Values of crypto coins are on the rise; in 2017 itself, the value of Bitcoin rose from under $1000 BTC to over $10,000 BTC. This led to a huge explosion in market trading which in turn ensured that the currency kept growing. Trading cryptocurrencies works in much the same way as regular market trading.
However, instead of selling and buying fiat currencies, like the US dollar or Japanese yen, you will sell and buy crypto coins like the Bitcoin, Litecoin, or Ethereum.
While trading in cryptocurrencies however, it is prudent to be cautious because it is possible you may be investing more than you can afford to lose. Trading is an art, not a game, and real money could be lost in the process if you are inexperienced and reckless. So, it is important to know how to trade in cryptocurrencies and do in-depth research on trading.
1. To start with, you need to decide on the platform for trading to happen, once you have money for investment. These portals for trading are referred to as “exchanges” in the world of cryptocurrencies. While there may be many exchanges out there, you have to consider some key factors before choosing one. So, you should ideally make sure that the exchange is readily available where you stay and it has a rock solid reputation. This means verifying how good its security is and whether there is user complaints regarding it. You need to find out about the different exchange rates as rates may vary from one exchange to another. It is recommended that you only select an exchange that demands some kind of identity verification from users; these are a safe bet compared to anonymous exchanges.
2. Secondly, you must learn how to store cryptocurrencies. For this you can opt for hardware wallets or cold storage. The hardware wallets are essentially physical devices for storing cryptocurrencies. They provide high-end security like a cold wallet and make transactions easy and hassle-free. You will be provided with private keys that are completely secure. Such wallets are easy to carry around because of their sleek designs and pin code-protected; even if it falls into wrong hands, your funds are safe and cannot be accessed. Paper wallets are another safe way to store cryptocurrencies; for this, you simply set up an offline wallet using simple instructions and print the public and private keys on paper. When you plan on storing funds for long periods, paper wallets are preferable.
3. You must opt for an exchange to engage in crypto-to-crypto trading. Majority of exchanges permit you to buy only using the Bitcoin. You can choose automated trading applications like bitcoin revolution to trade bitcoins but be aware of bitcoin revolution scam news in the media. Besides Binance, you can consider exchanges like KuCoin, Bittrex, and Huobi. Traders feel that strategies developed in financial markets will hold good in cryptocurrency trading as well, but it is important to do research on each market and take advice from a mentor.
4. Next, you will need to find a cryptocurrency for trading. For this, you must get information about the market cap of multiple crypto coins. You should keep yourself abreast with the latest news and events in cryptocurrency trading. Stay away from scams and false market hype, and ensure that you buy only legitimate assets.
5. Finally, you can start to trade. You need not purchase a whole coin; you can invest in fractions of coins. The top coins are steeply priced and buying fractions make sense. You must also understand that prices are volatile and chances are high that the market may move dramatically, without warning. And finally, you must never invest more than you are ready to lose.
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