Crypto trading is the future of finance. In its present stages, it has a considerable number of users as well as people looking to trade cryptocurrencies. There are platforms for such purposes and you might be looking to understand how they work and learn how to ride the wave of crypto trading.
But you’re new to the scene and this doesn’t have a problem. To be better prepared for crypto trading you’ll need to go over the basics and learn some things. This article will give you a solid foundation you can build on.
The first thing you need to get straight is the definition of cryptocurrency. This is a virtual currency as it only exists online. But it has value and with that value, you can buy goods and services from companies that accept this currency as a payment method.
This requires a transaction to be made between the 2 parties. There are 2 keys that are needed for each transaction. The public one is there to initialize the link and establish the connection between the 2 parties. The private one is there to confirm it and record it on a virtual ledger. This is also the key that gives you access to your assets and as such, it needs to stay private.
There are many benefits to using crypto. Anonymity is one of them and this keeps you safe from all manners of online threats. Moreover, when you have crypto assets you’re their sole owner and no third party has insight into your account. In addition to this, you can also swap cryptocurrency for fiat currency if you want to. These are the benefits that put cryptocurrency on the spot when it comes to keeping your finances safe from third parties.
But the one perk of cryptocurrency is the profit potential. In addition to this, you’ll need to learn about volatility as it’s an element tightly knit to profit potential. In other words, the value of an asset can rise and drop over a short period.
So, as a beginner, you should consider buying your first asset when the value is low. If you’re looking to sell, then wait for that value to go up. This is a common practice in crypto trading and as soon as you start you’ll learn of other ones.
But before you do so, you’ll need to find a platform, create an account and find a wallet to store your assets. These are processes that every crypto trader needs to go through.
The Platform Process
There are several different kinds of trading platforms out there. Some focus on a variety of assets while others focus on crypto only. You can go for either kind of platform as long as it meets your needs. Your best bet is to go for the best trading platforms as they will have the right features needed. They will also have a variety of customers that are satisfied and you’ll need to find out why by going over the customer reviews.
The most important thing to go over is the history of the platform. This will show you if the platform has had any hacker attacks in the past. If this happens to be the case, then it will be better if you found another platform. Online threats are no joke and hackers could steal your assets by attacking a platform.
A clean history will give you a better sense of security and once you’ve found such a platform then you can make an account. Deposit some funds into it because you’ll need to buy your first asset. But before you do that you’ll need to find a wallet as this is crucial to any crypto trader.
The Wallet Process
Once you know the gist of these currencies and you’ve found a platform, then it’s time for a wallet. Starting with the popular ones is a good idea because they will have the right features and tools, as well as a large client base which means they must be doing something right. Go into these features and see if they’re worth your while.
There are 2 kinds of wallets out there and these are the hot and cold ones. The hot ones are connected to the net and this makes them convenient as you can access your assets any time you’re looking to trade. But this also puts you in danger because of hackers roaming online looking to steal your assets. Naturally, some hot wallets will have better security measures than others.
Then there are the cold ones and they are named so because they don’t share a connection to the net. They serve as cold storage for your assets and are immune to online threats. In short, you should go for the wallet that suits your needs.
With a wallet by your side, you have all you need to start your journey as a crypto trader. You can buy your assets and start trading any way you see fit. With time, you’ll become a skilled trader.