It’s difficult and expensive to bet against a downturn.The options to short bitcoin are mostly through unregulated exchanges, and very risky given bitcoin’s volatility. “All the options to short in common markets are becoming available in the bitcoin market,” said Charles Hayter, co-founder of market tracker CryptoCompare.
Contracts for Difference One of the most popular ways to short bitcoin is through CFDs, a derivative that mirrors the movements of the asset. “CFD is currently a great market if you want to short bitcoin, especially ahead of that milestone 10K mark, which we think will bring some retracement,” said Naeem Aslam, a chief market analyst at TF Global Markets in London, which offers the contracts.
Margin TradingAnother common way to short bitcoin is through margin trading, which allows investors to borrow the cryptocurrency from a broker to make the trade. Short-margin trading positions on Bitfinex, the world’s second-largest cryptocurrency exchange, were at around 19,188 bitcoins on Monday, versus 23,931 long positions, according to bfxdata.com, which tracks data on the bourse.Borrow to Short BitcoinMost of the brokerages that allow margin trading will also let clients borrow bitcoin to short with no leverage.
This will be a less risky way to bet bitcoin price will fall.Futures Contracts The futures market isn’t as widely developed as CFDs and margin trading, but it’s still possible to make bearish bets on bitcoin with options. The risk is that these notes don’t always trade in line with bitcoin, so the exposure won’t be perfect.Read more on Swiss certificates used to short bitcoinAslam at TF Global Markets said he’s not seeing an increase in demand to short bitcoin.
https://www.bloomberg.com/news/articles/2017-11-27/calling-a-bitcoin-top-here-s-how-you-can-short-the-digital-coin
