The Bitcoin to HUF currency pair can be particularly attractive for those who like to trade a combination of BTC and a currency of an emerging economy. While BTC has a higher level of volatility, the HUF has lower volatility compared to some other emerging currencies. Accordingly, trading BTC to HUF may offer the opportunity for making some profit especially when it’s augmented with the leverage.
If we exclude the effects from unexpected events such as the coronavirus, which had an abnormal impact on the financial markets, the BTC to HUF chart displays a daily movement in value of around 5 per cent. In addition, on a yearly basis, the BTC/HUF pair may experience wider movements. Hence, the Bitcoin to HUF can provide trading opportunities for different trading styles and preferences, which makes this pair popular.
Since its introduction in 2008, Bitcoin has had a significant impact on the financial markets and on trading. Despite the scepticism related to BTC in the early years, it is now one of the most actively traded cryptocurrencies in the world. Bitcoin is a base or quoted currency in tens of currency pairs with a daily trading volume reaching tens of billions of pounds.
The supply and demand for Bitcoins have a major influence on its price. The cost for mining Bitcoins also affects the value of BTC, in a way that higher costs would imply that BTC value should increase or mining would be unprofitable. The number and strength of competitive cryptocurrencies and the number of currency exchanges which quote the BTC can positively or negatively impact BTC value. Moreover, different regulations and legal issues can affect the value as it was evident in the past.
Hungarian Forint or HUF was established in 1946, in a post-war era as the national currency of Hungary. The Hungarian Forint enjoyed a rather stable exchange rate until the early 1990s when the process of transition towards market economy took place. However, today the HUF is a fully convertible currency which indicates that it can be traded without any limitations set by the monetary authorities such as the Central Bank.
The Hungarian economy is characterised as open and export-oriented with some of the major trading partners coming from the EU such as Germany, Italy, France, Romania, Italy and so on. Few of the most important industries in Hungary are manufacturing of vehicles, automobile parts, tourism, electronics, information technology and medical technology. Consequently, factors which have an effect on the individual industries or the overall export levels may cause fluctuations in the HUF value. In addition, changes in the economic and political conditions in the EU will certainly have an impact on the HUF and respectively the BTC to HUF exchange rate, because a big portion of Hungarian exports is made toward EU countries.
Changes in economic or financial indicators or changes in the supply and demand will also affect the BTC/HUF exchange rate and the overall value of HUF. Namely, a large public debt can have an adverse influence on the value of the domestic currency. Additionally, when trading Bitcoin to Hungarian Forint keep an eye on the political situation in Hungary, as there were politically driven situations that had some influence on economic conditions as well as on the HUF strength.
Also, traders should monitor the developments in the Hungarian Government plans to become part of the European Monetary Union and replace the Hungarian forint with the euro.
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