14 Dec How To Trade Cryptocurrency
A Thorough Guide To Trading Cryptocurrency
It is well known around the World that cryptocurrency is a thrilling market for investors and no one doubts this. However, it is important to note that success is not so easy to attain in the business world. Unfortunately, the cryptocurrency market is not exempted.
Lots of individuals around the globe are deciding to step into the cryptocurrency industry to start investing. This should not be a surprise as the cryptocurrency market capital is about $300bn with more than 1500 coins.
Starting cryptocurrency trading can seem confusing as the process is different from what investors and traders are used to. For those interested in learning about cryptocurrency trading, this guide will help you with everything you need to know.
Select an exchange to trade on
Investing in cryptocurrencies involves having a place to trade these coins. To begin, a trader will need to register and drop some funds into his/her account. From here, buying and selling cryptocurrency commences. There are quite some well-known crypto exchanges available, and they include;
Select a cryptocurrency wallet
With plenty of exchanges available, investors have no choice but to transfer funds by any means necessary and also have where to store their assets. They make use of cryptocurrency wallets. These cryptocurrency wallets are devices that allow a trader store and transfer crypto-coins to and fro.
There are currently various types of cryptocurrency wallets, and they are;
- Mobile wallet
- Desktop wallet
- Hardware wallet
- Paper Wallet
Whenever a trader is done selecting wallets they’ll love to make use of; they are all prepared and ready for trading.
A cryptocurrency trader must always supervise the market information of cryptocurrency. Cryptocurrencies are remarkably unstable assets whose prices are known for increasing and decreasing in high percentages within hours. These occurrences are prompted by a large number of events.
It is important that a trader studies the assets before putting money into a coin. A good website where one can source for information on every coin available is the “Coinmarketcap.” This site can be used to compare cryptocurrencies, and the data needed include; capitalization, trade volume, supply, etc.
Another reliable way to supervise any cryptocurrency-related news is to follow up on blogs and publications that are available in the industry. These publications include The Merkle, Hackernoon, CoinDesk, etc. Another way to source information is through social media such as Quora, Telegram, etc.
CoinMarketCal is also available to source data as it monitors cryptocurrency-related events. The events being tracked are those that can affect the coins traded on exchanges.
Use of Technology
As of now, those interested in trading cryptocurrency are already equipped with not just the knowledge but also tools for trading. But, likened to fiat investment, there are still some elements unavailable for the process.
Firstly, while fiat investors can make use of stock indices as a yardstick while creating a portfolio, similar tools are needed for the cryptocurrency market. An example is the Cryptoindex 100 (CIX100). It is a computerized index calculated via a computer learning algorithm that evaluates cryptocurrencies.
This instrument enables traders to diminish the fluctuations and dangers for their portfolios plus costs and efforts essential in investing multiple coins. After the creation of the portfolio, a trader can monitor coins using various apps such as Blockfolio or Delta. This app provides incredible insights into exchange prices, the order book for every coin, etc.
The use of such an app enhances productivity and lessens risks.
The best way to learn how to trade is actually to trade. In trading cryptocurrencies, you will need trustworthy information sources, research carefully, selects the most reliable exchange and wallet and finally search for yardsticks and tools for the management of your portfolio.
Trading cryptocurrency is profitable if the right cards are played, and with the steps outlined above, you can get started on this amazing journey.