Can You Paper Trade Crypto on Webull to Practice Investing?

Published: September 19, 2023 | Last Updated: May 20, 2023

Markos Koemtzopoulos

Markos Koemtzopoulos is the founder and main writer of ElementalCrypto. He has been a lecturer at the University of Nicosia on cryptocurrencies and DeFi and has taught two courses on crypto and blockchain technology.

There seems to be some conflicting information online as to whether you can paper trade crypto on Webull or not. Some sites say you can. Some say you can’t. Webull themselves are not very transparent. While they clearly state that they offer paper trading they do not describe which financial products paper trading is available for. To clarify things I reached out to Webull. Here is what they say

The verdict: can you trade crypto on Webull?

According to their email reply, Webull does not currently support paper trading for cryptocurrencies. They say that this is something they might consider in the future.

Can you paper trade crypto reply from Webull

So if you can’t paper trade crypto what can you paper trade on Webull?

Webull’s trading simulator only allows you to paper trade the following products: stocks, ETFs, Indexes, and options.

Simulating trades on the stock market can be a good way to learn to trade crypto.

If you are not familiar with how to trade using a limit order, stop loss order, and market orders then you can get a lot of practice by using a paper trade account.

If you become good at recognizing peaks and troughs then you could use the same strategies to trade crypto.

Why does Webull not offer paper trading for its crypto?

Most likely because the legal entity that manages crypto trading on Webull is a separate legal entity.

Webull Advisors LLC and Webull Financial LLC are regulated by the securities exchange commission (SEC) and are a member of the Securities Investor Protection Corporation (SIPC). This means your funds are insured up to $500,000 when you trade stocks, options, mutual funds, or exchange-traded funds on Webull.

However, your crypto trades are executed by Webull Pay LLC which is owned by Apex Crypto LLC. This entity is not a member of the Financial Industry Regulatory Authority (FINRA) and your crypto funds are not protected.

It also means that they have not figured out how to offer crypto on their paper trading platform.

Alternative platforms that offer crypto paper trading

If you want to practice trading crypto in a virtual environment first then check out the following online trading platforms.

  1. Interactive Brokers
  2. Trading View
  3. Cryptohopper
  4. Coinmarketcap’s portfolio builder
  5. Ninjatrader
  6. 3commas
  7. TradeZero
  8. Coinexx
  9. Bitmex
  10. Plutus Wallet
  11. Paper.Trade

Is it good practice to paper trade before trading with real money?

It really depends. If you want to understand how the mechanics of a trading exchange work then I highly recommend it. Especially if you are a beginner.

Here are the main benefits of practicing with a paper trading account

Benefits of paper trading

  • You can practice trading even if you don’t have money
  • Experienced traders can experiment and test new strategies before deploying real capital
  • You become familiar with the Webull interface so that you don’t make any rookie mistakes when you use real money.
  • New traders can test their skills

However, if you have some experience with trading you should be aware of the following drawbacks to paper trading

Drawbacks to paper trading

  • Your psychology is entirely different when you are pretending to trade vs when there is real money at stake. You will likely be more stressed and emotional when you deal with real money. This is not a small factor. It will greatly influence your likelihood of succeeding in trading. There are whole books written on this.
  • Real-life liquidity is very different from what happens in a simulation. Some users on Reddit complain that their stock paper trading experience was very different from reality when it came to filling orders.
  • You don’t pay fees when you paper trade. This point is relevant if you plan to day trade i.e. to trade frequently. Day traders end up paying a lot in fees. For novice traders, even if you make money day trading you may end up burning a lot of your winnings on fees.
  • You can’t paper trade cryptos or stocks that are not listed on the New York stock exchange.
  • Inexperienced traders may make pretend money paper trading due to chance market conditions and then lose their money when they try to trade with real funds. For example, let’s say you invested in $Pepe just before its price skyrocketed. You might think hey I am pretty good t this. Then when you go and invest real money in a bunch of meme coins you lose everything.

What is Paper trading?

Paper trading is like a stock market simulator. You get access to pretend virtual money and then you can use that to make trades and see what would have happened in real life had you invested real cash.

Most exchanges call these types of accounts demo accounts. They are free to open but you do need to register with the exchange or brokerage to use them.

It is a good way to familiarize yourself with a trading platform or mobile app and get some practice before you invest your hard-earned dollars.

The term originates from when people used to note down hypothetical trades on paper and then waited to see what the result was. Most online brokerage accounts and many crypto exchanges allow their users to test their products via paper trading first.

How to paper trade on Webull

If you want to practice your trading skills with stocks and options here is how you go about it.

Step 0: Open a Webull account

To do this you will need to provide and verify your email. When you sign up with Webull they sometimes give you a stock even if you don’t deposit any money. There’s a 1% chance of that happening so you might get lucky.

On Webull the minimum deposit is $1. However, when you deposit $100 they will give you some free stocks. Then they will continue to entice you to deposit money to get more free stocks.

Step 1. Go to the Webull paper trading interface

After you sign up to Webull you will see any stocks or cryptocurrencies that you have bought with real money as well as any stocks that Webull has gifted to you. But this is not the paper trading interface.

To get to your paper trading account navigate to where it says menu in the bottom right. Then click on the little circles under Shortcuts and scroll to the right. You will find a circle that says ” Paper Trading”. Click on that.

how to find paper trading on webull

Step 2. Start your trading simulation

After you click on paper trading a new window will show that you have $100,000 in pretend money. Now select where it says “Quick Trade” and search for the asset that you want to pretend to buy.

paper trading interface

Step 3: Open a trade

The next screen shows you all the related graphs and data for that asset. Select the order type that you want. The simplest option is to select a market order. If you set a limit order then your order will only execute at your limit price or lower. You can choose to set time-in-force to by a day or good til canceled. If you select day it will cancel your order by the end of the day if your limit price has not been met.

webull paper trade

Step 4. Check your summary

After you submit your order you will see a summary of your buying power and market value. The market value below is 0 because the stock market was closed and the order did not go through. If Webull had a crypto paper trading option then you wouldn’t have this issue because crypto is open 24/7. But notice how the buying power is reduced because I used some funds to buy stocks.

webull paper trade summary

You can check the orders that have not been filled by clicking where it says Open Orders.

How do I paper trade options?

To paper trade options follow the same process as above except click on options trading on the main paper trading interface next to where it says Quick Trade. You can then simulate how rich or poor you could become by trading options.

Tell me more about Webull

Webull is a popular online brokerage that offers commission-free trading with a user-friendly interface.

It is one of the most popular trading platforms with young investors. Webull users are incentivized to deposit funds with bonus offers that offer new users free stocks.

On Webull’s trading app, you can trade stocks, EFTs, options, and cryptocurrencies. You can also trade fractional shares and cryptos.

Webull investors can also trade on a margin account which means you can borrow money from webull to magnify your losses and wins. In my experience, this is mostly about magnifying your losses.

Webull is most popular in the United States but is also available in India, Brazil, Turkey, the Philippines, Malaysia, Japan, China, and South Korea.

In addition to paper trading accounts, Webull also offers a lot of educational resources such as trading tutorials and demos for beginners.

Useful Resources

What Is Webull Crypto Trading: a Comprehensive Review

What is Webull Crypto Trading

If you want to really understand crypto trading on Webull then this is my most comprehensive article that describes all you need to know. Read more.

Will Webull Offer a Crypto Wallet? Get the Full Low Down

Will Webull Offer a Crypto Wallet

Webull is one of the most popular brokerages to trade cryptocurrencies on. Yet one of its major drawbacks is the fact that it does not offer a crypto wallet. This is annoying because it means that you cannot take custody of your crypto like you can with other brokerages such as Robinhood and eToro. However, Webull has announced that it does plan to offer a crypto wallet in the near future. In this article, I will share with you everything there is to know about Webull launching its own wallet. Read more.

What cryptos can I buy on Webull?

webull crypto list

Webull has been offering cryptocurrencies since 2020 but its list keeps getting updates. In this post, I will share with you a comprehensive list of all the cryptos that you can trade on Webull in 2023. Read more.

Webull Crypto Buying Power: What Is It and How Do You Get It

webull crypto buying power

Sometimes when you trade on Webull their terminology can be unclear. What on earth is buying power? Are they trying to gamify the experience or is there something more to this? Let’s find out. In this article, I will walk you through all you need to know about Webull’s crypto buying power. Read more.

FAQs

Can you paper trade when the market is closed on Webull?

When you paper trade Webull will simulate exactly what would happen with a real account. So if the markets are closed you can place your order but it won't go through until the markets open the next business day.

Does Webull have crypto paper trading?

No Webull does not offer demo account for trading crypto. You can only trade stocks, ETFs , options and other securities. You cannot paper trade OTC securities that are not registered with the NYSE and you cannot paper trade penny stocks.

Does Binance do paper trading?

Yes you can paper trade crypto using Binance's Mock trading feature. But this is only available for futures.

Is paper trading risky?

You don't risk losing real money when you paper trade. However it is slightly misleading because it does not reflect the fees you will experience in live trading. Also your psychology and market conditions might differ when you eventually trade with real money. These two factors pose significant risk as they could result in very different outcomes to what you expected.

How do I get paper trade options on Webull?

When you open a demo account on Webull you will see the option to paper trade using options. Click on that to start virtually trading options.

Is crypto a day trade in Webull?

You can decide wether you want your order to be a day order or good until cancelled order when you trade crypto on Webull.

Do I own my crypto on Webull?

No you do not. If you want to own your crypto then you need to send it to a wallet. At the time of writing you can only send BTC, LTC and BCH from Webull to another address. Webull are planning to introduce a wallet that will allow you to own your crypto.

How accurate is webull paper trading?

Webull's paper trading account simulates what would happen in reality. However there are two things to consider. Firstly it does not reflect the fees that Webull charges for live accounts. And second the way that orders get filled will differ in reality especially if you are trading more illiquid assets.

Markos Koemtzopoulos is the founder and main writer of ElementalCrypto. He has been a lecturer at the University of Nicosia on cryptocurrencies and DeFi and has taught two courses on crypto and blockchain technology.

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