In today's digital age, cryptocurrency trading has become a hot topic. In this field, fiat currency trading and currency trading are two key concepts, and the subtle differences between them are worth our in-depth exploration.

In the field of digital currency, fiat currency trading refers to the trading method of directly using legal currency (such as US dollars, euros, etc.) to purchase cryptocurrencies. This trading method directly connects real-world currencies with cryptocurrencies, providing users with a more direct and simpler way to purchase. For example, when you buy Bitcoin with US dollars, this is a fiat currency transaction.

In contrast, currency trading refers to the trading method of directly using one cryptocurrency to purchase another cryptocurrency in the cryptocurrency market. This trading method does not involve traditional legal currency, but completes the transaction through the exchange between digital currencies. For example, buying Ethereum with Bitcoin is a currency transaction.

So, what is the difference between these two trading methods? First of all, fiat currency trading is more direct and easier to understand because it directly uses legal currency that people are familiar with to trade, which lowers the trading threshold. In contrast, currency trading is more challenging and requires users to have a deeper understanding of the exchange rates and market trends between different cryptocurrencies.

In addition, fiat currency trading is usually more regulated because it involves traditional financial institutions and legal currencies, which are more susceptible to government supervision and regulations. Currency transactions are freer because they are conducted in the decentralized cryptocurrency market and are relatively independent of the traditional financial system.

In actual operation, fiat currency transactions are more suitable for novice users because they can directly trade with the fiat currency they are familiar with, which reduces the difficulty and risk of operation. For users with certain experience in the cryptocurrency market, currency transactions provide more trading options and flexibility, and can better grasp market opportunities.

In general, fiat currency transactions and currency transactions have their own advantages and disadvantages. Which trading method to choose depends on personal needs and risk tolerance. In today's turbulent digital currency market, understanding the difference between these two trading methods can help investors make more informed decisions and seize investment opportunities.

In the world of digital currency, fiat currency transactions and currency transactions are two different bridges connecting the real world and the virtual world. No matter which trading method you choose, you need to be cautious and invest rationally to succeed in this field full of opportunities and challenges. I hope every investor will master wisdom and move forward courageously on the journey of digital currency.

The four most famous international exchanges:

Binance INTL	OKX INTL	Gate.io INTL	Huobi INTL
China Line　APP DL	China Line　APP DL	China Line　APP DL	China Line　APP DL

Note: The above exchange logo is the official website registration link, and the text is the APP download link.

For some investors who are entering the cryptocurrency circle for the first time, fiat currency trading and currency-to-currency trading are familiar terms to us. The fiat currency mentioned here is not the French currency, but the legal tender. The reason why the exchange sets up a fiat currency trading area is that the current policy prohibits the exchange from directly trading in RMB. Users can complete the exchange of fiat currency and digital currency through OTC over-the-counter transactions. OTC fiat currency trading is actually a bit similar to Taobao's C2C platform, where users can trade directly with other users. Many investors still don't know what fiat currency trading and currency-to-currency trading are? If you want to know the difference between the two, let the editor of the currency circle talk about it.

 What are fiat currency trading and currency-to-currency trading?

1. Fiat currency trading

The fiat currency trading here is not the French currency. Fiat currency trading means buying, selling or trading digital assets through legal tender. For example, buying Bitcoin with US dollars, or selling Bitcoin in exchange for US dollars. If investors want to buy other digital currencies, they need to increase their investment, that is, recharging fiat currency and buying other currencies. At present, most trading platforms have separated fiat currency transactions into over-the-counter transactions. Over-the-counter fiat currency transactions are similar to C2C platforms of e-commerce. Users trade directly with users, and the platform acts as a guarantor.

2. Coin-to-coin transactions

Coin-to-coin transactions refer to transactions between digital assets and digital assets only supported by the trading platform, mainly for transactions between virtual currencies and virtual currencies. Generally speaking, there are not many types of cryptocurrencies that can be directly traded with fiat currencies. The most common ones are BTC, ETH, or special cryptocurrencies such as USDT and BitCNY that serve as "fiat currencies" in the circle. If you want to buy other types of cryptocurrencies, you need to exchange them with BTC, ETH, and USDT in the exchange, which is the so-called coin-to-coin transaction. Compared with the fiat currency transactions of traditional blockchain trading platforms, coin-to-coin transactions can reduce the cost of currency exchange and are more convenient and quick. In a sense, coin-to-coin transactions can give full play to the utility of funds.

 What is the difference between fiat currency transactions and coin-to-coin transactions?

Most of the digital asset transactions we usually come into contact with are priced in RMB (CNY) for digital assets such as Bitcoin and Litecoin. Then, when RMB is used to price Bitcoin, a BTC/CNY trading pair is formed (when one asset is used to price another asset, a trading pair is formed). The price of this trading pair represents how many units of RMB are required to buy 1 unit of Bitcoin, or how many units of RMB can be obtained by selling one unit of Bitcoin.

So, what if Litecoin is priced in Bitcoin? In other words, how many Bitcoins is one Litecoin worth? Coin-to-coin trading refers to exchanging one digital asset for another digital asset. For example, when BTC is used to price LTC, a LTC/BTC trading pair is formed. The price of this trading pair represents how many units of BTC are required to buy 1 unit of LTC, or how many units of BTC can be obtained by selling 1 unit of LTC. For example: when the website opened on August 18, 1LTC=0.0099BTC, that is, one Litecoin is 0.01 Bitcoin.

Traditional digital asset trading is the exchange between digital assets and RMB (CNY). When buying Bitcoin with RMB, if Bitcoin rises, you can use Bitcoin to exchange for more RMB, otherwise the convertible RMB will become less. For example: when 1BTC=30,000 yuan, buy 1BTC, and wait for Bitcoin to rise to 40,000 yuan to sell, 1BTC can be exchanged for 40,000 RMB (CNY).

In OKEx currency-to-currency trading, BTC is equivalent to the position of RMB. For example: when 1ETH=0.1BTC, buy 1ETH with 0.1BTC, and wait for ETH to rise to 0.2BTC to sell, 1ETH can be exchanged for 0.2BTC.

The above content is the detailed explanation of the editor of the currency circle on what is legal currency trading and currency-to-currency trading and what is the difference between legal currency trading and currency-to-currency trading. Compared with legal currency trading, currency-to-currency trading can reduce the cost of switching currencies, and can also provide investors with arbitrage opportunities within the platform. Currency-to-currency trading will also have stronger anonymity and more convenient conversion and circulation between digital assets. The market price of currency-to-currency transactions changes according to changes in market supply and demand forces. If the buyer's power is greater than the seller's power, the price of the trading pair will rise, otherwise the price of the trading pair will fall.