Beginners Guide To Cryptocurrency
The Absolute Beginner’s Guide to Cryptocurrency Investing. When you get acquainted with buying crypto and start to itch for some crypto trading (e.g. BTC/ETH), simply perform an instant transfer from Coinbase to GDAX free of charge and start trading. Think of Coinbase as the place to conveniently buy and store your crypto and GDAX as your. The Simplest Way I can Describe Everything You Need to Know About Cryptocurrency. Here is a guide to cryptocurrency for beginners. We offer simple answers to questions like what is cryptocurrency, how does it work, what is Bitcoin, what is blockchain, how do I buy cryptocurrency, etc. Metaphor: Cryptocurrency is a bit like online banking without a central bank. A Complete Guide to Cryptocurrency for Beginners. If you’ve ended up on this page, then there’s a chance that you’ve caught wind of the massive cryptocurrency buzz sweeping the world. Over the last year, cryptocurrencies like Bitcoin and Ethereum have gone from being relatively unknown to.
Have you been curious about cryptocurrency? Maybe you’ve been a little nervous or intimidated about getting set up? Well, worry no more, this article is here to help. I had personally wanted to get into crypto for years, but felt that it was a little overwhelming and confusing, so I put it off. Unfortunately, this cost me years of experience, and likely quite a bit of potential monetary gains. As of writing this, I have been a proud owner of cryptocurrency for about three months. With the potential struggles and questions of a new crypto user fresh in my mind, we thought that a handy guide for crypto newcomers would be helpful. I am going to try and keep this simple, and not super technical, mainly just a guide to help you get started.
Before we get into this, I need to say that I am not giving financial advice. I am in no way, shape, or form professionally qualified to tell you what you should do with your money. Those are decisions that we all have to make for ourselves. Throughout this article, I will reference or use particular crypto currencies, wallets, services, etc. This is not necessarily an endorsement of those products and services. I picked them mostly for ease of use and to keep things simple for the explanation purposes of this article. To my knowledge, the products I have referenced should be just fine, but they are by no means an all-inclusive list; feel free to explore other services, you may find ones you like better.
What is cryptocurrency? I know I said nothing too technical, so I promise this explanation will be brief. According to Coin Market Cap, there are over 6000 crypto currencies, and they may work in different ways. Cryptocurrencies are basically digital currency. They are secured by cryptography (hence, the “crypto” in cryptocurrency) which makes them near impossible to counterfeit, or to double spend. They are generally decentralized networks based on blockchain technology. Because they are decentralized, they are outside of the control of government and banks. Bitcoin was the first and most famous cryptocurrency, and the first digital currency based on blockchain technology. Blockchain is basically a term describing a public ledger that is timestamped and unchangeable. Here is a link to an article by Sal Mayweather if you would like to learn more about the technicals of blockchain technology and cryptocurrency.
The first step on your crypto journey will be to download a wallet. A wallet is a program on your computer or phone that allows you to store, send, and receive cryptocurrencies. There are many of them out there; they are free and you can have more than one, so don’t worry, you aren’t committed to anything. Just make sure that you get a wallet that is compatible with the particular cryptocurrency you wish to obtain (perhaps the first step should be to determine what crypto you want, but we’ll get to that later). Let’s keep it simple and assume that you are going to be purchasing some bitcoin cash (BCH).
(Note: I am not advocating for any particular coin, however due to a few factors, including transaction fees, we will be working with BCH.)
Try downloading the Jaxx Liberty wallet onto your phone and/or desktop. I like this wallet; it’s super easy to use, handles dozens of different cryptocurrencies, allows you to purchase crypto right from the app, and they are responsive if you should have any issues. I also really like the bitcoin.com wallet, it is easy to use as well. Note: When purchasing crypto through Jaxx, and the Bitcoin.com wallet, they will require you to submit personal info for tax purposes. Once you have provided them with your I.D., those wallet addresses will be forever tied to the identity provided, and you will not be able to remain anonymous.
When you first open your wallet, you will want to click on “create new wallet”. You will be prompted to back up your wallet; you want to do this, it is very important. Backing up your wallet allows you to recover it at any time, from anywhere. By using your 12 word “seed phrase,” you (or anyone who has the phrase) can recover and access the wallet in the event you lose or break your device. It is very important to write down your phrase and keep it in a safe and secure location. If you lose it, you lose access to your wallet, and you will have no way of recovering your crypto; it is your responsibility. Also keep in mind that if anybody else obtains your phrase, they can use and transfer funds from your wallet.
Once you begin to backup your wallet, you will be given 12 words. Write them down, in order. You will then be asked to confirm your phrase by putting the words in order. It’s simpler than it sounds, they just want to make sure you have followed instructions and backed up your wallet. After you have confirmed your seed phrase, you are all set! It should take you to your holdings page, where it shows what cryptos you have, and how much they are worth in dollars. As of now, this should say zero. By clicking on the wallets tab on the bottom of the screen, it will take you to your different wallets. Here, you have the ability to turn the visibility of wallets for different coins on or off. This allows you to hide the clutter of wallets you don’t use, which you can edit by clicking the edit icon in the top right corner. Congrats! You’re now ready to accept crypto!
So, now that we have our wallet set up we can do a couple of things: we can’t spend any BCH yet, since we don’t have any. We do have the ability to receive though, so let’s go ahead and talk about that. Let’s say you’re having a yard sale, and you’re selling your old bike for 20$. The purchaser asks to pay with Bitcoin cash! Grab your phone and open your Jaxx wallet, select your BCH wallet in the wallet tab, then select the receive button. The app will display a QR code and an address consisting of a long string of characters. The purchaser will open their app, enter the amount (20$), and then scan your QR code…and you’re all set! Your BCH should show up in your wallet within a few minutes. If you were doing a sale where the purchaser isn’t present, you can copy and paste that long string of characters into an email or text, and send that to the buyer. They will be able to insert that address into their wallet and send funds that way as well. We will discuss purchasing crypto a little later, but let’s go ahead and talk about sending crypto with your wallet.
Ok, so the following week your neighbor is having a yard sale and you want to buy a fishing pole from her for ten dollars. Since you are lucky enough to live in a neighborhood with so many other agorists, she is happy to accept BCH! Take out your phone, open your Jaxx wallet, and select your BCH wallet from the wallet tab. Press the send button to open your send menu. First, enter the amount you want to send at the bottom of the screen. You can enter the amount in USD or in BCH. Go ahead and enter $10.00 in the USD field; the app will show you the equivalent amount of BCH in the BCH field. Note that below these fields, it will show your total amount of BCH available, as well as the transaction fee that will be taken out of this purchase.
Next, you will need to tell the wallet where to send the crypto. At the top of your screen, you will see an address field. You can copy and paste an address here, you can select an icon to scan a QR code, or select an address from your contacts. Because this is an in person transaction, we will select the QR code option. Your neighbor will open her wallet and select receive; this will generate the QR code for you to scan with your phone. Scan it, and that’s it! Your crypto should arrive in her wallet within a few minutes. Alternatively, if you are making a transaction and the receiver isn’t present, you can copy and paste the address sent to you in the address line instead. It is also worth noting that the desktop version of Jaxx does not have the scan QR code option, as it isn’t really necessary.
How to purchase cryptocurrency
Now that we have learned the basics of how to use your wallet, let’s figure out how to put something into it in the first place. If you’re lucky enough to have people lined up at your door to pay you for goods and services in crypto, this may not be important. For the rest of us, however, there are a few ways to go about this. Let’s explore some options.
First, what are crypto exchanges, and how do I choose one? We will keep this section as basic as possible, but there are some differences between exchanges that we have to cover. First, what are the different types of exchanges? (Note: this isn’t an all-inclusive list!)
-Centralized exchange: A centralized exchange is a crypto exchange run by a centralized company. Since they are regulated by the government, you are required to give up personally identifiable information (i.e. name, address, social(ist) (in)security card, etc.) before making purchases or exchanges. It may not be a big deal for some; however if you are looking for privacy, it is certainly worth noting. Also be aware that you are legally required to pay taxes on gains from crypto (that is, gains that the government is aware of). They tend to be easier to use, and you can purchase crypto with fiat currency. Please remember to look at and compare fees and such before making purchases.
Pros include:
-Typically easy to use
-You can purchase crypto with fiat currency, via credit card or bank account
Cons include:
-Funds are controlled by the exchange
-More vulnerable to hacks or malfeasance
-Government regulated
-Not anonymous (require Know Your Customer (KYC) personal info)
-Centrally governed
-Decentralized exchange: A decentralized exchange (DEX) is a totally open source marketplace for cryptocurrencies. Instead of dealing with a centralized company, buyers and sellers deal more directly with each other for their transactions. These tend to be much more private and in some ways much more secure. They can be a bit more complex, and usually require that you trade crypto for crypto, as opposed to being able to purchase with a debit card.
-Pros include:
-Users control the funds, meaning you don’t have to entrust them to a third party
-Not subject to hacks like a centralized exchange
-No KYC so you can remain anonymous
-Less subject to government control
-Cons include:
-Are more complicated to use
-Do not take credit/debit cards
-Must trade crypto for crypto, therefore you must already be holding cryptocurrency
-Fees may be higher, therefore it may be good to use a DEX for larger trades
-Peer to peer exchange: A peer to peer exchange is a type of decentralized exchange where you will actually interact with the person you are trading with. These exchanges can allow you to have more control over your trade and allow for anonymity as well. When the two parties work out the arrangement, the funds and crypto are held in escrow and then released once the conditions are met. This way, you don’t have to blindly trust the person you are trading with. Also, there are rating systems and such so you can have an idea of the person’s reputation before commencing the trade.
-Pros include:
-More control over your trades, such as who you will deal with, prices, and method of payment.
-Usually has low transaction fees.
-Doesn’t require KYC documentation, allowing for a degree of privacy (although it’s not required to use the exchange, some sellers will want you to verify your identity)
-Generally easier to use than a DEX
-Cons include:
-Some sellers will only accept certain forms of payment, so you may be limited based on how you are willing to pay.
-Although reviews and rating systems provide a good degree of confidence, there is always a counterparty risk.
So which type of exchange should you use? Decentralized exchanges have a degree of difficulty, so they may not be the best place to start. You would also need to have crypto to trade with. Centralized exchanges, or just purchasing crypto through your wallet is surely the easiest. You can simply sign up and pay with a credit card, and they are usually pretty secure. You will have to give up a bit of personal info, so if privacy is what you’re looking for, it may not be ideal. Also keep in mind that centralized exchanges have to report to the IRS, so if you are buying large quantities, bear that in mind. Centralized exchanges may be a good place to start; you can easily get some crypto to play with, make a few purchases till you’re comfortable, then explore other options. I personally like the peer to peer exchanges. In my experience, they have been easy to use and the privacy factor is a big plus as well. Up next, we will go a little more in depth into the peer to peer exchanges, and how to use them.
Peer to peer exchanges, or sometimes called “local” exchanges, exist for most popular cryptocurrencies. Sticking with BTC for this, let’s check out Local.bitcoin.com. The first thing you will want to do is create an account. Once you do this, an associated wallet will be created. Coins you purchase will go here; and from this point, you can transfer them to another wallet, let’s say your Jaxx Liberty wallet we set up earlier. Also, don’t forget to keep your user name and password in a safe place! You should also back up your wallet, especially if you plan on holding funds there. Note: the backup for this wallet is not a seed phrase, rather a file that you download.
So, you have your account all set up; on the home page, click the “browse listings” button, and it will bring up all of the available listings. There are some drop down menus at the top to help you narrow your search. In the first one, select that you want to buy BCH, if you have a specific payment method, you can select it from the second drop down menu. I have a few ways that I am willing to pay, and the drop down is not an all-inclusive list, so I usually just leave that one alone.
Next, you have the location drop down, in case you want to specify a country. I usually select “USA” because it’s more likely I will find people who want to trade in dollars (under advanced search options there is a drop down for currency specifically). Now that we have it narrowed down a bit, you will see the available listings populate. Each listing will have the name of the seller, the payment methods they accept, their location, volume they are willing to trade, and finally a button with the price. When you see a listing that tickles your fancy, click on that button to get more details. Some things to look for: what payment methods they take, if they require KYC info, their feedback ratings, price etc. Once you make sure that you agree with the price and the terms, you can initiate the trade. Simply enter the amount you want to purchase, send them a quick message, and the click open trade and follow the instructions given. The sellers coins will be held in escrow until your payment clears, then the coins will be released to you! You can find them in your wallet, however they may take a few minutes to show up; but once they do, you can transfer them out to your preferred wallet. I have found that you may pay a little more for the coins using a site like this compared to some centralized exchanges, but the private nature of the trade is a definite plus.
If you have made it this far with me, you are well on your way to being a crypto master! Before we wrap up, there are just a couple more things I would like to go over.
-Privacy coins and considerations: Oftentimes, people are under the assumption that Bitcoin and other cryptocurrencies are totally anonymous, and that isn’t necessarily true. Although you don’t need any personal info to open and use a wallet, remember that the blockchain is a public ledger. Even though your name may not be attached to your wallet, your wallet still has an identification itself. Over enough time, with enough transactions, it is possible for some software to pick up patterns and trace a coin’s journey from wallet to wallet. For this reason you should not just assume that all of your crypto transactions are totally private.
Why would someone who isn’t doing anything nefarious care about being anonymous? If you aren’t doing anything wrong, you don’t have anything to hide right? (Of course, that last line should be read in a sarcastic tone.) While there are many answers to this question, my first is always, “Why the heck not?!” Why would you want a government or any other entity tracking where and how you spend your money? What good could come of that? Also, what a government deems as immoral or against the law may not actually be a crime in the sense that there is no victim. So, who cares if they don’t approve? This is a great place to point out that all sorts of illegal activity and substances are paid for mostly in Federal Reserve Notes (cash), so the idea that crypto is mainly a vessel for criminal activity is absurd; they (“criminals”) privately transact in cash every day, and in far higher amounts.
Finally, it is apparent that governments want to control everything they possibly can, especially money. Therefore, having a private currency that they cannot control is key to breaking the chains of government oppression and that pesky inflation tax. In Wendy McElroy’s fantastic (free) book, “The Satoshi Revolution”, she does a fantastic job making the case for crypto and why it is an important tool in our fight for freedom, I cannot recommend it enough.
“Ok, we get it, privacy is important, how do we make it happen?” We have a few options here for what we can do. First, there are services called “coin mixers”. These applications take coins from several different users, mix them together, then re-distribute. By doing this you are getting different coins than you put in. This makes it much less likely, or even impossible, for coins to be traced once mixed. Check out the Electron Cash wallet, if you like, it has shuffle technology built in. Check out thisarticle by Brandon Aragon for more info on this topic.
Another useful crypto tool are coin swap apps (I like Simple Swap, but there are many out there, and you may need to explore a few if you are looking for a specific coin). A coin swap allows you to very simply, and usually inexpensively, swap one crypto for another. I have found these apps handy when a vendor only accepts a crypto that I don’t currently hold. Also when I want a particular coin that is difficult to find on exchanges, or on exchanges that I find difficult to use, I can often find them available at a coin swap service. I’m putting this in the privacy section because of one other feature.
When you do a coin swap, the coins you receive are (usually) “airdropped” to your wallet. If you open a brand new wallet to have your coins deposited into, it is much more difficult to trace the connection between the input, and output of the swap. Let’s say you have your primary wallet that you use to store most of your crypto, and you send some to someone else, or another wallet; there is a record of that currency moving from one wallet to another. When it is instead sent to a swap app (unless you have your exchanged coins deposited in the same wallet), that will be where the trail ends. If you have your exchanged coins deposited in a new wallet, you can then spend that crypto without it being connected back to your primary wallet, therefore giving you some privacy with those transactions. Note: In respect to privacy, this method is similar to a coin mixer, but it is a different way of going about it.
Finally, let’s talk about privacy coins. Some coins are actually designed with privacy in mind. These are usually not found on the larger, centralized, and government controlled exchanges, as they are frowned upon by governments (I wonder why?). These coins are designed in a way that obfuscate some of the transaction data in the blockchain. They may do things such as create one time wallet addresses for each transaction so that your private wallet addresses aren’t visible on the blockchain. Some will simply only post updated ledger balances without actually tracing the path of each individual coin. Utilizing ring signatures is another popular method of obtaining privacy, or at least providing reasonable doubt. The most notable/popular privacy coin is probably Monero (XMR), but some others that are worth checking out are Epic cash (EPIC) and Devault (DVT). Please make sure to do your research about whatever coin you plan on using to make sure it is suitable for your needs.
Before we wrap up this article, we should talk about where/how to spend your crypto. While crypto is great for small personal transactions between two people, many businesses are also getting on board and accepting cryptocurrencies as well. There are many directories online to find retailers that accept crypto; here is an interactive map showing places all over the world that accept BCH. Dash (DASH) is a popular coin for retailers; here is a directory for businesses that accept it. You can search for a directory for whatever coin you want to spend and see what comes up! Another option is buying gift cards with crypto, which you can then use at stores that don’t accept crypto. Check that out, plus the option for a crypto debit card from BitPay.
One of the best things you can do to personally help promote crypto usage at large is talk to your local businesses that you visit. Try asking if you can pay with crypto at your local restaurant, Hair Cuttery, or farmers’ market. You never know, they might say yes, or at the least it may make them start to consider it. It also gives you a great way to start a conversation with someone about the benefits of using and accepting crypto. If you are a vendor or internet retailer, there are many programs out there that can facilitate those transactions. I use AnyPay for my personal business.
There you have it folks! This should be a good base to get started from on your journey into cryptocurrency. Try purchasing a small amount of BCH (maybe 50 or 100 dollars worth) and do some small trades with it. Try sending a dollar or two between two wallets, or between you and a friend. This practice will make you confident in larger transactions, and if you mess up, it’s just a buck! I will include some links below to some valuable reading that will help you become even more knowledgeable! Please don’t forget to check back with Agorist Nexus frequently for more content on crypto currency. Remember, when using non central bank controlled currencies, you are cutting the banks out of the picture, and showing them that they are not needed. Together we can make them obsolete.
-Dagorist
• Agorism And Breaking The Chains Of The State By Brandon Aragon
• How I Became My Own Bank & How You Can Too By Sal Mayweather
•On The State of P2P Cash By Sal Mayweather
• The Properties of Money and Cryptocurrency By Brandon Aragon
As part of our crypto trading education center, we’ve set up resources to help you learn the basics and get you on your way to successfully trading crypto and other digital assets. This Cryptocurrency Trading for Beginners Guide starts with understanding the basic terminology and ends with the essential tools and mindset need for crypto trading.
***This is not financial advice. Always do your own research and understand the risks. These resources are for educational purposes only.***
Basic Terminology for Trading Cryptocurrencies
Cryptocurrency trading for beginners starts with understanding the language of crypto trading, we’ve curated a list of the top terms with a definition, as well as a link to further reading on the term in question. At the end, we’ve linked the HedgeTrade Encyclopedia to give a more expansive crypto language immersion in addition to some of the slang used by crypto market participants. This is not alphabetical; instead we tried to introduce the most basic terms first and build up to the more complex crypto trading terminology.
Cryptocurrency
A cryptocurrency is a digital currency that operates on a blockchain, where all of its transactions are immutably stored. Cryptocurrencies all utilize encryption technologies to regulate how many units of currency will be minted and how transactions are carried out. Additionally, crypto enables secure, peer-to-peer payments and other economic opportunities that rest outside of 3rd party financial institutions and central banks. Read more: How Do Cryptocurrencies Work?
Blockchain
A blockchain is an online database of transactions that lives in real time on a cryptographically secure distributed network of many computers. Anyone can access the transactional information on any public blockchain (such as Bitcoin and Ethereum). Transactions are stored in blocks of data that are all connected in a chain leading back to the original “genesis” transaction. This is accomplished through a system of hashing algorithms, making it particularly difficult to alter and manipulate the blockchain’s data. Cryptocurrencies are issued on blockchains and their movements are found on each blockchain’s Explorer. Read more: What is Blockchain Technology?
Centralized Exchange (CEX)
A Centralized Exchange (CEX) refers to an online platform for buying, selling and trading cryptocurrencies that has a central governing authority such as a CEO or Founders. A CEX normally has strict KYC and AML policies in place. Crypto private keys of CEX users are held by the company behind it or a 3rd party. Examples of popular centralized cryptocurrency exchanges include Binance, CoinBase and Gemini. Read more: CEX vs. DEX Which is Best?
Decentralized Exchange (DEX)
A decentralized exchange (DEX) is a cryptocurrency trading market that has no central authority and allows for peer to peer crypto trading. A DEX is trustless in nature, meaning you don’t have to trust a third party to make financial transactions. Everything runs according to the algorithmic, automated protocol. Additionally, DEX’s do not require investors to give any personal details about their identity to transact in crypto trading on the exchange. DEXs also enable traders to engage in token swaps and defi farming activities. Examples of decentralized exchanges include Uniswap, Idex, and Bancor. Read more: Understanding Decentralized Exchanges
Wallet
A crypto wallet stores the public and private keys that enable you to access your digital assets. Wallets come in different forms, each with their benefits and drawbacks. An online (‘hot’) wallet stores the keys in an online location. A hard wallet stores them on a piece of hardware, similar to a flash drive. Paper wallets mean you have simply written down your keys and stored them physically someplace safe. Hard wallets and paper wallets are known as ‘cold storage’, meaning they are safely kept offline. Hot wallets are not considered as safe but they do offer more convenience. Read more: What is a Hard Wallet?
Self Custody
Self custody of crypto assets means that you and you alone possess the private keys that allow you access to your cryptocurrency and digital assets. Private keys generally consist of a long string of random words that you can put into cold storage, such as using a paper wallet (printing out the words and storing safely) or storing in a hardware wallet (similar to a flash drive). You utilize the private keys when you want to move your crypto assets.
With self custody, you are also in charge of securing the private keys. If they are lost, there is no one to turn to to retrieve the lost keys. DEXs now offer many different types of activities for trader, such as yield farming and staking, all while their assets are in self custody. Centralized exchanges store each user’s private keys, which sometimes creates an attractive ‘honeypot’ for hackers. Read more: What is a Private Key?
Order book
An order book in crypto trading is a visual and in-real-time list of outstanding buy and sell orders on all the crypto assets listed on a particular exchange. When a trader logs into a crypto exchange, they use the exchanges order book to place their buy and sell orders.
Short/Shorting vs. Long/Long Position
Shorting a digital asset or taking a short position means that you’re betting that the price of an asset will fall. Going long or taking a long position means you are betting that an asset will rise in value. Ways that traders can short or long cryptocurrencies include futures, options, margin trading and prediction markets.
ROI
A return on investment (ROI) signifies what a trader receives in gains (or losses) from the time they buy a digital asset until they exit the trade. It can also refer to a cryptocurrency, where the ROI signifies the return on investment from the digital asset’s first price until the current day.
Once you have these essential terms nailed down, feel free to delve deeper into crypto trading terminology by visiting the HedgeTrade Encyclopedia
Now that you’re familiarizing yourself with the basic terminology of crypto trading, the next stop in our Cryptocurrency for Beginners Guide is learning how to buy and sell cryptocurrency so you can get started. This section will provide the top resources for walking you through the process of buying and selling crypto so you have the knowledge needed in becoming a crypto trader.
The Novice Trader’s Toolkit
This list will include the essential tools and things you need to begin your crypto trading adventure.
- Cryptocurrency! – Starting out with some of the major coins that have proven themselves over time, including bitcoin (BTC), Ethereum (ETH), and Litecoin (LTC), can help get the ball rolling. These coins have strong liquidity in hundreds of markets. There’s also an incredible amount of content around these cryptos for people to study. To buy crypto, you’ll need a fiat onramp such as a centralized exchange. Alternatively, maybe you know a friend who is willing to send you a little ETH or BTC to get you started.
- A Wallet – Once you have bought your crypto, you may want to keep in a cold wallet, such as a Trezor hardware wallet or a paper wallet. If you decide to trade on a centralized exchange, they will custody your crypto (and private keys). Decentralized exchanges (and a few CEXs) allow traders to self custody their own assets in a Web3 wallet such as MetaMask while engaging in crypto trading activities.
- An Exchange Account – Choose the exchange you will use for trading and set up your account. Some trading desks such as Quadency and TradingView enable you to set up multiple exchanges in one trading platform. But newcomers can start out with one and expand as they improve their skills. Familiarize yourself with whichever trading venue you decide on. Be sure to watch any video tutorials on how to use the exchange in question.
Evaluate your risks
Create a personalized risk assessment by determining the following factors by yourself or with an investment advisor):
- Factor 1: Your Time-Frame – What is your age and how long do you have to use your determined amount of money for investing?
- Factor 2: The Size of Your Risk Capital – Meaning what can you afford to lose? Cryptocurrencies are highly speculative and risky investments. Generally, the more capital you have to invest, the higher the tolerance for risk.
- Factor 3: Your Experience – Risk taking often increases as traders become more confident with successful trades under their belts. Copy trading and social trading platforms are great for easing in new traders. They allow novices to study and copy the trades of professionals.
- Factor 5: Your Goals – What are your long term and short term goals for the investment amount you have allocated? Are you investing for retirement or looking for passive income?
- Factor 6: Your Psychological Profile – High stress and high anxiety individuals may not enjoy the volatile crypto markets. This in turn may make it difficult for them to stick to their trading plan. If you are the type of person who gets upset when things go wrong, crypto trading may not be for you. On the other hand, if you have a sense of adventure, are willing to take risks and face consequences of those risks, then trading may not seem so stressful.
Cryptocurrency trading for beginners – 5 helpful hints for getting started
- The level of profit you are hoping for is directly related to the level of risk you are taking.
- The greater your expectations are about profit, the more likely it is that you may lose part or all of your investment over the short term.
- Your goals and investment time frame may increase or reduce your risk tolerance
- Generally, you can afford more risk with longer term investments and less risk over the short term..
- Whatever level of risk you are taking should not stress you out. Make your risk level something you can live with without it ever causing you hardship.
That’s all for this Cryptocurrency Trading for Beginners Guide. But before you go, be sure to sign up the HedgeTrade social trading and predictions app. There, you’ll find blockchain verified trading information from traders with skin in the game!