Cryptocurrency has been making waves in the trading world in the past few years. If you are thinking of making an investment and growing your money, this could be one of the options for you. However, there are a lot of strategies you need to learn when you’re trading. You can read great crypto currency trading tips via Learn to Trade or you can do some networking so you can talk to experts and pick their brains. Those who are into trading like talking about trends and strategies so you will learn a lot from them.
Why You Should Start Trading in Cryptocurrency
The average American saves less than 5% of their disposable income. Cryptocurrency trading can significantly change this as long as you take the time to learn everything you can about trading. Investing your money will make you become more financially independent in the future. There may come a time when you no longer have to go to a 9-to-5 job sooner than you expected.
What to Know about Cryptocurrency Trading
Before you go ahead and create an account on trading platforms, there are a few things you need to learn:
- The cryptocurrency market is volatile. There is no perfect strategy when you’re trading in cryptocurrency. The trick there is to trade only using top cryptocurrencies such as Bitcoin and Ethereum. By doing this, your chances of losing all your cryptocurrencies in one night is minimal. It could still happen, but the chances are very low.
There are cryptocurrencies that have lower market caps, but could potentially earn you more in a short time. The catch is that owning these coins is riskier.
- Trading in cryptocurrency is different from stock exchange. If you start trading using cryptocurrency, you can’t use these coins to trade in a traditional stock exchange. You can’t buy shares and bonds using these coins.
- Short-term trading is possible. Short-term trading is when you buy cryptocurrency and you only plan to hold on to it for a short time, and then sell it when the value is higher than when you bought it. You could hold onto it for days, a few weeks, or a few months. The advantage of short-term trading is that you will have the chance to earn gains at a high percentage.
- Long-term trading is preferred by many. Many cryptocurrency traders hold on to their coins for a long time because they know that the price of the coins will eventually increase in large amounts. This means holding on to the coins for more than a year. When you do long-term trading, you don’t have to worry about trends and reading charts every single day. All you have to do is buy the coins and hold on to them for a few years.
What You Need to Start Trading Cryptocurrency
Now that you have some idea about what to expect when trading cryptocurrencies, here are some things you will need to get started:
- Find an exchange platform. The first thing you need to do if you want to trade cryptocurrency is decide on a trading platform to use and open an account. There are many trading platforms out there so you have to choose carefully as not all platforms are created equal. See if these trading platforms allow you to do a trial trade to help you get a feel of the site.
- Choose a cryptocurrency wallet. This is a tool that you use to store and send coins. If you have chosen a cryptocurrency to trade, most likely, it has its own cryptocurrency wallet. For example, if you choose Bitcoin, it uses the Bitcoin Core Wallet.
- Start buying coins. As mentioned, if you’re a beginner, it may be more practical for you to start trading coins with high market caps. There are new cryptocurrency coins in the market that are not as stable as coins such as Bitcoin or Ethereum. Bitcoin has been around for many years now and the price today for one coin is significantly higher than its price more than five years ago.
- Sign up in a different platform. If one platform is not working out for you, you should not hesitate to open an account in a different one. Sometimes, a trading platform is too complicated, while others don’t have 24/7 customer support. You should trade on a platform where you’re comfortable and that you trust.
Cryptocurrency trading is different from fiat exchange. If you’re familiar with the traditional fiat exchanges and you want to trade in cryptocurrency, you will need to start reading more guides if you don’t want to lose your investment. Cryptocurrency is highly volatile so depending on what kind of trader you want to be, you will need to get your hands on as much information as you can.