The Process of Trading in Bitcoin
The popularity that cryptocurrencies enjoy presently has made the highly desirable and valuable. There are more investors keen in getting in on this market. But most of them have no idea where to start. Its unique characteristics add to the confusion of how to trade and sell it. Here is a guide that shall help you learn how to trade in Bitcoin and other forms of cryptocurrencies.
You need to start by choosing a cryptocurrency exchange. There are plenty of them out there, each with certain advantages and disadvantages. You need to analyze them by considering their fees and purchase options, supported coins, security, as well as liquidity. These are critical to any exchange you are contemplating. You need to go for one with favorable fees to it. The more the coins trading there, the better the chances of making profits. The security is also critical. You need to see some strong measures in place, such as secure passwords, two-factor authentication, offline cold storage for most of your funds, and professional grade encryption.
It shall thus be time to create a wallet. This is where you will jeep your cryptocurrency safe. There is always a provisional wallet at your chosen exchange, but you should not leave your currency in there for too long. The best place has always been your personal wallet. You need to be keen on the security of your private key. It is the means for you to transact safely. You need to keep any amounts you do not wish to trade with, in the offline storage. You need to then keep that info secure at all times. If you lose that offline info, you will have lost a huge investment permanently. There are hardware wallets for such scenarios. You can find more info on them here.
This shall now be time to buy your first Bitcoin. You can do so after funding your wallet. There are many ways you can do so. There are ways you can use your credit card or bank account to make the purchase. You need to then move them to your personal wallet or trading wallet at a larger exchange.
You can so far go into selling and trading Bitcoin. You should have a plan on how you will do so, and the discipline to see it through. A good habit to adopt is never trading more than 5% of your total stock in one investment move. If the trade does not work out, you will have lost very little.
Never trade with amounts you cannot afford to lose. Investing always comes with plenty of risks. The ups and downs common in other markets are here as well. You need to watch how much you are dealing with.
There are articles on this site you can refer to for investment advice.
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