I mean on some level if you're doing this kind of trading then yeah BTC/ETH/etc trading is similar to trading real currencies.
I think the difference is that the real currencies have a well-known utility at the moment - they're a means of exchange for goods and services. If you're selling EUR to someone, the chances are they're using that EUR to pay for these in the eurozone. If you're buying USD, you're also likely to need that to buy USD-denominated things.
If you're a forex trader, you're trying to make money from people's need to use these currencies.
If you're doing that for crypto, you're doing that but for people who are just also buying and selling crypto - not actual goods or services.
well if you extend the analogy between crypto coins and FX, a long-only strategy makes as little sense in crypto as FX. Why would I hold dollars or yen long-term, instead of investing in assets which are productive like equites or bonds.
So you're buying into trust of that government. With BTC you're buying into trust of the technology and other network participants. Is it really so different? I don't trust governments so much - my local currency is currently facing 25% YoY inflation. I bought Bitcoin.
I wouldn't say trust. But an entire nation is required to accept it so there is a market for it. Plus with interest rates nations are paying you to hold it.
I don't do Forex trading so I'm not particularly defending it. The currency I hold is the one that has utility to me. It's the one I'm paid in, the one I pay taxes in. I don't particularly want it jumping up or down 100s of %. I want it to be stable.
If bitcoin is more stable than your local currency go for it, (although if inflation is 'only' 25% it still doesn't seem to meet that bar). But that says more about your currency than the bitcoin and it still doesn't make it an investment. Your case would seem to be better served by holding USD though.
My first post pointed out it wasn't a very good investment. You seem to be buying it as a store of value, but it isn't very good at that either. So all were left with is a distrust of government. But the cure is worse than the disease.
It's much simpler. People want $ for £ for education tourism etc. Successful forex traders are just middlemen for these txns. The make sure that you can always sell $ even if there is no one to buy them at that exact moment.
Well, and isn't it the same for BTC then? In the city where I live, there's tons of Bitcoin ATMs everywhere - and people using them, pretty clearly to go around their everyday business, as if it was a bank ATM.
(I'd really like to know. To me, BTC trading and Forex trading sound exactly the same.)