A good trader is rare to find. Honing your chart analysis skills to a degree when you can consistently call yourself a good trader is no easy task. But while the road may be long, reaching the finish line is more than rewarding. You are being paid to be a good trader, and in some cases, crypto exchanges will incentivize you to compete as well.
We may very well classify crypto trading as a sport given how competitive the sector is. Rightfully so, many within the community fight against each other in order to make the most money. Some even build a reputation out of their skills. And in certain cases, traders wish to put their reputations on the line.
Crypto trading competitions are a way to earn money and various freebies by trading cryptocurrencies. Centralized exchanges typically hold such competitions to bring more liquidity or new users to their platform. Today’s article discusses how crypto trading competitions work and how you can participate in one.
What Is a Crypto Trading Competition?
A crypto trading competition is a tournament in which anyone can participate and earn money by putting their trading skills to good use. Trading competitions are often organized by centralized exchanges, who entice traders by offering cash prizes, crypto, discounts, or other types of rewards.
The goal of a trading competition is to earn the highest return on your investment. Depending on the nature of the competition, contestants might have to either trade on real accounts or demo accounts. Keep in mind that the usage of demo funds might heavily impact the effectiveness of traders.
Exchanges hosting such tournaments may enforce a number of requirements for contestants. For example, they might require a minimum amount of funds on their account, or have to meet other qualifications. You might only be able to trade one asset or contract, but perhaps you’re free to trade any crypto you want.
Crypto trading competitions also vary by winning conditions. Reaching the top of the leaderboard might take place by having the highest PnL. Or it may involve having the highest return on investments (in percentages).
Trading competitions typically last for at least a week. However, their duration can vary. A competition can be as short as one day or as long as a month. Exchanges distribute rewards after the end of the contest. In some cases, they may give out rewards on a daily basis – depending on performance.
Benefits of Crypto Trading Competitions
Crypto trading competitions offer many benefits. From earning money to building a reputation in the space, competitions can compound the effects of being a good trader by doubling the rewards – or introducing rewards that aren’t purely money.
Rewards are obviously the number one benefit. Not only do you earn money from your trading prowess, but you also receive additional rewards from participating in the competition. Rewards include cash prizes, crypto assets, NFTs, crypto merch, smartphones, gadgets, cars – you name it.
The other benefit is experience. You can’t know how great of a trader you are unless you put your skill to the test. You can trade on a demo account your entire life thinking you’re a genius, only to find out that you can’t actually trade. Crypto tournaments help you gain experience by trading in practice, and not just in theory.
A side-benefit of trading competitions is the fact that they push you to explore new trading strategies. Remember, you’re not just trading against the market. You’re also trading against highly proficient individuals. You need to find a way to not only outpace the market but these individuals as well. And trust me, it’s not an easy job.
Last but not least, I’d like to talk about another important benefit – one that you should practice in everyday life. Trading tournaments push you out of your comfort zone. They force you to put your reputation on the line, impose limitations on your trading activity, and encourage you to think outside the box. Ideally, this helps you become a better trader.
What Are the Biggest Crypto Trading Competitions?
The crypto industry offers vast opportunities. There’s no shortage of good trading competitions – especially not luxurious ones. Prominent crypto exchanges such as Binance, Bybit, and Phemex, have hosted numerous competitions in the past. Most exchanges hold yearly tournaments, I will talk about some of the most popular ones in the next section.
Binance Futures Grand Tournament
Binance is the world’s largest cryptocurrency exchange, and as such, it makes sense for them to lead the way in crypto trading competitions. The exchange has held numerous tournaments in the past, the most popular one being their Futures Grand Tournament.
Binance’s Futures Grand Tournament is held every year. The last tournament had a prize pool worth $1.8 million. More than 90,000 individual contestants have participated in the tournament. And as you might have guessed, the tournament involved trading futures markets.
Traders had the option to trade alone or in teams. The tournament involved all trading pairs on Coin-M and USD-M contracts. Traders could win multiple prizes and would receive rewards every day. Everyone who participated in the tournament had received a limited edition NFT. The competition’s goal was to win the highest PNL possible.
The World Series of Trade (WSOT) tournament is a highly popular crypto competition held by Bybit. The exchange holds the WSOT twice per year. Bybit’s tournament involved a global prize pool of $8 million. The prize pool was divided into three separate categories.
Six million dollars were distributed to the squad race prize pool for crypto teams. A million dollars were distributed to solo traders. Bybit distributed the remaining million dollars to contestants that participated in the speed zone loot – a time-intensive trading competition.
Other rewards included an ApeX NFT airdrop, increased yields on Bybit’s Earn products, and the chance to participate in a grid bot trading tournament. The tournament lasted from May to August last year.
The tournament had over 69,000 participants from more than 180 countries. Bybit additionally donated $400,000 to UNICEF. The winning condition involved having the highest P&L score (in percentages).
Crypto trading competitions allow traders to put their skills to the test by participating in tournaments and competing against others. Centralized exchanges often hold tournaments to rewards their users, bring more liquidity, or promote certain features. The goal of every competition is to have the highest PnL possible.
Trading competitions are beneficial in the sense that they reward traders who already perform well. They also encourage traders to step outside their comfort zones and think outside the box. By participating in a tournament, you can also put your skills to the test and discover whether you’re actually good at trading.
There are more than enough trading competitions in the crypto space. The two most popular tournaments are held by Binance and Bybit. The WSOT and Futures Grand Tournament are annually-held competitions that are highly popular among traders. Both competitions have distributed multiple millions of dollars in rewards.
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Marko is a crypto enthusiast who has been involved in the blockchain industry since 2018. When not charting, tweeting on CT, or researching Solana NFTs, he likes to read about psychology, InfoSec, and geopolitics.