The crypto mania is sweeping the world of finance as more and more people are looking to join the ranks of crypto users and traders. The benefits are many and the profit potential is interesting. So, you might be looking to tag along.
But before you do, you’ll need to get into the basics of crypto trading as well as cover the concept of cryptocurrencies, not just dive in just because the majority is interested in this concept. You’ll also need to know what a trading platform is and why you need a crypto wallet. In short, you’ll need to learn a bunch of stuff before starting crypto trading.
Any piece of cryptocurrency is a currency that exists online. It’s virtual so you can’t touch it, but it has some value. This kind of currency can be used like any other, so you can buy and sell stuff with it. To do this you’ll need to establish a link between you and another user or company.
To do this you’ll need 2 keys. The public one is there for the link to be established. Once that has happened the transaction can be done and regardless if you’re giving or receiving assets, you’ll need a private key to confirm it. As the final step is complete so is the transaction and the private key makes sure to store it on a ledger.
Blockchain technology keeps track of the transaction and is vital to the survival of cryptocurrencies. This allows users to make transactions without the need to share personal or financial data. Moreover, there’s no third party with access to your assets. It’s only you.
The transactions happen fast and extra fees aren’t charged. Then there’s the profit potential mentioned before. It’s true that the value of an asset can go up, but it can also go down. The thing about this is that it’s connected to volatility, another element of cryptocurrencies you need to be aware of.
Volatility is a risk factor and it can increase the value of your assets or decrease it. So, you should tread carefully when trading. You can buy the assets when their value is low and sell them when it’s high to profit. But how you go about your trading is up to you. Another thing to remember is to be aware of the value of your assets as time passes.
Now that you know the gist of cryptocurrencies, then you can go for the next step which is finding a trading platform. This is a process you need to go through to start your journey as a crypto trader.
Finding a Trading Platform
There are many trading platforms available and picking one is what you’ll need to do to advance your career. Some of them will offer a variety of cryptocurrencies and features, while others will keep it simple. Your best bet is to go for a popular one, or the best trading platform UK has to offer, because these are the ones that have several reasons why they have such a large client base.
You’ll need to find out why that is. Find out how they treat their customers because you might join their ranks. Additionally, do some digging of your own. This is when you dive into the history of the platform and find out if it has a record of online threats and attacks. If this happens to be the case then you’re better off looking for another platform.
Alternatively, you’re set. But you should still be wary of your assets as hackers will look for any chance they can to get your assets. That’s why you need safe storage and the next step of the process is finding a wallet. Just like with the platform, you’ll need to go through the process of finding the right wallet.
Finding a Crypto Waller
Companies all over the world produce crypto wallets for any kind of cryptocurrency. It’s similar to any regular wallet you use for storing your money. There are 2 kinds of storage you will come across online. These are the hot and cold ones.
The hot one is connected to the Internet and grants you access to your trading account and assets at all times. In other words, it’s convenient. This is what you want if you’re looking for convenience, but it also comes with some drawbacks as this kind of wallet is prone to online threats. You’ll be a much easier target for hackers.
So, the other option is the cold wallet. These ones aren’t connected online so you’ll need to access your assets by connecting to the net each time you trade. When you don’t your assets will be safely stored away and no online threats will reach them.
What kind of wallet you go for is up to you. Hot wallets can offer great online security which is just as good as the security of offline ones. Once you’ve done your research you can pick one and transfer your assets there. Then it’s time for the first steps of crypto trading.
