What is cryptocurrency trading via formula, and how do I set it up?

Charts, candlesticks, trends, resistance and support line levels, volumes, and stacks. Without good knowledge about trading (and finance in general), it’s impossible to trade cryptocurrencies. Or is it still possible? We advise what is a formula for price calculation, how and what trading conditions are set (with detailed guide), and where to find P2P-platform, which doesn’t limit its functionality by cryptocurrency to fiat currency exchange (and they are absolute majority) and which is alternative to cryptocurrency exchange, but with the easiest in trading.

cryptocurrency trading via formula

The cryptocurrency market is saturated – according to CoinMarketCap, in April 2021 their number reached 4,500. Not all projects are active, and not all are promising/safe.




This needs to be understood. This material is not a recommendation to trade and is provided for informational, analytical purposes.

What are P2P exchanges?

P2P-crypto-exchanges (OTC trading) is commonly referred to simply: it is an easier and faster way to buy and sell cryptocurrencies.

Such a resource allows traders to interact in transactions directly. The user can:

  • Quickly exchange fiat funds for crypto (buy cryptocurrency) at the most favorable offer;
  • Exchange crypto assets for regular currency (sell) in a few clicks.

It is because of this functionality that such platforms are most often referred to simply as cryptocurrency exchanges. The platform in this case acts only as a guarantor of security. That is, it does not interfere in the process, if not asked (for example, if you need to challenge, etc.).

But alternative trading platforms for crypto exchanges are not always limited to such functionality. There are some that extend their functionality with working trading tools that do not involve a deep understanding of technical analysis tools. So, today we are going to talk about a specific case – Bitcoin Global P2P, and its unique tool – crypto trading with a given formula. The spoiler is very simple.

No TA, no orders, no risk

The more varied orders a cryptocurrency exchange offers, the better – because it definitely gives more opportunities to the trader and provides customer interest – to the platforms themselves.

For example, in order to sell or buy cryptocurrency on WhiteBIT on a spot, you can place one of the six orders offered: limit, market, stop-limit, stop-market, and authorial orders – condition-limit and condition-market. Any of these orders will execute when the conditions that the user sets are met. Somewhere these conditions are easier, somewhere they are more complicated. In any case, to set the parameters of order without making a loss, it is necessary to understand how they affect the final result of trading and the market as a whole.

Another trading difficulty encountered on cryptocurrency exchanges is the volatility of assets. The price of bitcoin, ether, litecoin, etc., can change every second. This leads to the problem for beginners and not very advanced traders: any type of trading (spot, futures, margin trading) requires the ability to catch trends and analyze assets with the help of technical analysis instruments.

Important: as a rule, it is Bitcoin that leads other coins. You can read more about what influences its price formation in a separate article on this topic.

This is where we talk about P2P, not as a trivial exchanger, but as a simplified way to trade cryptocurrencies. You don’t [necessarily] need to know trends, read signals and use technical analysis tools to place an ad to buy or sell cryptocurrencies. The user chooses a profitable offer and executes the transaction. The owner of the assets for sale sets a margin to his ad – and that’s his benefit.

Synopsis: Margin is the amount that makes up the profit in trade in relation to the set and market price.

About Bitcoin Global’s unique P2P solution

A trader’s ad at any P2P marketplace is linked to the market price and is updated every minute. But how to control the price of the ad without constantly monitoring the prices so that an unprofitable price is not formed?

As one of the advanced solutions offered in the cryptocurrency market today is P2P Bitcoin Global’s “Price Calculation”. With this tool, the user can think through, set, and modify the terms of their listings to buy or sell through a customizable transaction formula. This option is particularly suitable if many listings are posted. That is if the purpose of their author is not just to sell their assets, but to trade. Accordingly, the profit factor is also set in the formula.

In brief, the user can rely on the automation of the formula, which he or she will first adjust to his or her needs. He can set one or even several crypto exchanges to auto-refresh prices for a particular pair. When prices do not match, the one that will be more profitable in the output is automatically determined.

If there are no trades for a pair on the selected source crypto exchange, or if the trading volume is low, the formula is considered invalid and the ad gets the status “inactive”. The risk of making an unprofitable deal is thus minimized.

What is cryptocurrency trading via formula

How the formula is set up and works

The Bitcoin Global resource allows you to formulate trading conditions in this way:

One chooses a data source (on Bitcoin Global this is Coinbase, Bitstamp, Kraken, WhiteBIT, Bitfinex) and sets the price type as an additional parameter.
In simple words, first, the user chooses one or two exchanges for the formula, from which the most favorable price for the asset will be “pulled up”.

At the initial stage, the formula looks like this (as an example):

Exchange_usd name

Then another value is set, which acts as a reference for price generation in the announcement. Thus, one of the table parameters is added to “Exchange_usd name” through underscore:

Parameter  Description
high The highest price of a completed transaction in the last 24 hours
low Lowest closing price in last 24 hours
bid Ask Price, which is the highest price the buyer is willing to pay
ask Offer Price, which is the lowest price the seller is willing to pay
close The price of the last completed transaction
avg The average price of completed transactions in the last 24 hours
last Last price

As a result, our approximate formula looks like this:

WhiteBIT_usd_close

Additional parameter: setup of profit coefficient.
Actions with the profit ratio that the user wants to get are performed here. For example, 1.15. Depending on the task, it can be multiplied, divided by the formula parameter, and so on.

Operator Description
+ add two values
subtract one value from the other
* multiply two values
/ divide one value by another
min determine a minimum value
max determine the maximum value

Now the formula will look like this:

WhiteBIT_usd_close*1.15

To add even more profitable rate for a trader to the announcement, the max value can be added to the formula.

As a result, it will be formulated as follows:

max(Kraken_usd_close, WhiteBIT_usd_close)*1.15

Additional option: convert ad price to local currency.

You can then configure that the ad price is automatically converted to the local currency or another currency desired by the trader. The final view will be as follows:

max(Kraken_usd_close, WhiteBIT_usd_close)*USD_in_EUR*1.15

Thus, there is no need to constantly monitor the ad values. Also, the risks of unprofitable deals are minimized, but the market advantage is gained.

How to choose P2P: Guidelines

The speed of transactions and the variety of payment methods are important for OTC trading. How high these rates are on a particular platform depends on the number of countries the platform works with. Bitcoin Global P2P serves traders in 160+ countries, with around 60 payment methods and over 100 currencies provided for their comfort. The goal of such platforms, in general, is to expand on the world stage, working in all possible jurisdictions. That is why the more countries, the better.

Also, the main thing when choosing a site for basic (you can call it that) trading – the simplicity of transactions. At Bitcoin Global P2P buying and selling are done in the same way. The order is as follows: register, create an ad, top up your wallet, send the details to the buyer, send the cryptocurrency to the buyer, and if desired, leave a comment at the end of the transaction. That is, there is no need to be afraid of the simplicity of the order of actions.

To understand whether a marketplace is safe, pay attention to the additional fraud protection tools it provides. For example, on Bitcoin Global P2P, each user is rated. It is created based on the feedback after the transactions. It is recommended, of course, to choose highly rated sellers/buyers.

To prevent scammers from making money on you, the project performs escrow. Funds are frozen on the platform until a particular buyer sends payment. In this way, the risk of transferring funds and not receiving your cryptocurrency is reduced to zero; the risk of not receiving payment after the assets are transferred to the customer’s wallet is also reduced. As a rule, other similar platforms deposit funds as well.

The ability to connect two-factor authentication, the function of viewing the history of logins should also be provided by the platform. At the same time, additional recommendations may be provided. For example, Bitcoin Global cautions about Tor Browser. In general, a reliable P2P should pay as much attention to security as possible.

Finally, commissions. The P2P structure stipulates that no commissions should be charged if transactions are made between users of a particular platform. And if cryptocurrency or fiat is sent to third-party wallets, the amount of commission should be displayed immediately when the transaction is processed. In addition, as Bitcoin Global warns, for example, its size also depends on how busy the network is. If an OTC marketplace says otherwise, it can be categorized as “suspicious.




Kevin Doran

I have been trading forex since 2015. Over the past few years, I have tried and tested all the most popular Forex Brokers. I publish my reviews to help you choose a reliable broker and reduce your risks.

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