Why Social Trade Should Be the Future of Trading

The term 'Social Trade' made its debut in the late 2000s alongside the discussions on Facebook, MySpace, and Digg. Those social platforms provide a space where people can share their opinions on politics, investing, and social trends, as well as interact - live - with one another.

The first ever social trading platform was established in 2010, although a system of automated trading signals, which is similar to Telegram groups or Twitter accounts delivering daily signals, was already introduced in 2005. Around the same time, there already existed another form of trading, also based on the trading signals or collective actions of a group of traders, but the adopter would have to use algorithms to generate his/her best strategy. That is called Mirror Trading, and it involves such a great deal of technical setup that it's hard for the majority to follow.

Younger generations are most likely to 'do their homework' from experts on Instagram or YouTube, now TikTok as well. Still, there are no vetting criteria to discern the motivation of these professionals. There has been an urgent need for a transparent background check, and just like that, Copy Trading swooped in and lowered the entry barriers for avid but less equipped traders. This concept, which also falls under the Social Trade umbrella, gives users the option to simply duplicate another trader's orders and conveniently change the trade parameters at will. It's easy to get used to, time, and cost-effective, hence capturing individual traders' interests, flocks after flocks.

A forecast by Research and M arkets shows that the global Social Trading market is expected to double its size by 2028, implying a Compound Annual Growth Rate (CAGR) of 7.8%.

Source: Research and Markets

That covers all types of assets from equities, commodities, derivatives and crypto and all regions from North America, Europe, Asia Pacific (APAC), the Middle East Africa (MEA), to South America (SAM). North America accounted for the highest number of users in 2021, but APAC is eating into the market share of other regions with an expected CAGR of 10%. Retail traders, unsurprisingly, make up the better part of this market, proving the effectiveness of social willpower.

Let's start by asking the question: Why do people love social media, and in particular, Social Trading? More often than not, we use social media as a platform to tell our personal stories: successes, failures, and what we've learned along the way. That's why we expect others to keep it real and come to the wiser for advice when possible. Traders can double-check the price signals by referring to others, finding the most appropriate entry price commensurate with personal appetite. If the majority trades one asset, you can either follow the herd or speculate on its downfall. Sometimes, community is the most reliable source of information.

Twitter is widely known as the sanctuary of traders. The latest insider news, rumors, and screenshots of transactions can all be found there, so maybe we can find the answers we need there. Social Trading brings that humane interaction to trading platforms, therefore earns the trust and appreciation of lay people. It's the higher probability of success, or at least the lower likelihood of making a mistake - we learn from the mistakes of predecessors - that allows an average trader to get the knack of the market faster. It will naturally lead to more self-confidence in even complex fields like trading.

Social Trade is also appealing because it embodies real transparency. Before copying any trader, you can investigate their public profile, together with their verifiable trade data. For example, this is what you can find on Bitget One-Click Copy Trade:

Their order history and trading data are updated in real time and open for all to examine.

Forex Social Trading is the story of 10 years ago; now it's time for Crypto to be in the spotlight. The main barriers to crypto investment include lack of knowledge and transparency. The learning curve can be somewhat smoothed out by the abundance of data and discussions stemming from Social Trading, whereas transparency should be of no problem as exchanges will constantly verify the number to ensure data is accurate.

Bitget has already become an unstoppable force that brings crypto trading to everyone around the world, both the banked and the unbanked, the experienced and the unskilled, whilst eliminating the language barrier between crypto enthusiasts. Trading isn't meant to be horrendous; it does take some time to get used to, but we are making sure that you'll never be alone and helpless on this journey.

Because the gist of Social Trading lies in the realization of a win-win result.