The basics of cryptocurrency trading?
Cryptocurrency trading is a novel and exciting way for business developers, brokers, traders, entrepreneurs and everyone else to turn a profit and get a slice of this new and thriving market. The Bitcoin has an average price of 8226 USD since the beginning of 2018, while Ethereum (Ether) is following with an average of 545 USD.
However, in order to begin trading, you must first understand the mechanics of cryptocurrency trading, which is the part we will focus on in this section of the guide.
The first thing you need to appreciate is accessibility. Once upon a time, the exchanges were closed to everyone else, other than the elite in the business and their stockholders. Today, with the cryptocurrency market, it is the direct opposite. In fact, online exchange platforms dealing with cryptocurrency changed the rules for the better and made room for everyone to participate. You just need to familiarise yourself with the provisions of the exchange before you start trading.
- Step 1 - Obtain a cryptocurrency wallet
- Step 2 - Find an online exchange
- Step 3 - Start trading
The finesse of the trade itself can be a bit overwhelming, but for now, let’s concentrate on how cryptocurrency trading works. You buy Bitcoins on an online exchange, and then you sell them for Litecoins or Ether.
All the while, you are following the trends to see when it is the appropriate time to repurchase some of them or sell them, according to the new price on the market. The principles of trading are the same as with fiat currencies, and the end goal is to make a profit.
Trading with Bitcoin cryptocurrency
The most famous crypto of all is the Bitcoin cryptocurrency, and it is the doorway to any cryptocurrency trading platform. The demand for Bitcoins is continuously increasing, and its volatile nature makes it the perfect coin for trading, especially since the opportunity for profit is parallel to the risk.
What was once called “momentum” back in 2010, when the Bitcoin first gained popularity, now is a booming market with approximately over 18 million traders around the world.
Let’s take a look at the statistics for a moment — there are around 12,000 transactions per hour involving Bitcoin, and 80,000 Bitcoin tweets sent per day. The popularity and the financial gains of Bitcoin cryptocurrency trading are undeniable.
According to the Cambridge Center for Alternative Finance, the Bitcoin is creating its economic ecosystem supported by other cryptocurrencies, fulfilling an array of functions hat correspond to the traditional exchanges.
The cryptocurrency wallet?
The first step towards trading is obtaining a cryptocurrency wallet, where you would store all of your cryptocurrencies. It is imperative for you to have a digital portfolio because the software program saves your public and private keys and interacts with the Blockchain technology that creates the blocks containing the information about your ownership.
There are a lot of different cryptocurrency wallets, but you can read more about them in that section of the guide.