6 Tips To Help You Get Started With Cryptocurrencies.
Cryptocurrencies are becoming a more popular asset class in terms of asset volume and demand. Since the introduction of Bitcoin, the cryptocurrency market has seen exponential increase in the number of cryptocurrencies as well as its users across the world.
This is due to a variety of factors, the most notable of which is its extreme volatility, which allows it to provide a return not available in other sectors. Volatility, on the other hand, also causes significant losses.
See also: 16 Cryptocurrency Facts You Should Know.
While Bitcoin is still relatively new, its acceptability has grown considerably since 2009. The decentralized nature of Bitcoin has piqued the interest of Millenials and aided it in becoming what it is today. Trading cryptocurrency appears to be the new trend, with less bother and the use of modern technology. The rapid ascent to wealth, the dramatic loss in fortune, unpredictable trading, and skyrocketing growth trends all point to cryptocurrencies being the next big thing.
However, before you make a trade, you should research the sort of cryptocurrency you want to trade, how to trade these currencies, and how to select an acceptable trading platform.
Types Of Cryptocurrencies
With the ever-expanding market, over 1000 different varieties of cryptocurrencies exist. On the other hand, Bitcoin is the oldest and most popular cryptocurrency to date (BTC). You may have heard about how bitcoin trading ushered in the digital era. Some of the other cryptocurrencies are as follows:
• Ethereum(ETH)
• Bitcoin Litecoin (LTC)
• Ripple(XRP)
• Zcash(ZEC)
• Monero(XMR)
• Tether(USDT)
This list is non-exhaustive. You can find out about other currencies on Coinmarketcap.
If you are new to cryptocurrency trading, you should concentrate on the most active and popular cryptocurrencies. It is preferable, to begin with the well-known and then branch out once you have obtained sufficient market knowledge.
See also: How do cryptocurrencies work? Beginner’s Guide To Cryptocurrencies.
What exactly is cryptocurrency trading?
Trading cryptocurrencies entails buying and selling cryptocurrencies on a trusted and well-known platform. To purchase or sell cryptocurrencies, you must first open an account on one of the trading platforms. Then, convert your fiat currency to the cryptocurrency offered on the platform and complete the transaction. The currency can then be stored in your wallet.
How do I pick the best crypto trading platform?
Before trading cryptocurrencies, you must first select a reputable trading platform. While there are many options available, you must choose the one that best meets your requirements. However, before you decide on one, you should consider the most fundamental factors which include:
1) Safety
Select a platform with high security. Please take note of the number of security features they use. These include requesting ID verification, 2-step phone verification, amongst others.
2) Variety
The platform must support a wide range of coins. Check out the exchange rate and compare it to other platforms as well.
3) Credibility
Examine the platform’s credibility by reading the comments and evaluations of users who have used its services. You can also look into their Reddit, Facebook, Twitter, and other social media platforms.
How do I start trading?
You’ll need to select an appropriate trading platform once you’ve decided on the cryptocurrencies you want to trade. Before reaching a final decision, you need to conduct extensive research on selected assets. You must also open an account with the platform you have chosen to trade. You can start trading after you have completed the verification and other requirements.
Bitxmi, for example, is one of the trading platforms that has grown in popularity since its launch in 2018. By working with ChainUp, the trading platform has concentrated on improving security and architecture to the highest standards.
- Bitxmi enables users to acquire cryptocurrency using fiat currency via their credit cards.
- The security of the cold wallet, private key management, and the use of many servers are all prioritized.
- Bitxmi also employs a slew of techniques to ensure that no fraudulent activity occurs on the exchange.
Studying Graphs and Charts
If you are new to trading cryptocurrencies, then technical analysis and complex jargon are bound to leave you baffled. But, it is essential to know about the various charts and graphs related to the rise and fall of crypto.
At first glance, it seems impossible even to grasp the concept. But, as you study and spend adequate time understanding the various graphs and charts, you will find it comparatively easier.
Some of the charts, graphs, and terms that you must know are listed below.
• Dow’s Theory
• Japanese Candlestick Diagrams
• RSI (Relative Strength Index)
• Technical Analysis
• Strength
• Resistance
- Cryptocurrency Market Capitalization
6 Tips To Keep In Mind When Trading Cryptocurrencies
If you are certain that you want to begin investing in cryptocurrencies, here are six pointers that can help you in your journey:
1. Devote time to learning and training.
It is critical to understand what we are going to invest in to understand the benefits and dangers that we are assuming. You do not have to choose an asset because it is trendy, but because we understand it and feel it will have a bright future in terms of utility and performance.
2. To begin investing, select a reputable platform.
Do not be swayed by “unknown” exchanges or schemes that promise enormous benefits or quick riches.
3. To begin, use Bitcoin and Ethereum.
These two assets are the most popular in the market. It is recommended that these cryptocurrencies make up the majority of your portfolio and that you diversify with other alternative cryptocurrencies.
4. Only invest what you can afford to lose.
When trading cryptocurrencies, only use the money you don’t need in the near or medium term. Furthermore, it is advisable to invest little first to become acquainted with the market. With time and adequate knowledge, you can increase your capital and portfolio.
5. Think long-term. Invest for the long term.
Do not sell at the first sign of a drop or panic. The market’s history demonstrates that long-term investors are always right and more profitable.
6. Keep your cryptocurrencies safe in a cold wallet.
It is the most secure method of storing them; you will be safeguarded against potential hackers or the failure of the investment platform.
Conclusion
While still in its infancy, the cryptocurrency industry is here to stay and holds enormous potential. Due to the lack of consumer protection legislation, the dangers involved with cryptocurrency trading are particularly severe.
Trading in cryptocurrency has created a slew of unexpected billionaires. However, before spending your hard-earned money, you should exercise extreme prudence by conducting extensive research. Also, before making any investments, keep in mind that the market is quite volatile.
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