Starting a crypto trading journey is not as easy as it sounds. It involves a myriad of complexities and requires knowledge, well-defined strategies, the ability to mitigate risks, and more. In this article, we’ll break down four tips that, if you follow them, will help you get started with crypto trading.
1) Select a Reputable Cryptocurrency Exchange
The first step is to use a reputable cryptocurrency exchange, which will help you avoid costly mistakes while trading. Regulated by the government officials, cryptocurrency exchanges offer the highest level of protection for your digital currencies.
Before you make a choice, you must get the latest crypto market news and trends as well as exchanges. On the market, the four most prominent and best-serving exchanges are as follows:
- Coinbase,
- Gemini,
- eToro, and
- Kraken.
That’s why it’s vital to investigate them in detail and select the one that best meets your trading needs and goals, whatever they may be.
Determine what trading volume is, how to maintain a record over the last 5-10 years, and how to store and protect your digital assets within the platform. Having the right cryptocurrency exchange will keep you on the right track throughout your trading journey.
2) Set Up an Account and Complete the Verification Process
The next move you should make is to set up an account to execute trades from. To get into the crypto trading landscape, you must undergo the verification process that requires;
- your social security number (for US citizens),
- an email address, and
- additional personal information.
When provided, you’ll see that your assets are linked to you when you invest in cryptocurrencies. This will reduce the prospects of fraud and scams.
3) Deposit Fiat Currency into Your Crypto Exchange Account
It’s now time to deposit some fiat currency from your bank into your cryptocurrency exchange platform account. Let’s first understand what a fiat currency is. It’s a currency that’s issued by the government and not backed by any other asset class, such as gold or silver.
Once you have this money, you will feel more empowered to purchase the first cryptocurrency on the exchange platform.
4) Purchase, Sell, and Swap Cryptocurrencies
It’s advisable to choose a cryptocurrency coin that you want to invest in. In most cases, the ticker symbol is attached to the coins. So, be mindful and research the names of the coins and their ticker symbols. Doing so will help you avoid confusion.
For instance, Bitcoin is represented by the ticker symbol “BTC,” while Ethereum is represented by the ticker symbol “ETH.” You enter the quantity of that cryptocurrency you wish to purchase. The price of a single token can range from just a few cents to several thousand dollars, depending on the cryptocurrency.
As a novice, if you initiate with a fraction of a larger coin, this will ease your way in. When selling a coin, consider selecting the coin from your crypto exchange wallet and specifying the amount type to sell.
You can trade this sum for a corresponding amount of a different cryptocurrency or convert it back to fiat currency. Numerous traders frequently buy and sell coins as prices fluctuate, which is effective.
5) Keep Tabs On Your Account and Trade History
To identify trends and patterns, keep tabs on your cryptocurrency values, as the market cycles through phases:
- accumulation,
- markup,
- distribution, and
- decline.
Over time, you’ll learn strategies that suit your trading style, aiding in decisions on when to buy, sell, or withdraw funds to secure gains or mitigate losses.
When you’re ready to exchange cryptocurrency for fiat money, use the transfer and withdraw options on your exchange platform to move funds to your bank account or another wallet.
