THINGS TO KNOW BEFORE STARTING TO TRADE CRYPTOCURRENCY- BEGINEER’S GUIDE

Posted on October 25, 2018

Have you finally made up your mind to invest in cryptocurrency? If yes, a very warm welcome to the world of crypto, a very sensitive and volatile world it is. Starting to trade cryptocurrency can be quite breathtaking and tasking especially if you barely have knowledge of how it works. It is not advisable to invest in cryptocurrency if you’ve not taken your time to study how it works and the possible challenges to be expecting while trading. For cryptocurrency beginners looking to acquire more knowledge about cryptocurrency trading, this article is for you. In this article, we’ll discuss everything you need to know about cryptocurrency trading. Let’s start off by defining cryptocurrency.

What is Cryptocurrency and Cryptocurrency Trading?

Cryptocurrency is a form of digital money that can be used to accumulate wealth. It is used as a medium of exchange in financial transactions. Cryptocurrency offers the most secured way of performing financial transactions. Cryptocurrency uses blockchain technology to store and safeguard information and prevent hackers from accessing the network.

Cryptocurrency trading is the act of exchanging cryptocurrency with another type of currency which is flat currency in most case. The value of cryptocurrency varies from time to time and this is what really prompts its buying and selling. Basically, traders would acquire coin at a particular price and sells when the value of the cryptocurrency increases, from there profit would be made.

How does Cryptocurrency Exchange Works?

Basically, cryptocurrency comes as reward to miners who successfully solve cryptogenic puzzles. It is very difficult to mine cryptocurrency and that’s why traders buy directly from cryptocurrency exchange platforms or from individuals willing to sell theirs at an agreed price. To acquire cryptocurrency, you’ll need a cryptocurrency wallet where you’ll store your coins. Each wallet has its unique address which is what would be used whenever coin is to be transferred to your wallet.

What should be your Capital when Starting to Trade Cryptocurrency

Starting to trade cryptocurrency might require much capital, well, the capital can be flexible. It is advisable to have much capital so as to keep your trade going every time. There is no standard capital required to start trading cryptocurrency though.

Where can you buy cryptocurrency?

Purchasing cryptocurrency requires much care. As a beginner, it is more advisable to purchase your coin directly from cryptocurrency exchange platforms but most importantly, do business with trusted platforms. Also, you can purchase your coin from individuals willing to offer their digital currency for flat currency. This can be quite risky but it’s the most common practices by cryptocurrency traders.

How to choose a cryptocurrency Wallet

As a beginner, choosing the right wallet is very essential. There are important factors to consider when deciding what wallet to choose. These factors include:

·         Security: This is the most important factor to consider when choosing cryptocurrency wallet. Wallets with advanced security option should be your priority as this would give you assurance of safety for your coins.

·         User-friendly: Cryptocurrency trading can be quite complicated. Sending and receiving cryptocurrency requires much effort. Beginners should consider a user-friendly wallet where they can easily send or receive cryptocurrencies.

·         Multi-currency support: Wallets that supports multi-currency is better off for beginners especially for those looking to trade more than one coin with a single wallet. This feature should be looked out for when choosing a cryptocurrency wallet.

·         Reputation: This is also important when choosing a good cryptocurrency wallet. Check online for reviews of popular cryptocurrency wallets and compare them. Select the one with greater recommendation for cryptocurrency newbies.

Best Cryptocurrency Wallets to Choose

There are many cryptocurrency wallets available. As cryptocurrency beginner, it is important that you go for best available cryptocurrency wallets with little complication and strict-free policies. Here is a list of recommended wallets for cryptocurrency beginners:

·         Coinpayment: Coinpayment is one of the most popular and trusted cryptocurrency wallet available. It is a web-based digital currency wallet where several cryptocurrency storage is supported. If you’re looking to trade more than one coin in just a single wallet, coinpayments is an appropriate wallet for that. Coinpayments charges lesser transaction fee. It is also a safer online platform as it has integrated BitGo to provide secure online wallet.

·         Edge Wallet: Edge Wallet is a user-friendly cryptocurrency software wallet. Easily, users can send and receive cryptocurrencies. It also supports multiple cryptocurrencies. This platform is secured with advance security option which makes it so appropriate for cryptocurrency beginners.

·         Blockchain Wallet: Blockchain is known for its strong security option. You can easily send, receive and store cryptocurrencies in blockchain wallet. In addition, it is user-friendly and there is less transaction charges to pay.

·         Coinbase: Coinbase is a web-based digital currency wallet which offers easy accessibility. It supports most of the popular and most traded cryptocurrencies. With Coinbase, you can easily send, receive and store cryptocurrencies. It also features a strong security option.

 

Best Cryptocurrencies to Trade

There are hundreds of cryptocurrencies available. Of course, we investors want to make profit and that’s why we eye profitable businesses. Thinking of what cryptocurrency to trade? Here is a list of best and recommended cryptocurrencies:

·         Bitcoin: Unarguably, bitcoin is the most widely accepted and traded cryptocurrency. It is ranked first in the list of cryptocurrencies.  As a beginner, this is the best option for you. Bitcoin can be used to purchase things online as it is accepted by most merchants as mode of payment. Bitcoin is easy to trade as the supply chain flows well.

·         Ethereum: This is also another well-traded cryptocurrency. It is ranked second after bitcoin. Ethereum have attracted a lot of investors and by record, it has been doing well. This will be a good choice for cryptocurrency beginners.

·         Litecoin: Litecoin is often regarded as the twin of bitcoin. It is the most promising cryptocurrency after bitcoin. It is also accepted by many merchants but not to the level of bitcoin. It is a good option to go for.  

Conclusion

Cryptocurrency is one of the fastest growing technologies. It has recorded a greater number of investors over the years. If you’re looking to invest in cryptocurrency, with this guide provided, you can take a bold step into the world of crypto.