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IG should not be allowing Bitcoin trading!

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Due to the risk management processes of IG, it clearly does not allow its customers to trade Bitcoin when they want to. Especially when the price is rising and the trend is extremely strong short term. IG refer to 'wallet risk'. Well they clearly should not allow Bitcoin trading until they can allow their customers to trade Bitcoin when they want to during the morning, afternoon and evening. 

 

Several customers have now posted about their issues of not being able to trade Bitcoin when they want to, when the trend is extremely bullish and IG have responded by giving an explanation as to why quite a few times now.

 

As a result, I no longer trade Bitcoin using the IG platform.

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Dear users, we only allow you to short when the price is going up, just give me your money. Bye.

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This is a copy / paste of the reply found here. I thought it maybe useful for those who are following this thread exclusively. 

 

Hi everyone - I just wanted to let you all know that over the last few days I have been collating this feedback and will be passing it on to the FX & crypto dealing desk, and to senior management. I understand how frustrating it can be to get rejected on a trade and I want to reassure you that we always try and reduce the likelihood of any rejection across our deal execution service. It's in our interest not only from a financial perspective (IG generates revenue based on dealing spread and commissions which obviously requires a successful execution), but also from a customer service perspective.

 

For those who are unaware, let me explain how our cryptocurrency offering works on the back end so you have a clearer understanding of why bitcoin and ether are sometimes 'unlongable' or 'unborrowable'. This has been posted elsewhere on the IG Community, so you have already have read it but I thought it may be useful for people in this thread.

 

When you open a long position on the trading platform that trade feeds into IG's total global exposure for that asset. We do not run a speculative position on any market including bitcoin, ether and other cryptocurrencies. This is important for a number of reasons. First it means that we never have a view of where a market is trading or the direction in which it is trading. It is never in our interest for a stop or limit to be triggered incorrectly, and it is only important that the market actually trades at those levels and that the best execution is met every time basis your stops / limits / orders. We do not reject trades based on the market’s direction, but rather on whether or not our internal limits are met. Secondly, it means that as a company if there is ever a large market move in any one direction, IG will be flat and continue to be able to offer services to our clients. This business model has allowed IG to become a leader in spread betting and CFD trading. 

When there is an overwhelming sentiment on any one asset type in a single direction, IG’s global exposure is likely to move to our maximum risk levels one way or the other. With bitcoin and ether it's common to see a strong speculation in one direction. We can therefore become max long or max short more often than in other markets, and this causes that specific asset to be restricted from trading until we see more buyers or sellers in the market. We have internal limits on many tradable instruments however the liquidity for these are far greater. There are also some unique risks for crypto currencies specifically which need to be taken into account (for example the risk of holding 'x' amount of bitcoin in a wallet). 

I appreciate that this can be frustrating, however it does mean that we can continue to offer leveraged trading on cryptocurrency. We do need to have these limits in place so that our risk levels are kept proportionally adequate to the underlying risk of cryptocurrencies in general.

 

I hope the above clarifies things, and let me just reiterate that all sentiment will be passed onto the relevant parties. We continue to review, refine and improve all offerings at IG, from platforms to deal execution, and we shall continue to do this for our crypto offering.

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