Cryptocurrencies as an investment class is gaining the attention of professional traders, family offices and institutional investors. At a time when the coronavirus pandemic led the global economy to a recession and federal governments around the world are responding with unprecedented stimulus efforts, cryptocurrencies have outperformed stocks, bonds and commodities. Market experts argue that digital assets should now make up a key part of any asset portfolio.
Still trading cryptocurrencies is quite complex. The overall volatility of this market make the process hard even for experienced traders, not to mention newbies. The advanced crypto trading platform LCX Terminal steps forward to facilitate the process with the help of its new Cryptocurrency Smart Order Routing (SOR) service.
Smart Order Routing for Cryptocurrencies is the process of automatically finding the best available price across multiple exchanges to optimize the outcome of trading any pairs.
Invented in 2008 and released to the general public in 2009, Bitcoin has inspired many IT projects to create their own alternative cryptocurrencies or altcoins based on its open-source code. As a result, there are now more than 5,000 cryptocurrencies available for trading according to CoinMarketCap.
Although Bitcoin was initially created as an alternative peer-to-peer electronic cash system, to stand in place traditional fiat money and payment services, the limits of scalability and level of its volatility prevents it from being adopted at a mass scale. However, the diversity of digital assets serves as a perfectly fertile ground for traders, hedge funds, and professional investors. Compared to traditional stock markets, this market is still pretty young, but it has already revealed a number of serious problems, among which are the following:
All these issues reduce the profitability of the whole enterprise and at the same time increase the amount of routine work that traders and asset managers have to accomplish on a daily basis. Institutional investors and hedge funds come across problems with liquidity and cannot use their capitals at full capacity due to technical inefficiencies of centralized exchanges.
A solution is needed to eliminate all these problems, and this is exactly what LCX Cryptocurrency Smart Order Routing service is designed for.
Smart Order Routing or shortly SOR is indeed a perfect tool to cope with ever changing prices and liquidity problems. This is an automated tool that helps process orders at the best price available across multiple markets in real time. In order to provide the best offer, it checks the current rate for any selected pair across different exchanges and helps to find the route to make a switch.
The advantages of such an approach are plenty. With the help of SOR, you can:
The last benefit can be most interesting for sophisticated traders with solid experience behind their shoulders. Let’s take a closer look and see how Smart Order Routing can help you not only eliminate inefficiencies of the cryptocurrency market but even make them work for you.
Arbitrage is the process of taking advantage of inefficiencies in markets. Initially discovered on traditional stock markets, arbitrage trading makes it possible to use imbalances in prices between various markets for your own profit.
Here’s a real-life example, taking our utility token, to showcase how it works. Let’s say, 10’000 $LCX is offered at Liquid Exchange for 0.41 ETH (approx. 86 USD) and for 0.49 ETH (approx. 101 USD) on IDEX Exchange. There is an arbitrage opportunity of 0.08 ETH (approx. 17 USD). Purchasing a crypto asset in one place and selling it in the other one wouldn’t make you a fortune. However, if you trade these assets in bulks and more often, you can get a very good price. Note: Once you purchased LCX Token you can simply use it to upgrade to a pro account at LCX Terminal.
The same approach is easily applicable to other cryptocurrency assets. The price for the same digital assets can vary significantly across different exchanges. LCX Smart Order helps to automate arbitrage trading across multiple exchanges and saves you tons of time and effort.
LCX Smart Order is useful for anyone who is exposed to crypto assets. LCX Smart Order helps you deploy real-time trading strategies directly across any combination of markets and exchanges. LCX’s smart order routing system is an easy-to-use platform, integrating industry-leading charting tools and advanced order management features. The following groups of users can particularly benefit from using it in their daily trading activities.
Intelligent Smart Order Router technology works for almost any crypto trading pair and ensures better execution across multiple venues. Sign up for a free account at LCX Smart Order. To make use of the automation benefits provided by the tool, follow the step-by-step instruction given below:
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