futures, forex, or <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-cryptocurrency/">cryptocurrency.

/n

It&rsquo;s recommended for beginner traders to use paper trading as a way to <strong>learn market strategies</strong>. They can put forward <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-digital-asset/">virtual assets</strong></a> and perceive how they behave in the market. They receive real data about the simulated transactions, which they can use to build their own strategy and learn to manage risks before stepping into the field.</p>\n<p>The main downside of simulated trading is that the traders have access to unlimited capital. Getting used to limitless assets can lead to the traders developing bad habits in the real market.&nbsp;</p>\n<p>There can also be a disparity between emotions experienced in paper trading and on the real trading floor. During a simulation, a trader may feel relief after experiencing a loss because no real assets were affected. On the other hand, seeing a successful simulation that yields a profit can instill <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-fomo/">FOMO (fear of missing out)</strong></a>.</p>\n<p>The issues related to paper trading can be avoided by limiting the time spent working with simulations and observing real-life trading outcomes. It&rsquo;s recommended to simulate scenarios that are as close to real-world trading as possible to achieve beneficial outcomes.</p>\n<h2>Paper Trading Platforms</h2>\n<p>Paper trading can be conducted using <strong>different methods of varying accessibility and result replicability</strong>. It&rsquo;s possible to simulate trading using pen and paper if the trader has sufficient data.</p>\n<p>However, digital trading platforms are far more advantageous as they are simple to use, provide accurate data, and can simulate real market conditions. Digital paper trading platforms allow users to place a simulated buy or sell order at a chosen time.</p>\n<p>The traders can then observe market performance and outcomes and determine their gains or losses as they would in real trading.</p>\n<h3>Binance</h3>\n<p><a href=https://www.bitdegree.org/"https://www.bitdegree.org/crypto/goon/binance/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>Binance</strong></a> is one of the biggest <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-centralized-exchange-cex/">centralized cryptocurrency exchange platforms (CEXs)</strong></a> in the world. Among its services, Binance also offers users simulated trading. Traders can use <strong>real-time prices</strong> for paper trading, which allows them to receive valuable, accurate data without putting their crypto assets at risk.</p>\n<p>In addition to market simulations, users can also build trading bots with the spot exchange testnet. Users are required to hold at least one Binance Coin (BNB) in their Binance account to access the testnet features. This was developed as a measure to avoid spam.</p>\n<h3>TradingView</h3>\n<p>TradingView is a social network and charting platform that offers a range of market analysis tools and financial instruments like indicators, <strong>multi-timeframe analysis</strong>, and <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-are-candlesticks/">candlestick&nbsp;pattern recognition.</p>\n<p>TradingView allows users to engage in paper trading with detailed metrics, projections, and in-depth analysis. It&rsquo;s recommended for <strong>experienced day traders</strong> as the interface may be too complicated for novices. TradingView paper trading can be used to simulate <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-day-trading/">day trading</strong></a>, stocks, or crypto trading.</p>","level":"hard","meta_title":"What is Paper Trading? 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phone phishing. They usually call their victims and offer, for example, extended warranties on antivirus software, services, or <strong>products</strong>, ask for charitable donations, or even suggest free vacations.</p>\n<p>Also, criminals attempt to force people into giving money by using fear tactics and various threats. Usually, they <strong>attack vulnerable individuals</strong>, for example, immigrants, and threaten them with fines, arrest, or departure. To force victims into responding spontaneously, phone phishing schemes also include ultimatums or urgent warning messages.</p>\n<p>In <strong>the United States</strong> alone, phone phishing tactics have cost around <a href=https://www.bitdegree.org/"https://public.tableau.com/app/profile/federal.trade.commission/viz/FraudReports/TrendsOverTime/" target=\"_blank\" rel=\"nofollow noindex noopener\"><strong>$30,7 million in losses</strong></a> in 2021. 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As a result, it's often known as a fixed exchange rate.</p>\n<p>Pegging is something that is utilized to <strong>give structure to a currency</strong> by targeting its value at a predefined ratio in order to add a unique and more stable currency.</p>\n<p>When it comes to pegged money in the <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-cryptocurrency/">cryptocurrency world, <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-stablecoin/">stablecoins are the current type of pegging. A stablecoin is a cryptocurrency whose value is tied to a real-world asset, such as <a href=https://www.bitdegree.org/"/crypto/learn/crypto-terms/what-is-fiat/">fiat money.&nbsp;</p>\n<p>There are numerous initiatives that use stablecoins, and they serve a crucial purpose in an industry that is recognized for its significant price fluctuation. Stablecoins make it simple to transfer crypto coins into fiat currency. 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A modest divergence from the norm might also result in severe anticipatory attacks.</p>","level":"easy","meta_title":"What is Pegged Currency? Definition & Meaning | Crypto Wiki","meta_description":"Pegged Currency meaning: Pegged Currency - describes the process by which a country links or pegs its exchange rate to another currency, group of currencies, or other monetary indexes.","meta_keywords":null,"language":"en","created_at":"2022-03-24T15:16:53.000000Z","updated_at":"2022-05-13T14:32:23.000000Z","preview_url":"https://www.bitdegree.org/crypto/learn/crypto-terms/what-is-pegged-currency"},"currentChapter":"P","currentSection":"what-is-paper-trading","chapterTitle":"P","readingLevel":"hard"},"url":"/crypto/learn/crypto-terms/what-is-paper-trading","version":"cdd198d50cbe5c9c21c9329d7c096ffc"}" class="container-fluid d-flex crypto-book p-0">

Crypto Terms: Letter P

What is Paper Trading?

Paper Trading MEANING:
Paper Trading - the practice of simulating trading on a virtual platform without using real assets.
Hard
3 minutes

Let's find out Paper Trading meaning, definition in crypto, what is Paper Trading, and all other detailed facts.

Paper trading, also known as simulated trading, is the practice of simulating trading in a virtual transactional environment without using real assets. Traders can use applications and software, as well as physical bookkeeping methods, to conduct paper trading.

Paper trading can be used to analyze real-life trading processes and outcomes. However, traders do not need to put their capital at any real risk. Furthermore, the trading scenarios generated by paper trading are hypothetical scenarios that can be applied to a range of financial instruments, such as stocks, bonds, futures, forex, or cryptocurrency.

It’s recommended for beginner traders to use paper trading as a way to learn market strategies. They can put forward virtual assets and perceive how they behave in the market. They receive real data about the simulated transactions, which they can use to build their own strategy and learn to manage risks before stepping into the field.

The main downside of simulated trading is that the traders have access to unlimited capital. Getting used to limitless assets can lead to the traders developing bad habits in the real market. 

There can also be a disparity between emotions experienced in paper trading and on the real trading floor. During a simulation, a trader may feel relief after experiencing a loss because no real assets were affected. On the other hand, seeing a successful simulation that yields a profit can instill FOMO (fear of missing out).

The issues related to paper trading can be avoided by limiting the time spent working with simulations and observing real-life trading outcomes. It’s recommended to simulate scenarios that are as close to real-world trading as possible to achieve beneficial outcomes.

Paper Trading Platforms

Paper trading can be conducted using different methods of varying accessibility and result replicability. It’s possible to simulate trading using pen and paper if the trader has sufficient data.

However, digital trading platforms are far more advantageous as they are simple to use, provide accurate data, and can simulate real market conditions. Digital paper trading platforms allow users to place a simulated buy or sell order at a chosen time.

The traders can then observe market performance and outcomes and determine their gains or losses as they would in real trading.

Binance

Binance is one of the biggest centralized cryptocurrency exchange platforms (CEXs) in the world. Among its services, Binance also offers users simulated trading. Traders can use real-time prices for paper trading, which allows them to receive valuable, accurate data without putting their crypto assets at risk.

In addition to market simulations, users can also build trading bots with the spot exchange testnet. Users are required to hold at least one Binance Coin (BNB) in their Binance account to access the testnet features. This was developed as a measure to avoid spam.

TradingView

TradingView is a social network and charting platform that offers a range of market analysis tools and financial instruments like indicators, multi-timeframe analysis, and candlestick pattern recognition.

TradingView allows users to engage in paper trading with detailed metrics, projections, and in-depth analysis. It’s recommended for experienced day traders as the interface may be too complicated for novices. TradingView paper trading can be used to simulate day trading, stocks, or crypto trading.