Cryptocurrency trading is emerging as one of the popular ways of earning passively due to its extremely volatile nature. It is considered the digital gold of the modern era.
But that’s not the only reason why new investors are shifting their focus from traditional assets to crypto trading; there are many more!
The best part of cryptocurrencies is that they are decentralized and operate on blockchain technology, which makes them one of the safest financial instruments to trade-in.
On the other hand, crypto trading can be a great source of income for professional crypto investors, but conversely, it might be quite challenging for beginners.
If you’re new to cryptocurrency trading, here’s a complete guide for you. So, let’s start now!
What is Cryptocurrency?
A cryptocurrency is a virtual or digital currency that is protected by encryption, making counterfeiting and double-spending practically impossible.
In addition, many cryptocurrencies are built on blockchain technology, which is a distributed ledger enforced by a global network of computers.
Cryptocurrencies are distinguished by the fact that they are not issued by any central authority, making them potentially impervious to government intervention or manipulation.
What is Cryptocurrency Trading?
Crypto trading involves buying and selling crypto coins in order to make money from the price movements. Over the last 10 years, since the launch of bitcoins, crypto trading has become a most demanding trading instrument.
Unlike stocks and commodities, the cryptocurrency market is decentralized, meaning it is not regulated nor controlled by any central or financial regulatory body.
Cryptocurrencies trading can be done in a variety of ways. The first option is to buy and sell these digital assets directly on a crypto exchange, while the other option for trading cryptocurrencies is to use derivative financial instruments like Contracts for Difference (CFDs).
CFD trading has grown in popularity in recent years because it requires less capital while also allowing high volume traders to speculate on the current price swings of cryptocurrencies without really owning them.
How To Start Cryptocurrency Trading?
If you’re new to crypto trading and wondering where to start? here’s a step-by-step guide to get started:
Find a Cryptocurrency Exchange:
The initial step for a newbie trader is to find a reliable and reputed cryptocurrency exchange that offers low trading fees. These exchanges offer an easy-to-use platform to sell or buy crypto. You must open a cryptocurrency trading account to trade these digital currencies.
On the other hand, creating a trading account is as easy as opening a bank account. Just fill out the application form and go through the identity verification process.
Make A Deposit Into Your Account:
The next step is to fund your account after you’ve created one. Using debit cards and credit cards, as well as wire transfers, you may add money to your digital wallet with ease.
Select A Cryptocurrency:
Most advanced traders choose bitcoin, ripple, and ether; however, there are many other altcoins you should consider trading in. The reason for choosing bitcoin is that larger cryptocurrencies are more stable than smaller coins.
Altcoins, on the other hand, has experienced a growth of nearly 1000 percent in only a month, making them a viable trading choice.
Select A Trading Strategy:
In cryptocurrency trading, deciding on a trading strategy is crucial. As a result, you may earn big returns in cryptocurrency trading by combining technical analysis indicators with proper fundamental and technical research.
If you’re searching for a crypto trading strategy, you might use automate crypto trading. Trading bots use a system that is meant to offer you the highest potential profits based on your investing goals.
Developing such bots needs an understanding of complex crypto market concepts and a strong knowledge of mathematics and computer science. You can alternately use a day trading strategy.
Begin Trading:
As you’ve chosen the right trading strategy, it’s time to start trading. By using these trading strategies, look out for potential trading opportunities to trade.
If you want to open a long position, you trade at the buy price, which is slightly above the market price. If you want to open a short position, you trade at the selling price – slightly below the market price.
Best Cryptocurrency Trading Platforms:
Opening an account with the best crypto exchange is a wonderful way to trade cryptocurrency. There are two types of crypto exchanges: centralized exchanges and decentralized exchanges.
Ideally, most exchanges work similarly to an online brokerage trading platforms, allowing you to purchase and sell cryptocurrencies and tokens such as Bitcoin, Ethereum, and Dogecoin. Users can deposit fiat currency such as dollars in these exchanges and use those funds to purchase cryptocurrency.
Generally, it’s critical to consider factors like crypto exchange fees, range of supported digital asset, availability of margin trading, taker fees, maker fees, margin requirement, payment methods, and security when selecting the best cryptocurrency exchanges.
Here’s a list of the 10 best global crypto exchanges and trading platforms for Crypto Enthusiasts:
- Kraken
- InvestBy
- Bittrex
- Coinbase
- ABInvesting
- Bitfinex
- WhiteBit
- Poloniex
- Bybit
- Changelly
How To Avoid Cryptocurrency Scam?
Before we invest our time, energy, and money in anything, proper research is essential. In-depth research, study, and investigation can pave the way for understanding the dynamics of this cryptocurrency trading.
Here’s how you can avoid cryptocurrency fraud:
- Beginners need to be cautious about every stepping stone. They should consider noting down their activities in a diary. This exercise enriches their experiences and teaches them a lesson.
- Don’t download third-party mobile apps as there are several risks associated with them.
- Write down all your passwords, URLs, login credentials, and confidential information regarding your crypto wallet.
- As you are new to the game, make sure to invest in the blue-chip or the best prospects.
- Do not store your password on a browser or your login manager or devices that have access to the internet.
- Violating the above step can make you easily fall prey to hackers, so watch out for such hack.
- Long and convoluted passwords are saviors for life. It applies handsomely to everyone.
- To keep up with the first line of defense, take up complex questions and answer them likewise.
- Clean your system before making any transaction on it. A single malware or virus can lead to mayhem.
- Always choose a reliable and reputed crypto exchange.
- Don’t use the same password for all accounts.
Conclusion
If you are a beginner and interested in starting cryptocurrency trading, we recommend you do it now. Never have two thoughts once you decide to experience something new. Research about it, learn from others’ mistakes, analyze, check the trading volumes and get the market knowledge.
Additionally, take expert investment advice from a seasoned trader. Once you understand the basics of cryptocurrency markets, there’s no one to stop you from becoming a successful crypto trader.
