Ready to jump into the lucrative and fascinating world of cryptocurrencies? If your answer is yes, start with these helpful hints to ensure you get started on the right foot.
How Cryptocurrency Works
To fully understand how the system of these virtual currencies works, the easiest way is to draw a parallel with the currency you know and have always been used to handling: the euro.
The euro is a European currency centralized via the European Central Bank. It is the ECB that sets and oversees what is called “the issuance of money.”
At the same time, the euro, like the dollar, the yen, the yuan, etc., is a strong and stable currency because it is precisely supervised, centralized by the banks, the latter also providing you with a kind of guarantee, guarantee of a solvency of the value of this currency.
When you pay with a check or via your credit card, for example, for a purchase, the merchant has the assurance, through his own bank, that he will indeed be paid for the transaction made together because, on your side, your bank (or your visa or American express credit card provider) also provides a deposit and a guarantee of your solvency.
All our purchases and all our transactions are therefore insured and secured by the banking system, which ensures and covers each party bilaterally.
The principle of cryptocurrency is based on the absence of any control body. That’s why we talk about DEFI (decentralized finance). Without all the intermediaries, we gain reactivity; a cryptocurrency transaction is instantaneous. Thanks to the supposed inviolability of the blockchain, it is “almost” impossible to corrupt a transaction.
Day Trading or Long-term Investment?
There are several ways you can try to make profits in the crypto market. The most common ones are day trading and long-term investment. Day trading encompasses many strategies, such as scalping or swing trading.
Long-term investment implies playing on the rise of the asset’s value over a certain period. In other words, you find the crypto you want to invest in and wait for its price to increase so you can reap the profit from it. It’s maybe a more straightforward and less time-consuming way than day trading.
Day trading requires much time spent in front of the computer screen, monitoring the market, and doing tech analysis to make the wisest trading decision possible. Since volatility is the crypto market’s core feature, it offers excellent opportunities for day traders.
How to Get Started With Crypto Trading?
Many traders these days, newbies and experienced ones, decide to go for automated trading systems or trading bots.
These tools don’t require previous knowledge about trading strategy and market analysis. If it sounds compelling to you, make sure to conduct diligent research about available software, Read reviews! For instance, if Biticodes, one of the recent softwares draws your attention, make sure to see what features the tool offers.
Another way is to find a brokerage that offers crypto trading and open an account. It’s highly recommended that you go for the ones that provide free training and tutorials so you can enter the market with basic knowledge about the market and various trading approaches.