Because bitcoin is a highly speculative asset, many traders find it appealing. The return it promises is amazing, so it drives the interest of the investors. However, the investment must be driven by research.  If done appropriately, cryptocurrency trading may yield substantially larger returns than more conventional investment vehicles.

Naturally, the risk associated with such volatility is much higher than that associated with less volatile assets. If you are confident about crypto investment, this is the right time to begin. For this, you can visit several platforms like this app and start your investment journey.

There are two common motivations for trading cryptocurrencies: either to store value in Bitcoin (BTC) and/or Ethereum (ETH) or to earn a profit in US dollars (USD) quickly. Even in a bull market for cryptocurrencies, increasing your portfolio’s worth in US dollars is easier than increasing your Bitcoin holdings.

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If you trade actively, you can lose some or all of your bitcoin holdings. This is why many Bitcoin and cryptocurrency enthusiasts choose to merely HODL their holdings.

Guidelines for Cryptocurrency Investing

Check out the six simple steps to start investment in cryptocurrency.

1. Open a digital currency brokerage account.

Making a profile with a crypto brokerage is the first step to start cryptocurrency trading. Similar to creating an account at a stock brokerage, establishing an account with a cryptocurrency brokerage will need you to furnish personal identity information. However, you must first filter the best crypto exchange platform for the same. 

2. Putting money into the account.

A cryptocurrency brokerage requires linking your bank account once you’ve joined. The most inexpensive method of funding your account is an ACH deposit (internet bank transfer), which is often free on most sites. Many crypto exchange platforms charge certain fees for this, hence you should check this out before making the final call. 

3. Select a Cryptocurrency.

Professional investors allocate the vast majority of Bitcoin and Ethereum trading money. Trading utilizing technical indicators might be simplified because of these cryptocurrencies’ more stable price action than more volatile altcoins.

As a result, many cryptocurrency investors put some of their money into lesser-known altcoins. Cryptocurrencies with a tiny to mid-sized market value are more volatile than their larger counterparts, but they also have more potential rewards. 

4. Decide your trading strategy

Most cryptocurrency traders evaluate several elements, and there is a wide variety of trading indicators to select from. You should probably get a bitcoin trading course if you’re a beginner investor. In the stock market, you may already have a plan down pat if you’re an experienced trader. Elliott Wave Theory is a widely-used and widely-liked trading approach. 

5. Consider using crypto trading robots.

Automated trading software implements a strategy designed to maximize your returns in line with your specified criteria. The worldwide mania for virtual currencies has also swept India. The Indian government’s position on digital assets has been made clear in the most recent budget, making the possibility of a ban shortly less likely. Even a 30 per cent tax does not seem like much of a deterrent for folks earning a fortune trading cryptocurrencies. 

To what extent does this necessitate urgent investment?

Before putting money into anything, it’s important to research and grasps the fundamentals.

• The cryptocurrency industry is still in its infancy, having just been around for a decade. As a result, it’s significantly riskier and unregulated by regulators. Because of this, getting your money back in the event of fraud or hacking is extremely unlikely. Creating a cryptocurrency that appears real but is a hoax is simple.

• Plan for the long term by setting up various savings and investment vehicles like Fixed Deposits, Equity Mutual Funds, Debt Funds, required Insurances, Emergency Funds, etc. 

• Investigate the market thoroughly before making any investments based on the advice of family, friends, or coworkers. You should be aware, however, that if the investment turns out to be a bust, no one will be able to save your money. Before putting money into them, make sure you understand their possible applications.

• Trade using a reputable platform, as it is not unusual for cryptocurrency trading platforms to be hacked or used to defraud investors.

Do’s and Don’ts while investing in cryptocurrencies.

Do’s:

• Make sure you understand the technology, adoption rate, regulatory landscape, and competitiveness of any cryptocurrency you’re considering investing before investing any money into it.

• It may be prudent to diversify your holdings to limit the risk associated with the fluctuating value of any one cryptocurrency.

• Be aware of market tendencies: maintain a level of familiarity with the crypto market as a whole and the patterns and tendencies that are developing within it. 

• Use stop-loss orders, which sell your bitcoin automatically if the price falls below a particular threshold. Doing so can reduce the potential for loss and maximize safety.

Don’ts:

• The cryptocurrency market is extremely unstable and prone to frequent shifts.

• Don’t trade long-term success for short-term fluctuations in the market. Think patiently and long-term while making any investments.

• Use a trusted cryptocurrency exchange and safeguard your funds by storing them in a secure hardware wallet and activating two-factor authentication.

• Make your own educated investing selections based on your investigation.

• Don’t freak out when the market drops; fluctuations are to be expected. When the market drops, you shouldn’t panic and make rash choices. Don’t lose sight of why and how you’re investing money.

Conclusion

You should learn as much as possible about cryptocurrency investments before making purchases. Because they’re afraid of losing out on huge profits, many people invest their money without considering it. Get your financial house in order with tried-and-true methods first.

Cover Photo by Kanchanara on Unsplash

DISCLAIMER: This article is sponsored and does not substitute for professional advice or help. Any action you take upon the information presented in this article is strictly at your own risk and responsibility.