The crypto industry has multiplied ever since it debuted on the global stage twelve years ago. But despite its rapid growth and increasing popularity, most people are still unaware of the whole idea or concept of cryptocurrency.
Cryptocurrency refers to digital money as opposed to traditional banknotes and coins. Cryptocurrencies are monies that you can spend like traditional banknotes, but they are not tangible – you cannot hold them physically. Cryptocurrency rides on the belief that modern problems require modern solutions.
So, have you been exploring the concept of cryptocurrencies for trading or investment purposes or wondering how it can boost finance? This guide is for you. In this guide, we will be looking at five tips for cryptocurrency beginners. Ready? Let’s dive in.
1. Learn From Facts Only
If anything, this digital age has proved to us repeatedly, it is a simple fact that information is knowledge, and knowledge is power. Cryptocurrency is an exciting innovation, so there’s a vast repertory of information on it.
As you start in the crypto world, you need to understand that there are different opinions about cryptocurrencies as there are many people on earth. And it is not possible to adopt every piece of advice people offer you about cryptocurrency. As a cryptocurrency beginner, you must be reliably informed, and one of the best ways to do that is to stick to facts above opinions.
When you finally invest in cryptocurrency, the best way to keep yourself updated is to follow trusted news sources to get the facts. For instance, Cryptoner is a reliable source for every information you need about cryptocurrency.
2. Understand the Market Dynamics
Cryptocurrencies are relatively new, but they have established a reasonable degree of stability in the stock exchange market today. Be that as it may, it is essential to note that cryptocurrencies are still evolving, making it difficult to predict trends and patterns. The market is volatile, so you must be prepared for market crashes and dips as a cryptocurrency beginner.
On the other hand, though, you should also anticipate seasons when the value of the cryptocurrency is unusually high and when you record higher profit margins. Understanding market dynamics, especially its volatility, is a tip you can never outgrow as long as you invest in cryptocurrency, especially beginners.
3. Choose a verified trading platform
Traditional money is the kind of money we can hold physically, such as your banknotes and coins. However, cryptocurrencies are hosted on the internet. Everything cryptocurrency-related is done online. This implies the possibilities of usual data breaches and hacking perpetrated in cryptocurrency as well. To prevent this, you need to use a verifiable platform where you can trade your cryptocurrency.
As a cryptocurrency beginner, you can use a web browser, but it is much better to use a supportable platform in mobile applications. For cryptocurrency beginners, a mobile application allows you to invest in several cryptocurrencies. A mobile app is also safe, and that significantly reduces the risks of fraud and data breaches. Examples are TradeStation, Coinbase, eToro, Kraken, Bittrex, Gemini, and Robinhood.
One popular way to make income from crypto is day trading, often regarded as the most effective way to earn from crypto. But unlike what we think, day trading isn’t merely about holding an asset until its value rises. You’ll need sound technical and analytical skills to navigate this field correctly. It will help you analyze the performance of listed assets as displayed on market charts. Other than that, setting up for day trading is relatively easy — just sign up on your preferred exchange, buy assets, evaluate the asset, and you’re good to go.
4. Keep your cryptocurrencies securely
Banknotes are kept in banks for security purposes, and in the case of cryptocurrency, your coins are stored in wallets. Learning to secure your wallet is arguably the most important tip about cryptocurrency. If your wallet is hacked, you will most likely lose all your cryptocurrency. To avoid this scenario, you must choose the right and secure wallet.
Wallets are categorized into hot and cold wallets. Hot wallets are connected to the internet, and you need an active internet connection to access them from any location. You can move your digital currency quickly, but hot wallets are less secure than cold wallets.
You can download your crypto information on a USB stick and significantly eliminate the possibility of hacking. You have to decide what kind of wallet you will use to secure your cryptocurrency. You might want to consider reading more about wallets on verified sites like Cryptoner and CoinBase.
5. Diversify your Cryptocurrency Experience
Today, there are several types of cryptocurrencies such as Bitcoin, Ethereum, Dogecoin, USDT, etc. As a cryptocurrency beginner, you need to consider the market volatility before making investment choices. It’s also an important factor when deciding which cryptocurrency to buy. This is why you can never go wrong with purchasing several cryptocurrencies together.
This ensures you are against the risks of volatility that come with investing in cryptocurrency. For example, if your investment in Bitcoin suffers a slump, your other assets in other cryptocurrencies will mitigate the losses such recession should ordinarily cost.
More importantly, you should only invest an amount of value you could lose without batting an eyelid. It is not a great idea to immediately invest your entire life savings in cryptocurrencies as a beginner since you are just learning the ropes.
These five tips for cryptocurrency beginners guarantee a smooth journey if followed diligently. Generally, you investing in crypto is very lucrative, but at the same time, you are also liable to lose. Cryptocurrencies are taxable and subject to governmental policies but not directly subject to Central Banks’ policies.
Due to fraudulent activities, most governmental bodies are setting policies to control and monitor cryptocurrency trading. In some countries, trading isn’t illegal but is at the risk of the individual performing the trade. An additional tip is that cryptocurrencies could evolve to become the sole currency in the nearest future. Your investments today will be a decision you will always be proud of.