Trading cryptos, especially Bitcoin, is all the rage for the past few months. Even Elon Musk had to spice it up recently by investing in Dogecoin, saying it’s for his newborn son, and of course, Bitcoin (making a commotion on the market).
Since December 2020, everyone wanted to get into crypto trading, especially when celebrities announced they were becoming traders. The whole Bitcoin rush started back in summer 2020 when a big company decided to invest in “the future” by buying Bitcoin. Later, other investors joined, and that’s how we got the result in December – Bitcoin hit its highest cap ever, and it continued to rise, despite volatility.
If you are still here, it means you are interested in cryptos. You might be thinking about getting into crypto trading yourself, but you’re unsure if you should start. Is it safe? Can you gain profit? Maybe those are just stories. While there are many things to consider and research before starting to trade, yes, it is safe, and you can profit from trading if you are patient and willing to learn.
There are many popular cryptos, Bitcoin being the first on the popular list for a long time, and Ethereum, Litecoin, etc. Just because they are all digital currencies, it doesn’t mean their volatility is the same, so we will discuss ways to trade and what would suit you the best.
A turbulent history
Many would think every cryptocurrency works the same; thus, the same principles and strategies should follow. The truth is the opposite since many factors contribute to the popularity and volatility of Bitcoin, while Ethereum operates differently. Also, Bitcoin is continually fluctuating, but it’s still around 50 thousand USD, and experts predict it will reach $100000 value by the end of the year.
Despite optimistic speculations, there are constant concerns that Bitcoin will crash. Why? Because in 2017, Bitcoin reached a cap of around 20,000 USD and then crashed entirely and quickly. Many invested without even completely grasping what Bitcoin is but wanted to be a part of it because everyone suddenly talked about this digital currency.
While many factors contributed to this event, many disappointed traders were the ones who rushed to open an account and invest everything they can without even thinking about what trading is and how you should approach it. It is why many are skeptical of the current Bitcoin rise.
Strategy difference – long or short?
You should talk about this with your broker and see if it fits your lifestyle and personality. Bitcoin is, for example, far more volatile than Ethereum. Traders consider Ethereum more steady; therefore, it’s an ideal choice if you want to take it slow and go long-term.
Suppose you are more inclined to short-buying and selling (don’t worry, you’ll research and learn about these terms more, and if you are not planning to, we’re saying you should). Look for what seems like less pressure since you don’t want to get overwhelmed at the very beginning of your trading journey. Being calm and the patient is one of the things you will have to (re)learn once you enter the volatile market.
Staying away from scams
You can trade cryptos at Forex, a decentralized trading market that operates on the internet 24/7 (excluding weekends). You will need a third-party (a broker) to open a trading account and start investing, so their credibility is of utmost importance. You can be safe while trading if you know where to search for licensed and certified brokers. It is one of the crucial steps people miss and then complain they got scammed. They are usually too lazy, or it sounds too good even to consider checking if the company is legitimate or not.
Checking broker reviews can immensely help you search for the right broker since you can see their portfolio, what they work the most with, and what they’re like (they usually have more than one platform you can reach them). Check the company by visiting a website that acts as a regulator body, meaning they compile and update their list of licensed and registered brokerages.
This way, you protect yourself from scams and waste your time and money on nothing. Googling up these couple of websites doesn’t take away much time, and people are still too lazy to do it. That’s why you should do this before you even open a trading account. The last thing you want is to have your trading account under the company that steals money. If you checked and they are licensed and have a certificate, you are good to go.
Trading cryptocurrencies can be safe and profitable if you check the company’s credibility that caught your eye. Even if somebody called you, you are not obliged to open an account with them. Check all the info online (their website is not where you should look first, but the ones we mentioned above).
Listening to your broker and telling what you would like to achieve and your schedule is essential for making a sound foundation for successful trading. Being realistic, looking at cryptos as an investment, and being ready to go a long way is what will ultimately help you become a profitable crypto trader.