Which is better, spot or futures trading?

In spot trading, investors purchase and hold onto the actual cryptocurrency asset, shunning the complexities of borrowing funds or leveraging their positions. This approach fosters a sense of ownership and stability, aligning with the essence of long-term investing.

On the contrary, futures trading caters to those seeking rapid gains through short-term speculation. It offers advanced tools such as leverage, which amplify both profits and losses, making it a double-edged sword.

Hedging is another key aspect of futures trading, enabling investors to protect their portfolios against adverse market movements. By taking offsetting positions in the futures market, traders can mitigate risks associated with spot market fluctuations.

Shorting, a unique feature of futures trading, allows investors to profit from declining market prices. This strategy is particularly attractive during bearish markets, when spot trading might not yield desirable returns.

Cryptocurrency trading encompasses a multitude of strategies, each tailored to suit varying investment goals and timelines. Among these, spot trading stands out as a preferred choice for investors with a long-term horizon.