10 Tips To Help You Start Trading Crypto and Make Money

Image Source: FreeImages

‍

With the crazy bull market and bear market of the past year, many people have discovered cryptocurrencies and become obsessed with trading them. There are now more than 2000 different coins that you can trade. If you’ve recently discovered your passion for crypto or if you’ve been thinking about dipping your toes into the crypto waters, now is a great time to get started. Whether you prefer to trade in small high-risk trades or large low-risk trades, there are several strategies that can help you grow your portfolio. However, before you dive headfirst into this volatile world of cryptocurrencies, it is important that you first understand what trading crypto is and what the risks are associated with it. Trading digital currencies like Bitcoin, Ethereum, Ripple and others are not for everyone. You should have an idea of these things before proceeding further:

What is Crypto Trading?

Trading is simply the process of buying and selling assets. In crypto trading, you are buying and selling different cryptocurrencies. You can buy crypto assets with fiat currencies or other cryptocurrencies. This means that you can trade almost every asset in existence using crypto assets as a medium of exchange. If you can’t find an asset you’re interested in trading, it is likely that someone has created a token that represents that asset. There are two main types of crypto trading – spot trading and margin trading. When you spot trade, you are buying and selling an asset at the current market price. When you margin trade, you are borrowing money to increase the number of assets you can purchase. Margin trading is riskier because you are putting more of your capital at risk.

Understanding the risks of crypto trading

Before you even get started trading, you need to fully understand the risks involved in this highly volatile and unpredictable market. Trading cryptocurrencies is incredibly risky. There is no guarantee that you will be profitable or even break even. You could lose all of your money. If you are someone who is comfortable with taking high risks for the possibility of high rewards, then crypto trading might be right for you. If you are someone who prefers a low-risk approach to invest, then crypto trading might not be right for you. In addition to the normal risks of trading, there are some unique risks specific to crypto trading that you should be aware of. – Volatility – The crypto market is incredibly volatile. It is normal to see swings of 10% or more in a single day. There have been several occasions where the entire cryptocurrency market has lost or gained 20% or 30% in a single day. – Lack of regulation – Although regulations are slowly starting to take effect, the crypto market is still largely unregulated. This means there is no one to protect you if you are scammed or if you lose your money in a bad investment. Make sure you are doing your due diligence and investing in coins that have a strong team and solid fundamentals. – Hackability – Unfortunately, the crypto market is known for being hackable. This can occur when people gain unauthorized access to your digital wallets and steal your coins. There have also been instances of exchanges getting hacked, which has led to millions of dollars worth of coins being stolen. – No track record – Since the crypto market is still relatively new, there has not been enough time to determine which coins will be successful and which ones will fail. This means that the track record of cryptocurrencies is pretty much 0%. This means that you have no idea if the coin you are investing in will ever recover or if it will ever reach a price that is above your buy-in price.

The platform for crypto trading

There are several different cryptocurrency exchanges that you can use to trade crypto. The platform that is best for you will depend on your trading strategies and the amount of money you plan to invest. The following are some of the most popular cryptocurrency exchanges and the associated trading pairs that are available: – Coinbase – This is a beginner-friendly platform designed for those who only plan to trade small amounts. It supports three different currencies: Bitcoin, Ethereum, and Litecoin. Coinbase is best for those who plan to use their coins as a means of payment instead of investing in them for profit. – Binance – This is a user-friendly platform that has been gaining a lot of popularity. It supports more than 100 different cryptocurrencies and has a very low trading fee. If you plan to trade small and large amounts and are looking for a wide variety of coins to choose from, this is a great option. – Kraken – This is a great option for those who prefer to use their coins for investment rather than a payment. It supports 18 different cryptocurrencies and has a decent trading fee. – KuCoin – This is another user-friendly platform that has a wide variety of coins for you to choose from. It also has very low trading fees. If you want to trade on a platform that is similar to Binance but with a wider selection of coins and without the need to use your crypto as payment, this is a great option. – Poloniex – This is a great exchange for those who want to trade large amounts of cryptocurrencies. It supports 17 different coins and has a decent trading fee.

Strategies for profitable crypto trading

There are many different trading strategies that you can use to try to make money with crypto trading. The following are some strategies that have worked well for many crypto traders. – Diversify your portfolio – This is a strategy that applies to all types of trading. It is important that you diversify your portfolio. You don’t want to put all of your money into one single coin. This is because you don’t want to put all of your eggs in one basket. What happens if that coin never reaches the price you bought it at? You lose all of your money. If you diversify your portfolio, even if one coin doesn’t work out, there is a good chance that another coin in your portfolio will recover. – Only invest what you can afford to lose – This rule applies to all types of trading. You never know how an investment will work out. Even if you think you have a 99% chance of making money, there is always a chance that you will lose everything. This is especially true in the crypto market, where prices can change significantly in a single day. Don’t invest more than you can afford to lose. It is better to miss out on an opportunity than to risk everything and lose everything. – Buy low and sell high – This is another strategy that applies to all types of trading. If you buy when the market is low and sell when the market is high, you will make a profit. You need to be patient, though. You cannot predict exactly when the market will go up or down. All you can do is buy low and sell high as often as you can.

Wrapping up

If you’re excited about crypto trading, now is a great time to get started. The market is more volatile than ever and there are a lot of opportunities for people who are willing to take a risk. However, before you dive headfirst into this volatile world of cryptocurrencies, it is important that you first understand what trading crypto is and what the risks are associated with it. There are many different strategies that you can use to try to make money with crypto trading. However, before you dive headfirst into this volatile world of cryptocurrencies, it is important that you first understand what trading crypto is and what the risks are associated with it.