Are you wondering how to start crypto trading? This article enlists essential steps that will help you kick off your crypto trading learning journey.
Table of Contents
- What is Crypto Trading?
- How it Differs from Forex Trading?
- Steps on How to Start Trading Cryptocurrencies
- Concluding Lines
What is Crypto Trading?
Interest in crypto trading has been increased over the past few years because cryptocurrencies are extremely volatile assets, and they can give you much higher returns than traditional investments.
We can define Cryptocurrency trading as the act of speculating on cryptocurrency price via buying and selling the underlying coins through an exchange.
As crypto trading gets more mainstream attention, newer players have entered the market and are looking to learn trading techniques.
If you are one of those, who want to learn about trading and the crypto market, you can enroll in a cryptocurrency certification course and become a Certified Cryptocurrency Trader.
How it Differs from Forex Trading?
Forex trading is the exchange of currency into another currency for multiple reasons. It is also known as Forex or foreign exchange(FX). In other words, it is a network that allows buyers and sellers to transfer currency with one another at an agreed value.
The major difference between these two trading approaches is that Crypto trading is more volatile as the markets can fluctuate enormously. Moreover, compared to the cryptocurrency market, forex markets have higher liquidity as a result of a long history of activity.
Steps on How to Start Trading Cryptocurrencies
Let’s explore how to start crypto trading.
Choose Crypto Exchange Platform to Trade on
At present, there are a number of popular crypto exchanges available that can be utilized. If you are wondering what exchanges are, please note that the portals which connect our world to the crypto-worlds are exchanges.
Since each exchange has different terms of services, therefore it is advised to perform a lot of research and go through several reviews. Before selecting an exchange platform, make sure that the exchange is available in your area. For instance, Coinbase, one of the most popular exchange platforms, is not available in India. Apart from this, check the reputation of the exchange. For example, are people happy with their services, is it ever hacked, how secure it is? Most importantly, check for exchange rates. Different exchanges have their own exchange rates, which may vary. If you find satisfactory results, you can finalize one.
Some of the most popular crypto exchange platforms are:
- Cash App and others.
Choose a Crypto Wallet
Crypto wallets are tools that allow you to store and send crypto coins. These are of various types. Let’s explore.
- Hot and Cold Wallets
Internet connectivity defines a wallet in terms of hot or cold. Hot wallets are connected to the Internet and thus are less secure and pose more risks but are user-friendly. Cold wallets, on the other hand, are stored offline and don’t require internet connectivity, thus leading to improved security and less risk. Hot wallets are more likely to be used for daily transactions, and cold wallets for more long-term holdings.
- Hardware wallets
Hardware wallets are hardware devices that individually handle public addresses and keys. It looks like a USB with an OLED screen and side buttons. It is a battery-less device and can be connected to a PC and accessed by native desktop apps. They are more secure than hot wallets and user-friendlier than paper wallets but less than web and desktop wallets. The most popular hardware wallets are Ledger Nano S and Trezor.
- Other Wallets
You can also choose Mobile Wallets such as Coinomi and Mycelium, Desktop Wallets such as Exodus, Bitcoin Core, Electrum, or Web Wallets which can be non-hosted wallets such as MyEtherWallet or MetaMask or hosted wallets Binance, Coinbase, and others.
Keep Track on Crypto-Related News
Once you have finalized a crypto exchange platform and a perfect crypto wallet, all you need to do is keep track of crypto-related news before making any investments. To study the asset, one of the best tools for this research is Coinmarketcap. It is a price-tracking website for crypto assets where you can find information on every coin, such as capitalization, supply, trade volume, and other valuable insights.
Hope this article has helped you in providing a complete understanding of how to start trading cryptocurrencies. If you want to gain a deeper insight into cryptocurrency trading and investing strategies, you can check out the best cryptocurrency certification courses offered by Blockchain Council and become a Certified Cryptocurrency Trader.