You must have considered cryptocurrency as the reigning gem of the day, with over $2 trillion in global funds invested in it, by deciding to trade this niche for a variety of reasons, including the uptrends of favorable news circulating the crypto space, in terms of adoption and large profits. Below are some useful tidbits to help you get your bearings before diving headfirst into the realm of candlesticks and patterns when you purchase your first cryptocurrency.
BUYING CRYPTOCURRENCY
There are over 400 cryptocurrencies to select from in the cryptocurrency market, including Bitcoin, Ethereum, Dogecoin, Cardano, XRP, Litecoin, and many others. In the crypto space, buying in bits of high-cost tokens like Bitcoin, Ethereum, etc, is conceivable on the cryptocurrency exchanges and brokerages instead of the thousand dollars’ worth. Crypto calculators for cryptocurrencies, such as the Ethereum calculator, are increasingly being used by first-time crypto enthusiasts and traders to check up-to-the-minute fiat to crypto and crypto to crypto rates, as well as compare the exchange rates of several cryptocurrencies, including ETH, XRP, ADA, and BTC to EUR and USD.
WHAT TO KNOW BEFORE YOU BUY
Here are some of the tips to guide your thoughts and help you have a safe landing on the crypto space while buying cryptocurrencies to invest in or trade:
1. Invest only what you can afford to lose
One of the golden laws of the crypto sector is to invest only what you can afford to lose. The crypto market is volatile, and while it might generate large profits, it can also go the other way, as there is now no visible restriction on price swings. Bitcoin, the most prominent cryptocurrency, has had ups and downs in terms of price swings, resulting in losses for many wallets, particularly in futures trading, which can also be seen in altcoins. Nothing is certain except the volatility, so don’t bet the farm, or your life savings, on any coin.
2. Avoid the FOMO (Fear of Missing Out)
The FOMO that comes with seeing certain token trains up with fantastic percentages as they head to the moon is similar to the first. FOMO can be beneficial if you’re lucky, or it can be terrible if you’re not, but it’s usually the latter because it’s a reaction to something that should have been researched. In this competitive market of earnings, staying rational to the core with your analytic and research tools is critical to avoid losses.
3. Maintain a comprehensive and well-researched approach
Many projects may not perform as expected, therefore check the project’s validity and potential before investing in its utility tokens. Many initiatives have attracted large sums of money, yet at the end of the day, liquidity has been depleted. It’s safer and more profitable to do needful research to have a safe and smooth journey in the crypto space.
4. Include analytic sense
Build your trading spree with research papers or books on trading analysis before joining the crusade. This is a tangible way to trading success, whether as a spot trader or futures trader.
CHOOSING A CRYPTOCURRENCY EXCHANGE
The cryptocurrency market is comparable to a traditional market in which vendors exist to serve buyers, with a few twists using one of the major cryptocurrency exchanges. A cryptocurrency exchange is a company that specializes in buying, selling, and trading digital currencies. There are over 300 cryptocurrency exchanges to select from, each of which is ranked by famous crypto websites like Coinmarketcap based on factors such as security, trading expertise, trading volume, transaction costs, and mode of purchase. Coinbase, Binance, and Probit are some of the most well-known cryptocurrency exchanges. To choose the fitting amidst the excess and to save costs, you might aim to learn enough to utilize the standards of such a trading platform before you make your first crypto purchase or not long after. As there are different terms and conditions attached to different exchanges.
CHOOSING A CRYPTO WALLET
When you purchase cryptocurrency, it is usually stored in a crypto wallet linked to the exchange. With the recent history of crypto exchange breaches, many crypto traders and fans have made it a habit to transfer their coins to safer wallets for security reasons. The main tunneller in picking crypto wallets has been the reason for security and protection of crypto assets, which includes:
1. Hot Wallets
These are online crypto wallets that run on internet-connected devices, including tablets, PCs, and phones. Hot wallets are easy to use and frequently available yet they are online wallets which makes them vulnerable to attacks.
2. Cold Wallets
Because cold crypto wallets are not linked to the internet, they are the safest way to store cryptocurrency. Good examples of cold wallets are hardware like USB devices, Electrum, Paper Bitcoin wallets, etc.
Protecting the keys or devices from damage, whether in a hot or cold wallet, is critical. Nor your keys, not your coins, remember.
Also Read: How to Be Successful in Crypto Trading
