish to make a day trading profit of 3% on a BNB/USD position by going long
  • When you place the trade, BNB/USD is priced at $400
  • This means that your take-profit order should be set at $412

Regardless of whether or not you see the 3% upswing, if it is triggered by the markets, your chosen platform will automatically close the trade on your behalf.

Strategy 4: Focus on a Small Number of Markets  

Another proven crypto day trading strategy is to focus on a small number of markets. In doing so, you will have an intimate understanding of how the respective pairs operate.

  • For example, you might find that BTC/USD attracts huge support at the $42,000 level and mass resistance at $44,000.
  • Similarly, you might find that ETH/USD typically performs well when the RSI sits above 40.

The key point here is that by becoming an expert in a small number of crypto markets, you stand the best chance possible of making consistent profits.

Otherwise, by attempting to become a Jack of all trades, you might find that you are entering positions in the dark.

Strategy 5: Consider Copy Trading  

If the thought of spending months or even years learning the ins and outs of how to day trade crypto is overwhelming, there is another option to consider.

Put simply, SEC-regulated broker eToro offers an innovative copy trading tool that allows you to actively speculative on the digital currency markets without needing to do any of the legwork.

etoro copy trading crypto

This is because you will elect to mirror the buy and sell orders of an experience crypto day trader. In essence, any positions that they enter and exit will subsequently be replicated in your own portfolio – but at a stake that is proportionate to your original investment.

Here’s an example of how the copy trading tool works at eToro:

  • You decide to invest $3,000 into a crypto day trader that has a long-standing track record on the eToro platform.
  • The first position that the trader enters is a buy order on BTC/USD. The trader risks 10% of their portfolio on this position.
  • In turn, eToro will automatically copy the trade in your portfolio – but at a stake of $300 (10% of $3,000 investment).
  • The crypto day trader closes the position a few hours later at gains of 6%
  • Your position is also closed and in total – you made a profit of $18

The most attractive thing about the above copy trading example is that you were able to make gains of 6% without needing to place any orders. Moreover, you were not required to do any research either.

Is Crypto Day Trading Profitable?

There is no surefire way to determine whether or not crypto day trading will be profitable for you. After all, there are simply too many factors at play.

At the forefront of this is whether or not you have the required skill set to consistently enter profitable positions. That is to say, if you encounter more unsuccessful trades than winners, then invariably you will lose money.

Another factor to consider is that the main concept of crypto day trading is that you will seek to make small but frequent gains.

This means that if you have a small amount of trading capital at your disposal, you might find it difficult to make enough money in dollar terms for the process to be worthwhile.

  • For example, if you have a trading balance of $500 and make 2% in a day, this amounts to just $10 in profit.
  • On the other hand, if you reside in a country that permits crypto CFDs, you can apply leverage to your position.
  • This means that you can amplify the value of your trade. Of course, applying leverage will also boost losing positions, so do tread with caution.

Ultimately, this is why you might consider the eToro copy trading tool. In doing so, you won’t need to have any knowledge of how crypto day trading works, as your chosen investor will be placing orders on your behalf.

How to Start Day Trading Crypto

Now that we have covered the nuts and bolts of how crypto day trading works in practice, we can now show you how to get started with your first position.

For this step-by-step explanation, we will show you how to trade crypto from just 0.5% per trade with the highly-respected platform, Bitstamp – all in a matter of minutes.

Step 1 – Open a Bitstamp Account

Head over to Bitstamp’s homepage and click ‘Get Started’. You’ll then be asked to enter your full name, date of birth, and email address to create your account.

Bitstamp sign up

Step 2 – Verify your Identity

New users must verify themselves before being able to utilize their accounts fully. To do so, click ‘Personal account verification’ on your trading dashboard and complete Bitstamp’s KYC checks. After this, upload proof of ID (e.g. passport) and proof of address (e.g. utility bill). 

Step 3 – Make a Deposit

Bitstamp will email you once your account has been verified, at which point you are free to make a deposit. Click ‘Deposit’ on your dashboard and choose ACH if you are a US-based trader.

Bitstamp will then provide some bank details, which you can use to make a manual transfer from your bank. Once the transfer is complete, the funds can take 1-2 business days to be available in your trading balance. 

Step 4 – Choose a Crypto to Trade

You can now open one of Bitstamp’s web-based trading platforms (or the mobile app) and search for the coin you’d like to trade using the search bar. Once it appears, click ‘Buy’.

Bitstamp crypto trading 

Step 5 – Start Day Trading

An order box will appear on your screen, in which you can enter your desired position size, choose which order type you wish to employ, and opt for a stop-loss/take-profit level if you wish. Once you are happy with everything, click ‘Buy’ again to complete the trade.

bitstamp buy crypto

Day Trading Crypto Taxes

Just like stocks, index funds, forex, or any financial instrument for that matter – you can be certain that your country of residence has a taxation policy on crypto profits.

Other than a few exceptions, most jurisdictions will tax you in the form of capital gains. This refers to the profit element of a trade. For example, if you place a $1,000 trade on EOS/USD and make a profit of 10%, then your capital gains amount to $100.

With that said, taxes on crypto day trading positions are complex – so you should speak with a qualified professional to assess where you stand.

Cryptoassets are a highly volatile unregulated investment product. 

Conclusion

This guide on how to day trade crypto has covered everything you need to know to begin your investment journey in the right way. We’ve discussed the best crypto day trading strategies, what risks to consider, and which digital currency pairs to target.

And in conclusion, if you’re looking to start day trading crypto right now in a low-cost environment, Bitstamp is well worth considering. There is no minimum deposit to get started and you can trade from only 0.5% per position.

Bitstamp logo

Cryptoassets are a highly volatile unregulated investment product. 

Frequently Asked Questions on Day Trading Crypto

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