Crypto trading is basically making an exchange of one cryptocurrency for another involving buying and selling coins along with the exchange of fiat money into crypto. Do you know about forex or foreign exchange? Crypto trading is quite similar to that where fiat money is traded throughout the day from across the world.
However, this article deals with each and every point an expert crypto trader takes a look at a trading platform.
The Evolution of the Crypto Realm
In recent years plenty of cryptocurrencies came into being, and the count is still increasing. Estimations have revealed that today the world has got more than 1500 existing cryptocurrencies. These coins can be obtained by the usage of a leading cryptocurrency like Bitcoin (BTC) or Ethereum (ETH).
For this, you have to work on trades in order to donate to initial coin offerings or ICOs in short. Or, you can also use the services of a blockchain firm. There are benefits of crypto trading, among which the best one is that you may get yourself involved in coin mining. This is a great perk as mining coins takes a long time, technical know-how, energy, and huge computing power.
Buying Crypto is Quite a Process – Have a Look
For making crypto purchases, you have to come across platforms known as crypto exchanges, which are of mainly two kinds. The first one is called centralized crypto exchanges, and the second one is known as decentralized crypto exchanges.
Centralized Crypto Exchanges
The centralized is where you can keep funds and exchange BTC’s likes for other tokens and coins. Kraken, Binance, and Coinbase are good examples of centralized exchanges.
Decentralized Crypto Exchanges
On other hand, decentralized one means where there is no middleman. It simply signifies that the trading is automated and peer to peer. Some good examples of decentralized crypto exchanges are IDEX, OasisDEX, and Bitshares.
One good thing about decentralized platforms is that they put more pressure on privacy, which makes you capable of protecting your identity with more steps. Always be careful about the case that by any chance you get rid of your private keys, it makes your funds unrecoverable even though you possess complete control of your cash through your own personal wallet.
The Proper Approach for Storing Your Crypto Assets
Now, you might be looking for an ideal place to store each and every bit of your crypto asset. Well, this depends on your priorities.
For “Hot Wallets”
“Hot wallets” allows you to access your digital assets quite easily. It grants you to transfer your funds and quickly complete trades quite easily.
For “Cold Wallets”
On other hand, these wallets are stored offline. Usually, it is stored in USB sticks, with some folks even writing down on paper their private keys. “Cold Wallet” can be more useful in case you are thinking of saving crypto for a rainy day.
There is something more you have to give some thought on what you desire to store in your crypto wallet. Being interested in trading might make you end up owning multiple cryptocurrencies at one go. Some wallets are developed to support only a single category of crypto coins.
Things that You Should Look for While Purchasing a Crypto Coin
Being a member of the crypto community, you must be aware of the fact that each and every cryptocurrency is very different from others, be it in terms of value or its purpose. Therefore, you should go for detailed research before finalising a crypto purchase. Not all cryptocurrencies have gained fame, just like Bitcoin and Ethereum.
These 2 crypto assets are now used in the mainstream very prominently. However, popular ones can also face price volatility, and it can be very hard to predict the price fluctuation. Always be careful about each and every update, including the changes in price. Therefore, gathering as much information as possible is pretty necessary.
Also, in case you are willing to sell your crypto, always be sure that you are selling at higher and upper limits, diminishing losses in the event of a crash and protecting profits after a surge.
There are a Bunch of Mistakes the Newbies Do, and You Should be Careful About
- It is good to have a diversified portfolio, just like any other typical conventional investment and spreading threats. In this way, if one cryptocurrency performs awfully, it will not have a disastrous effect on your assets’ total value.
- Another very important trick is that you can try and determine “the reason” for the value of specific crypto going up or dropping before you go for any investment. Purchasing a coin whose value is dropping and waiting for the value to rise again may seem shrewd. However, no one can guarantee that it will be bouncing back.
- Going after profits by backing a swept currency may look very alluring. Nonetheless, keeping in mind that there is always a high chance of pump and dump strategies where the cost drops afterward.
- Another tip, in this case, is that you should always keep an eye. You can even double-check or check more while trading. This is nothing to be left unfollowed. While you are setting up buying or selling orders, you have to be sure that your numbers add up. It is because even the tiny little typos can make you lose a pretty attractive sum.
- The last point regarding the mistakes you should avoid states that you should always be sure that you are sending coins to the proper destination while dealing with a crypto exchange.
So, what do You Think is the Best Way of Learning Crypto Trading?
In order to gain mastery in this field, getting attached to a group of mentors or a community, you are having strong faith in is absolutely worth it. It should be good to start by opting for a trustworthy exchange and dealing with popular crypto coins such as Ethereum (ETH) or Bitcoin (BTC).
But, for those who want to learn quite rapidly might face problems while learning by this approach and can be quite slow. If you start integrating with a community of like-minded crypto dealers, it will be one of the best decisions as there are hundreds of groups on Telegram or systematic meetups in various countries like the US and others.
There are various resources acting as blockchain investment platforms that connect novice crypto investors and traders with experts in the industry. Such a platform’s main aim is to make a user learn to take decisions on their own investment, aiding the crypto novices to deal from the position of knowledge.
Because of the distinctive character of digital currencies, crypto trading offers some unparalleled benefits. Transactions with conventional currencies are quite full of menaces compared to the digital assets transaction.
Trading cryptocurrency or playing with Bitcoin gives you plenty of plus points. These are inclusive of user autonomy, discretion, peer to peer focus, low transaction payments, even for international payments, prevention of banking fees, accessibility, and mobile payments. Dealing with crypto is actually quite a safer path as it has very fewer chances of fraud or theft in comparison with any conventional trading.