Why Choose STP Brokers? STP vs ECN for Crypto Trading

Online brokers that immediately transfer a customer's order to their Bitcoin Liquidity Provider are known as Straight Through Processing. Banks can be among the liquidity providers (LP), which means that there is no middleman in the order processing process. In other words, the Straight Through Processing model does not route trade orders via a Dealing Desk, DD.

STP Online Brokers

Without a middle step (dealing-desk), Straight Through Processing can quickly handle client orders right away without any waiting. This makes STP brokers the best kind to use because they don't change the prices for their clients, which most traders think is very important. Straight Through Processing also lets clients trade when important financial news comes out without any problems.

These brokers do well because they have many sources of money, and having more sources of money in the system means customers get their orders filled better.

Before you read further, notice the difference between these two titles so that the ones below don't seem like repeats.

Reasons why Top Brokers prefer this execution
Reasons why Top Bitcoin Traders prefer this execution

Reasons Why Online Brokers Choose This Model

As the clients places their crypto orders through the Straight Through Processing platform, the orders are then sent directly to the liquidity providers & as such the STP Broker executes trade positions efficiently and quickly thus providing better fills for their customers using this model.

Reasons why traders favor straight-through processing (STP) execution

Clients benefit from superior and quicker execution of their trades employing this methodology.

You get better and quicker results directly from the different offers in the market and sources that provide more liquidity within the bitcoin market, so the client gets the best results.

Client transactions through an STP crypto broker provide anonymity as orders are automatically executed within the interbank market network.

ECN Online Brokers

Electronic Communications Net-work ECN gives traders realtime price information straight from the network of banks that are the Interbank markets.

ECN Crypto Brokers will show the entire bid and ask offers currently available in the btcusd trading market from banks. Electronic Communication Network allows investors to place their crypto orders straight through to the btcusd trading market. Liquidity isn't provided by the broker but by this inter-bank net-work of banks. This way traders transactions through an Electronic Communication Network and thence they can execute trades quickly and instantaneously without getting re quoted.

STP Brokers and ECN Online Brokers Comparison

A recurring question among participants in the market is which execution model is preferable between an STP Broker and an ECN Broker, and what actual distinctions separate the two - a comparison of ECN and STP execution methodologies is beneficial.

STP Broker

STP crypto brokers have numerous liquidity providers but automatically selects the most optimal one at any given moment for the online trader. Consequently, when a trade is executed, the trade orders are directly placed into the inter-bank system.

So Bitcoin STP brokers are like Bitcoin ECN brokers, but the only thing different is that the Straight Through Processing(STP) model picks the best price automatically, at the specific moment when the trade is happening, and it does this automatically for the trader.

ECN Broker

ECN cryptocurrency brokers maintain numerous liquidity providers, which a trader can view concurrently and choose from to execute trades: this is akin to having a selection of 10 different crypto brokers available for trading purposes at any one time.

For true Bitcoin ECN brokers, one must look at many prices at once and pick one: each will have different spreads, and the investor will try to pick the lowest spread among the 10 shown for the same bitcoin chart.

In the business of trading, Straight Through Processing (STP) and Electronic Communication Network (ECN) are very similar. Because of this, some people who trade or companies that offer online trading use these names to mean the same thing. The main difference is that STP quickly shows the best price for trading bitcoin from different places that offer these prices, but ECN shows all the prices that are available at the same time. Then, it is the job of the person investing to look at the prices and pick which one to use to start or finish a trade. If you are a trader, it might be hard to always pick the best price because the market changes so fast.

Reviews say this way of doing things also has a small spread, so if you want a small spread, choosing an STP is a good idea.

Most companies don't want to fill up their workspace with many bitcoin trading numbers from different places because it can confuse traders, especially those just starting out who might not know the differences. Because of this, many online companies might decide to use a type of network for sending information, but only show one bitcoin trading number from a single big bank, which makes them act more like a system that sends orders straight through, instead of a real type of network. But, the way it works is still mostly the same.

If you were to open an account with a Bitcoin ECN crypto broker you would get like 10 quotes of each crypto instrument from different banks and to trade you would have to chose from one of these banks - 10 bitcoin price quotes for every bitcoin chart would make your bitcoin software workspace too crowded. Another thing is that you'd need a more complex bitcoin platform to stream this amount of data, this type of platform wouldn't make the best option to trade with. Furthermore if you open an ECN account you'll have to pay additional commissions on top of spreads. This is also another reason why to choose STP since they don't charge commissions.

Because most brokers are MT4 crypto brokers and they want to make retain the platform as it is which makes it easier to operate and which is why this trading platform software is the most popular/liked, these MT4 crypto brokers will only display the lowest spreads only after mechanically/automatically choosing it using their algorithms, then display and show this low spread alone at all times.

Explanation: STP Brokers Deliver Superior Execution Conditions for Trader Activities

The execution mechanism inherent in STP models ensures complete operational transparency along with quicker and better order fulfillment. This transparency grants the investor access to real-time market data, enabling them to enter the BTCUSD arena directly at the most favorable price available.

Top brokers use this model since it handles client orders fast with no delays. It also skips re-quotes, which Bitcoin traders see as a big plus.

Straight Through Processing(STP)STP offers 24-hour market access with fast execution. It draws from liquid inter-bank partners.

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