What is Spot Trading?
Spot trading refers to the exchange of one cryptocurrency for another through trading. For example, in the BTC/USDT trading pair, users can purchase BTC using USDT, or conversely, sell BTC in exchange for an equivalent amount of USDT.
How to Profit from Spot Trading?
Traders can profit from spot trading by buying low and selling high to capture price differences. For example, if a user buys 1 BTC when the price is 16,000 USDT and later sells it at 18,000 USDT, the profit, excluding transaction fees, would be 18,000 - 16,000 = 2,000 USDT.
Advantages of Spot Trading
In traditional currency exchange processes involving fiat currencies, converting USDT to BTC requires first selling USDT for fiat and then using the fiat to purchase BTC. However, with spot trading, users can directly purchase BTC using USDT in a single transaction, significantly reducing processing time and enabling quicker and more timely responses to market movements.