5 Things I Wish I Knew Before Trading In Crypto
You may have heard this a thousand times but consistent discipline in crypto trading is the key to profiting. From avoiding emotional trading and putting all your eggs in one basket to DYOR and thinking long-term, staying calm and clear-minded in a volatile market can earn you huge profits.
But that’s not all.
In order to triumph in crypto trading or investments, there are several common myths and unspoken rules in crypto trading that you as a newcomer (or even as an experienced trader) need to understand.
By knowing and taking precautions, you might save yourself from crypto traps and lose your investment money! Now, let’s get started.
- “I Need To Buy A Whole Bitcoin”
The first one on the list: many believe it’s pointless to invest in Bitcoin if you can’t own the whole coin, but that’s absolutely wrong.
Don’t have the funds to buy the whole coin? Buying a fraction share of Bitcoin will do as the fractional share will increase in value as Bitcoin’s price rises.
If you’re aiming to own one whole Bitcoin, it’s possible through an accumulation strategy where you purchase Bitcoin whenever the price dips, allowing you to gain more fraction of the crypto in a discounted price.
2. “The Higher APY, The Better!”
If something sounds too good to be true, it probably is.
While there are many crypto exchanges offering high yield staking subject to high market risk, you should watch out for platforms that promise outrageous APY returns that go up to 1000% or even more.
Staking is when you lend your coins for a certain amount of time and in return, you will be rewarded with double or even more of the coin.
High staking APY sounds tempting, and scammers know that. That’s why many scam projects try to lure potential victims with fake promises. Once their victims are hooked, they will lock the investment and make sure it’ll never see the light of the day.
Most of these projects also suffer from poor tokenomics where they have unlimited supply of coins and billions of coins in circulation, causing the coin to be extremely volatile.
3. “All Traders Have Access To Info Equally”
Have you ever heard of insider trading? It’s when some traders have the privilege to access certain stock or crypto news and events before it is out in public.
Let’s take Changpeng Zhao, the CEO of Binance for instance. Binance is the world’s largest centralised cryptocurrency trading exchange and they add new tokens to their systems on a regular basis. Before the coin goes live, they will make announcements, airdrops, and other means which cause the price of a token to go up dramatically before and after its debut.
Now, Zhao (and probably a few other Binance employees) are aware of the listing before the rest of us and therefore they have the ability to purchase those tokens for a very low price and then sell them at much higher prices after the coin is listed.
A friendly reminder that some influential people are aware of news and events before you are, which will give them the power to manipulate the market.
4. “Buy The Rumour, Sell The News”
This saying refers to the phenomena of profiting from a coin in anticipation of rumours and then selling profitably once the news is released.
Related: Dogecoin crashes as Elon Musk appears on ‘Saturday Night Live’
This trick isn’t always a guarantee of success because of the proliferation of fake news in the crypto market. While this works with ETH2.0 or smart contracts coming to Cardano, be careful of small-cap coins and their shady, unreliable news.
5. “You Can Trust Your Funds With Exchanges”
The Mt. Gox heist is a prime example on why you shouldn’t completely trust your funds with exchanges. No matter how established a crypto exchange is, there are risks involved when you place your coins on exchanges.
When the market fails, it is likely that exchanges will crash as well. When that happens, platforms may purposely block off access to users to prevent money from leaving the platform.
Also, most crypto-crimes involve hackers stealing from major cryptocurrency exchanges, which is why it’s recommended that you store your funds in a cold wallet if you are not actively trading.
The Altimate Crypto Guide
Interested in knowing the latest cryptocurrency updates and trends? Altimates is the best platform to go.
Arbitrage trading can be zero-risk with Altimates leading you through the way. In your perilous journey to reap a fortune, let Altimates be the one to guide you forward.
For more about Altimates, check out the links below:
Facebook: https://www.facebook.com/OfficialAltimates/
Telegram: https://t.me/Altimates_Group
Website: http://altimates.com/
