How to Make Money on Cryptocurrency trade and what’s the best way?
Are you interested in trading crypto? This means you can buy, sell or keep it on the market, depending on what your goal is if you’ve chosen a currency already – great! If not, it’s time to devise a trading plan and get onto it! Here’s our advice on how to make money by trading cryptocurrency.
How to make money on cryptocurrency trade and what’s the best way?
How much do you know about it?
Crypto came to life thanks to computers and the internet, and it’s a form of digital currency that is decentralized.
This is very important and revolutionary because no authority can significantly influence it or control it in any way. Bitcoin was the first crypto to be developed, and it’s still number one and the most popular amongst traders.
Everyone knows about it, whether they are trading or not. Or at least, they’ve heard the name.
It was created thanks to blockchain, a technology that requires lots of power (electricity) and money (since it’s expensive) to mine Bitcoin and that’s why we have investors who make mining possible.
It also takes approximately 10 minutes to mine one Bitcoin, while you need only 2.5 for one Litecoin, commonly referred to as “silver to Bitcoin’s gold”. Bitcoin has a 21 million cap, and once it reaches it, it will stop with production completely.
This is not the case with other top currencies like Ethereum, Ripple, or Litecoin.
Some might have yearly caps, but that’s it. Bitcoin and Ethereum are top two on the list because of their super high volatility, while Litecoin is also a favourite but because their technology makes it a lot easier to mine a coin.
Learn and keep learning
It’s crucial to stay on track regarding news, whether about the trading market or politics and economy in general.
All these can affect the market and currencies significantly, so it’s great to start learning about trading while also paying more attention to the news, if you aren’t used to it already.
It would be best to have a look at the top five cryptos and then research everyone separately.
You will have more insight into how they work, which can suit you best depending on how you want to trade and how much time you have.
Every cryptocurrency has pros and cons, so deciding on one is a good start. It will be easier for you to talk to your broker and adjust your trading plan accordingly.
About crypto brokers
You will need a third-party when you are trading crypto, and that is not a bad thing. Crypto brokers can help you with your trade and give you the information you need, instead of browsing the internet and asking yourself if it is.
To start trading, you will need to open a trading account, which means putting a minimal deposit.
You don’t have to invest that money right away, and a good crypto broker will tell you that before you even mention it.
It will be a lot easier to start with someone with experience by your side because they can even prevent bad decisions.
Of course, it is up to you in the end whether you are going to do something on the market or not, but at least someone will tell you what to expect. Of course, checking the license and certificate is of utmost importance, and don’t even talk to people who don’t have it.
Buying and selling, maybe even holding?
Trading strategies are there so you can make money on crypto trade. There is buying, selling, and holding.
Now, it’s about strategy and timing as well. You can decide to buy crypto, but it would be best when the price drops and then sell it (if you want) when the cost of the crypto you have has gone up.
This can be a short-term strategy but long-term as well. If you tend to buy and sell frequently, depending on time zones, country, like if you are based in Toronto, so Coinformant reviewed the best ones for Canada, and overlapping (where volatility can be the highest), you are a short-term trader.
If you prefer to buy and then hold crypto for a more extended period, and let it sit because you don’t want to stress over it too much, then it’s a long-term strategy.
It depends on your time, general trading strategy and your trading personality.
If you don’t want to make impulsive decisions, you’ll regret later. Maybe it’s better to talk to your broker, see when it would be best to invest in crypto of your choice and then let it sit for some time.
Once you get more experience, then you can start experimenting with short-term strategies. Until then, keep learning, invest smartly, and listen to an expert’s advice!