Networks have changed interactions within many industries, from travel and transportation to dating and the media. The trading activity on crypto exchanges was no exception thanks to the introduction of social trading. It implies copying the actions of professional traders by beginners and discussing any issues related to trading.
The reasons for the success of the Crypto Social Trading Platform are explained by the manifestation of network effects. They arise in conditions of mass distribution of some technology, service, or product. In this case, the more consumers use them, the more value this service or product receives. In social trading, the network effect has helped to leverage collective wisdom through the intensive sharing of knowledge and experience.
The Power of Community in Social Trading
Social trading has produced multiple results, including getting more people involved in trading, increasing the popularity of crypto, spreading financial knowledge, etc. However, among other effects, one is worth special attention: it helped to unite disparate atomized traders into a single community. As a result, other consequences began to unfold:
- Intensification of communication;
- Exchange of valuable information;
- Opportunity to get answers from professionals;
- Reducing risks and increasing profits for novice traders.
Amplifying Trading Opportunities through Network Effects
If at the first stages of their development, social trading platforms united a small number of enthusiasts around them, but today, they have turned into large-scale projects that continue to actively grow and improve:
- Successful professional traders received an additional source of income.
- Novice traders got an excellent opportunity to quickly and successfully enter trading.
- Others received a powerful incentive to improve their knowledge and the prospect of applying them in social trading.
As a result, a large number of people who have decided to try their hand at trading have chosen this as their key activity. And this is in sharp contrast to the previous situation, when many new traders left this area after a series of mistakes, losses, and disappointments.
Building Strong Communities in Social Trading Platforms
Thanks to network effects, projects such as NAGA, eToro, Bybit, InvestMates, and others have become effective platforms for sharing knowledge and making money at the same time. And new platforms are already on the way, which take into account the experience of existing ones and offer their unique solutions. BIDSBEE is a next-generation social trading platform expected to launch in the near future. But already now a community is actively forming around Bidsbee on Twitter, waiting for the release of this project and discussing opportunities it brings.
Case Studies: Successful Social Trading Communities
Summarizing the reasons for the success of social trading platforms, it is possible to highlight the key factors that have made a significant contribution to their success:
- The faith of crypto enthusiasts in cryptocurrency projects and the desire to share knowledge with others;
- Collective learning, thanks to which it became possible to analyze each other's strategies;
- Emotional support in case of failure;
- Increasing liquidity, which means opportunities to make profitable deals;
- Exchange of educational materials and experiences.
The development of social trading is not yet complete but is only gaining momentum. And the best proof of this is the emergence of new solutions and platforms such as Bidsbee. Attracting both experienced traders and beginners, they create new principles of interaction based on collaboration and mutual learning.