How to Trade on Binance? (A Comprehensive Guide)

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How to Trade on Binance? (A Comprehensive Guide)

In this guide, we go through how to trade on Binance – everything from adding funds to crypto trading strategies. Let’s dive in!

What is Binance?

Binance is a well-known cryptocurrency exchange in the crypto market. In 2017, Changpeng Zhao founded this exchange which turned out to be one of the largest crypto exchanges and crypto trading platform globally with its headquartered in the European Isle of Malta. In such a short period, it has grown to dominate the crypto exchange and crypto trading market. It is one of the most liquid crypto trading platforms with an average daily turnover of about $2 billion, with approximately 1.4 million transactions being processed per second.

Getting Started on Binance

Before you start trading, you must first register and pass the KYC policy. The registration process on Binance is fairly straightforward. Here’s how to register a Binance account.

You can create an account using your email address or mobile number.

Binance account creation
  • Step 2: Enter the account verification code sent to your email or phone
Account verification
  • Step 3: Verify your account

You may start trading cryptos on Binance once you have registered your account. Account verification is not mandatory. The non-verified account holders on Binance are Level 1 accounts, and their accounts are limited since they can only withdraw up to 2 BTC within 24 hours.

Level 2 accounts are verified accounts. Verified Binance accounts can withdraw up to 100 BTC within 24 hours. To verify your account, Binance requires the following information:

  • Government-issued ID or Passport
  • Name
  • Nationality
  • Age
  • Gender
  • A selfie of you holding your ID. This is part of their KYC and AML procedure
Country selection

You can also upgrade your Binance account to Level 3. This is done by contacting the customer support team and asking them to upgrade your account.

How to Deposit on Binance?

Once you are registered, you have to deposit funds into your account before trading. Note that Binance accepts crypto or fiat currencies. To deposit or withdraw funds, go to your Binance dashboard and click on the “Wallet” tab and select “Overview” from the drop-down menu.

Binance wallet

Click on the “Deposit” tab, where you’ll get the option to either deposit via crypto or fiat, or to buy crypto using your debit or credit card or buy crypto from the Binance P2P trading platform.

Deposit funds on Binance

Select “Deposit Cash” if you want to deposit fiat currencies. There are more than 60 fiat currencies available for the deposit from the drop-down menu. Each available fiat has its recommended method of deposit.

If you want to deposit crypto, select the “Deposit Crypto” tab. Note that you can only deposit each crypto through the available networks indicated. After selecting your preferred crypto, select the network that corresponds to the network you are withdrawing the cryptos from.

Here’s an example of how to deposit Bitcoin on Binance.

  • Select BTC from the drop-down menu
deposit bitcoin
  • Select the network from which you are depositing from. This means that the public chain network type you are withdrawing from must match the one supported by Binance deposits. In this example, when depositing BTC to your Binance account, it must be from the following networks: BTC, BEP2, BEP20 (BSC), ERC20, or BTC (SegWit). These networks also depend on the options provided by the crypto wallet from which you are depositing. For example, if the external wallet only supports BEP2, you must BEP2 as the deposit network.
  • Copy the deposit address provided by Binance and paste it on the platform you are depositing/sending cryptos from. Alternatively, you can scan the QR code provided.
  • The arrival of your deposit will depend on the blockchain network used. When depositing BTC, it takes 1 to 3 min on average.

How to Withdraw on Binance?

Withdrawing means transferring funds from your Binance wallet to an external crypto wallet or account. You can withdraw cryptos or fiat from Binance.

After selecting “Overview” from the drop-down menu under the “wallet” tab, click on “withdraw”. You can select to withdraw fiat or crypto.

When you select the fiat tab, choose the preferred fiat currency from the drop-down menu and the method of payment you’d prefer. Binance supports transfers to credit card, debit cards, direct bank transfer, cash balance, or mobile money. These options vary depending on the selected fiat and where you are.

Withdraw funds on Binance

Input the amount you intend to withdraw and follow the subsequent instructions.

Withdrawal confirmation

How make Bitcoin withdrawals on Binance?

Here is how to withdraw BTC from Binance:

  • To withdraw crypto from your Binance account, select the crypto you intend from the drop-down menu, in this case, BTC. Note that you can only withdraw cryptos from your spot account. Thus, if you intend to withdraw from other Binance accounts, you must first transfer them to your spot account.
  • Enter the address of the external wallet to which you intend to transfer the cryptos. Binance will automatically match the address you enter to a network that uses a similar address format. However, you should review this information to ensure it is accurate.
Withdrawal notice
  • Confirm the withdrawal amount and ensure that you have sufficient funds in your account to cover the withdrawal fees as well.
  • Finally, confirm the details of the transaction and click “Submit”.
  • Binance withdrawal time can range from 30 minutes to a few hours.

Available Order Types

Whether you are going long or short, Binance offer traders four order types – limit, market, stop limit, and one cancels other (OCO) orders. These order types can be used in the spot market, with margin trading, or in the Binance futures market.

How to Trade on Binance Using Limit Orders?

Limit orders execute a particular trade at a specified price or better. With Binance buy limit orders, traders can opt to go long on a particular pair when its price asset reaches a specified level that is lower than the current market price.

Sell limit orders allow traders to short the crypto pair when its price reaches a specified level that is higher than the current market price.

How to Trade on Binance Using Stop-Limit Orders?

Buy stop-limit orders allow traders to automatically execute long trades when the price of a pair reaches a specified price higher than the current market price.

Sell stop-limit orders allow traders to enter into short positions when the price of a pair reaches a lower target price than the current market price.

How to Trade on Binance Using Market Orders?

With the market order, traders can go long or short depending on the current market price of a crypto pair.

How to Trade on Binance One Cancels Other (OCO) Orders?

These orders are submitted to the market in pairs. They are either competing or opposing orders. Thus, when one order is filled, the other one is automatically cancelled.

How does Binance Work?

Binance originally started as a crypto exchange platform. Over time, it has morphed into a crypto trading platform offering both spot and futures trading.

Binance offers four distinct trading platforms:

  1. The crypto exchange platform (Convert)
  2. The classic platform
  3. The advanced platform
  4. The P2P platform

How to Trade on Binance Crypto Exchange Platform?

When comparing Binance to Kraken or other platforms, this is the simplest crypto trading platform – it is also called Binance Convert & OTC Portal. This platform is specifically designed for the spot market. This means that you outrightly own the cryptos you are exchanging and no use margin or crypto leverage. Users can easily convert their cryptos without worrying about complicated aspects of trading, such as order books and trading fees.

Here’s how it works.

Once you buy or deposit cryptos into your Binance account, you may want to convert them into other cryptos, whether for transactional, investment, or speculative purposes. Say, for example, that you have 1000 USDT, and you want to convert into BTC. You simply select the crypto you want to convert from the drop-down menu and enter the amount you wish to convert.

Select BTC from the next drop-down menu and click on “Preview Transaction”. This will compute the amount of BTC you receive and also show you the exchange rate for USDT/BTC.

convert OTC Portal

Note that when trading on the Binance crypto converter portal, the minimum amount per trade must be the equivalent of 10 USDT. Trades are settled directly into your Binance account’s spot wallet immediately you confirm a trade.

How to Trade on Binance Classic Trading Platform?

Trading on Binance classic platform supports spot and margin trading. The classic platform is dynamic and helps the trader get a quick overview of the market and switch easily between the different crypto and fiat currency pairs.

crypto to fiat chart

This platform also displays the order book for the selected crypto pair to the left. It is separated into two, the top section which shows ‘Asks’ – the price traders are willing to sell at – at the top and ‘Bids’ – the price traders are willing to buy at – at the bottom. The middle section shows the real-time price chart of the selected pair – you can switch between the original Binance chart TradingView chart. To the right, the platform shows the market list of all supported tradable pairs.

At the bottom-centre of the Binance Classic trading platform, just below the real-time chart, is the trading section.

Here, you can select whether to trade in the spot market or use leverage. You can also choose the type of trading order – limit order, market order, stop-limit order, or one cancels other (OCO) order.

After selecting the type of order, you wish to trade, enter the volume you intend to trade on either the buy or sell section. You can manually enter the volume you intend to transact or select a percentage of your account balance to be used in a particular transaction.

spot trading binance

How to Trade on Binance Advanced Trading Platform?

The experience of trading on the Binance Advanced Platform is similar to that of the Classic Platform.

The two platforms’ primary differences are the layout and the fact that the advanced trading platform offers traders more charting tools. The market book, order types, and the type of trades are similar on both platforms.

trading chart binance

How to Trade on Binance Peer-to-Peer Trading Platform?

Trading on the Binance P2P platform involves buying and selling cryptos directly to other users on the platform. The platform lists all the available users selling cryptos along with the quoted price. You can also sell your cryptocurrencies on the Binance P2P trading platform.

This platform provides the most convenient way of buying and selling cryptos directly to willing sellers and willing buyers at an agreed-upon price. Note that you must complete your account and SMS verification before trading on the Binance P2P platform.

binance p2p platform

Here, you can filter all the available crypto sellers by entering the amount you wish to buy, your preferred fiat currency, and your payment method.

After you have identified your ideal seller, click on “Buy” and proceed to complete the transaction as per the instructions and within the time limit.

Once the transaction is completed, the cryptos will be deposited in your Binance P2P wallet. You can then transfer the cryptos to your Binance spot wallet to start trading. The same process can be used to sell cryptos on the Binance P2P trading platform.

Binance P2P trading is not available in the US, the Republic of Belarus, The Democratic Republic of the Congo, Cuba, Iraq, Iran, North Korea, Sudan, Syria, and Zimbabwe. For more information regarding this can be found in our detailed Binance review.

How to Trade on Binance with Margin?

Trading on Binance can be done in the spot market using a cross or isolated margin. With Binance margin trading, users can borrow funds that significantly increase the volumes they trade. Traders have to create a margin trading account to create leverage for both long and short trades. In Binance, traders can use across (3x leverage) or isolated (10x leverage) margins.

The funds you have in your Binance spot wallet can be used for margin. First, you transfer them to your margin account.

cross margin

After you have deposited into your margin account, check on “borrow”, which allows you to perform auto-borrow trades, and trade on margin.

margin trading binance

You can repay the borrowed amount when closing your trade by selecting “repay”. This auto-refunds the borrowed amount.

Crypto Trading Strategies

Hedging spot trading with options contracts

Binance has recently introduced the trading of vanilla options contracts. These are crypto derivatives that give the contract holders the right but not the obligation to go through with the specified transaction. The option holders can buy or sell a specified tradable asset at a pre-determined price at a future date.

Traders can use options contracts to hedge against potential losses from the spot market. Call options are used to speculate that an asset’s price will increase and put options bet on the price of an asset dropping.

If a trader is short in the spot market but anticipates a bullish trend, they can buy call options. If they are long in the spot market and anticipate a bear trend, they can use put options to hedge against the possibility of a bearish trend. Check out an alternative list of crypto derivative exchanges for comparison.

Crypto HODLing

This is a crypto investing strategy which involves buying and holding crypto over a long period. The long holding period allows for the crypto to appreciate over time. HODLing ignores the short-term price fluctuation.

Trend trading

Short-term crypto traders can use a combination of technical analysis tool available on Binance to establish and trade various trends in the market. This involves using trend and momentum indicators to determine different crypto patterns, including reversal and continuation patterns on different timeframes.

We hope you find this article informative and understood ‘how to trade on Binance’. There are many other credible crypto exchanges like Binance offering great services. To learn more about exchanges that can be used as an alternative to Binance, keep watching this space.

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