Cryptocurrencies have taken the world by storm. They’re decentralized, secure, and anonymous—the perfect combination for online anonymity and privacy. But this comes with a strict caveat: Cryptocurrencies are not regulated by any government or central bank. Consequently, they are also highly volatile. Anyone who owns Cryptocurrencies is therefore exposed to immense price fluctuations regularly. While it can be tempting to cash in an investment when prices are on the rise, this is not a good idea from a long-term perspective.
The main problem with trading Cryptocurrencies is that volatility makes it extremely risky for inexperienced traders. Unless you have a solid understanding of financial markets and how they operate, trading Cryptos is an extremely high-risk proposition that could wipe away your entire investment within minutes if not seconds. But don’t worry—Cryptocurrency trading doesn’t need to be so overwhelming! Here are 5 easy steps to follow if you want to trade Cryptocurrencies safely:
Identify the type of exchange you’re looking for
There are a growing number of Cryptocurrency exchanges that offer different trading types. These include automated and manual trading, as well as decentralized and centralized trading. With automated trading, traders can set up automated trading bots to buy and sell Cryptocurrency whenever the market is open. This saves you a lot of time, but it comes at the cost of increased risk given that you don’t have full control over your funds.
With manual trading, you manually enter buy and sell orders whenever the market opens and closes. This is the safest way to trade Cryptocurrencies, but also comes at the cost of extra time and effort. If you’re new to trading, you might want to try exchanges such as Crypto Genius Pro or Ethereum Code.
Register with a reputable Cryptocurrency exchange
The biggest mistake traders make is not registering with any Cryptocurrency exchange. While it’s possible to buy and sell Cryptocurrencies on regular stock trading platforms like Robinhood, most trading platforms are designed with the specific needs of Cryptocurrency traders in mind. Choosing the right Cryptocurrency exchange is therefore crucial when it comes to trading safely.
A good place to start is by checking out the various Cryptocurrency exchange reviews. You can also sign up for email and/or text alerts from various Cryptocurrency exchanges to stay up-to-date with all their latest promotions. Once you’ve picked an exchange, you’ll need to download the necessary trading software. With the right software, you can conveniently track your portfolio and trade whenever you please.
Find an exchange with low trading fees and good liquidity
Trading bots like Robinhood charge extremely high fees. This is why low trading fees and good liquidity are crucial when picking an exchange. On a trading platform that offers good liquidity, you can easily find and trade your altcoin. This is because high volumes of traders on a particular exchange create a “liquidity pool,” which ensures that your altcoin trades are paired with other orders at the same price.
Avoid all-inclusive fees, which means you only pay trading fees when you trade. Stick to exchange with low trading fees and good liquidity. If possible, we recommend only trading the coins you own yourself.
Buy the altcoin you’re interested in
You’ve identified the type of exchange you’re looking for, found an exchange with low trading fees and good liquidity, and picked an exchange with the lowest all-inclusive fees possible. The next step is to buy the altcoin you’re interested in. The best way to do this is to transfer fiat funds to your exchange’s fiat wallet. Once you have the altcoin safely stored in your exchange’s wallet, you can start trading your chosen coin.
Sell your bitcoin when it peaks or dips
Although you’ve picked the right type of exchange and trading platform, you must be disciplined when it comes to trading. It’s extremely easy to get carried away when prices are rising. But don’t get too excited when they start dipping—this will just tempt you into chasing an easy profit. That being said, the best way to reap profit from trading Cryptocurrencies is to follow a disciplined trading strategy. Simply buy when prices are low and sell when they’re high. This is the most basic and basic trading strategy you can follow. It’s as simple as it gets, but it’s also the most profitable trading strategy.
The Cryptocurrency market is highly volatile and prone to significant price fluctuations. If you want to make money trading Cryptocurrencies, you need to be prepared for extreme price swings and keep your money safe. While it’s possible to make a fortune trading Cryptocurrencies, it’s also extremely risky. To make sure you don’t lose all your money, follow the 5 easy steps outlined above to safely trade Cryptos.