The Hidden Costs of Crypto Trading: How Order Types Affect Your Price

When it comes to buying and selling cryptocurrencies like Bitcoin, understanding order types is crucial. A market order buys immediately at the next best price available in the market, while a limit order buys only at the price set by the trader, or better.

A stop-loss is not a way of buying, but rather a trigger that sends an order into the market once a certain price is touched. It's essential to understand how these tools work together to determine the final price of a trade.

For instance, if you buy Bitcoin through an app and never check any screens other than the big buy button, you'll end up paying extra in three areas: trading spread, fee tier, and execution itself. This can add up to a significant markup that many investors don't even realize they're paying.

When placing orders, it's also essential to consider market depth, which refers to how much volume sits on each individual price level of the order book. A worked example shows that an order for 1,500 euros may get exactly the displayed price, while an order for 8,000 euros will end up at a noticeably higher average price.