Ethereum CFD Trading

Ethereum CFD Trading

Ethereum CFD Brokers Comparison Table
Online BrokerMinimum DepositEthereumEthereum ClassicBroker vs Broker
City IndexNoneX
Dukascopy$100X
ThinkMarkets$250X
Z.com Trade$50X
FXOpen$300
FOREX.com$50X
Plus500$100X
UFX$100
AAAFx$300X
ITRADER$250
Pepperstone$200X
RoboMarkets$100X

Ethereum Broker Comparison

These brokers offer trading in Ethereum CFDs. Some offer Ethereum Classic CFDs. Cryptocurrencies, including Ethereum and Ethereum Classic, are subject to highly volatile price movement. All these brokers also provide other markets to trade.

The brokers themselves can be compared in more detail, broker versus broker, to compare minimum deposits, account types, markets (including other cryptocurrency CFDs), leverage, spreads, regulation and platforms.

Ethereum

Ethereum is an open source platform developed by the Ethereum Foundation. A function of the platform is to allow users to run applications, called smart contracts. These smart contracts are computer programs which are compiled to run on the blockchain (which consists of networks of computers). This expansion of the use of the blockchain beyond cryptocurrency payment processing (although it is still used for this), is sometimes called Blockchain 2.0.

So what is the cryptocurrency ? The platform has a value token (i.e. cryptocurrency) which is called 'ether', which allows value to be exchanged. The cost of running an application on the blockchain (i.e. its resource requirement) is calculated in units called 'gas', which have a cost in ether. The token ether is also created as blocks of transactions are mined. Payment processing, program processing and currency creation, happens in a decentralised manner.

The cryptocurrency ether is traded as ETH on cryptocurrency exchanges. The brokers above are not cryptocurrency exchanges, but are rather CFD brokers offering Ethereum CFDs to trade based on the value of the underlying asset 'ether' in dollars or euro (e.g. ETH/USD or ETH/EUR).

In CFD trading, the trader does not own the underlying asset (which means no wallet is needed to hold ether), but exchanges contracts through a CFD broker based on the price of the underlying asset. The tools provided for trading other CFDs can be used, such as charting.

Ethereum Classic

Ethereum Classic provides a platform for smart contracts, operated independently of the Ethereum Foundation. Its traded token is called ETC.

Ethereum Classic is offered by some of these brokers, as CFDs based on the value of ETC in dollars (e.g. ETC/USD).

Ethereum Classic is called 'Classic', since it was a continuation of the Ethereum blockchain (as Ethereum itself performed a hard fork). Ethereum Classic was a response initially to changes Ethereum made to its blockchain. These changes caused a fork from the blockchain. So Ethereum Classic continued the Ethereum blockchain without those changes (to which some users of Ethereum objected).

What were the objections about ?

The objections resulting in Ethereum Classic, were to changes made to the Ethereum blockchain which blacklisted some transactions, the way these changes were allowed and the way the hard fork was performed and what it did to the Ethereum blockchain. It should be noted that Ethereum made these changes as a way to protect itself. However for Ethereum Classic, these changes were against the grain of Ethereum and its principles that executed programs must run, that the transaction ledger must be immutable and control must be decentralised.

Both platforms use 'smart contracts', what are these ?

An Ethereum or Ethereum Classic smart contract is an application which is executed on the blockchain. It is designed to be run, exactly as programmed, and be unstoppable. The reason these conditions can be true, is a consequence of the way the program is run: i.e. decentralisation. Control is distributed about the network, and the programs or contracts are run by incentivised disinterested miners. There is a cost associated with executing applications on the blockchain. These costs are processed by miners, who process transactions into chained blocks of data. The creation of these 'block chains' (hence the name) results in the creation of ETH (or ETC), thus rewarding the miners for their work (i.e. they are rewarded as a consequence of doing the work, not by someone to do the work).

Do Ethereum and Ethereum Classic limit the total number of their cryptocurrencies which can be mined ?

Cryptocurrencies are created as blocks of data are processed on the blockchain, a reward and incentive to miners to do this. Currently the upper limit for Ethereum Classic is 230 million ETC. Ethereum does not currently have a total limit on the number of ETH which can be mined.

Summary

Ethereum and Ethereum Classic are both platforms which aim to extend the reach of blockchain. One, Ethereum Classic, originated as a continuation of the blockchain from which Ethereum forked. These platforms have value tokens called ETH and ETC, respectively. These value tokens or cryptocurrencies can be traded as CFDs, based on their price movement, at some CFD brokers. The trader does not own the underlying cryptocurrency.