In an announcement yesterday, Bitstamp has announced that clients can now trade Euros for Dollars, marking the bitcoin exchange’s entry into the biggest traditional currency trading pair in the foreign exchange market.
Bitcoin exchange Bitstamp has entered the largest and the most liquid trading market in the world, Forex, by enabling EUR/USD trading for its clients.
The foreign exchange market sees over $5 trillion in trading every day, easily dwarfing the likes of the Futures and the Equities market. That’s an average of over $200 billion, every hour.
While the forex encompasses all world currencies, a few major currencies stand out as the most traded pairs. The US dollar makes up the majority of Forex transactions and the EUR/USD pair is unsurprisingly the most traded pair, due to the USD itself and the Euro, a currency backed by multiple member countries on a platform of easy trade.
The average daily trading in the EUR/USD stood at $241 billion, nearly double that of the next closest trading pair in USD/JPY. Amid market turmoil last year, the EUR/USD pair saw its heaviest volume since 2010, underlining the relevance of the two biggest currencies.
Bitstamp’s endeavor into the forex market to enable EUR/USD trading could prove to be substantial for cryptocurrencies. Traders and companies that routinely hold and transact with USD and the Euro now have an additional platform wherein they gain access to digital currencies.
With its announcement yesterday, Bitstamp stated:
We are excited to announce that our clients can now use our new EUR/USD trading pair. The new trading pair allows for better mobility of funds and new arbitrage opportunities.
Headquartered in Luxembourg after acquiring its license, Bitstamp had previously enabled bitcoin purchasing via credit and debit cards for users in Germany and Italy earlier this year.
The European exchange, which will soon become the first fully licensed bitcoin exchange in Europe – following a license granted by EU member Luxembourg – joins fellow European digital currency exchange BTC-e in offering EUR/USD trading.
While it isn’t the first bitcoin exchange to introduce the all-fiat trading pair, Bitstamp’s license to operate as a payment institution across all 28 countries of the European Union will serve a far wider audience.
BItstamp will charge a flat fee of 0.20% for EUR/USD trading. In comparison, BTC/USD and BTC/EUR trading sees fees between 0.10% to 0.25%, depending on the volume of currency traded.
The minimum allowable trade for any currency in the platform is $5.
Featured image from Shutterstock.
Last modified: May 21, 2020 10:23 AM UTC