There is still need for an increase in awareness about trading in cryptocurrencies and the cryptocurrency market in mainstream media, with an increasing number every day. Over the past months, the cryptocurrency market has significantly increased from $11 billion USD to the huge heights of $795 billion USD.
The cryptocurrency market is rapidly becoming hard to understand particularly for traders, as there are presently an estimated 1,400 cryptocurrencies available and ICOs are being developed every day. The aim of creating a beginners guide is to make it easier for traders and investors to understand crypto trading and offer them with reliable advice that can be used by people at any level.
To begin with, cryptocurrency is a type of digital currency that has been known to the highly secure and unspecified, with every coin being unique. This makes it possible to ensure that a coin is not used twice by the same individual or institution. Yet, it is important to note that not all coins are unique. Even though there are a couple of ‘privacy’ coins that are unique, other currencies such as Bitcoin are not and hence transactions can be drawn back to an online identity.
Presently, it is quite simple to purchase cryptos. They can be found online on various exchanges, but they have to be bought with a cryptocurrency wallet which is a program that safely monitors all your cryptocurrency. On a daily basis, more retailers accept cryptos and can presently be used on and offline. Retailers such as Apple now accept 10 various cryptos as a form of transaction source on the App Store.
A cryptocurrency exchange definitely is the place where most beginner traders will spend their time. That is the place where crypto owners sell their cryptocurrency for other digital currencies or for traditional money. Yet it is worth noting that you need to find one that works for you and offers you with the insight you need to track, trade and purchase your crypto.
It is up to a trader to decide which cryptocurrency they want. Usually, consumers prefer to take their first step into the crypto market by buying a currency they are familiar with, such as Bitcoin or Ethereum. Yet, it is important to find out more information and what ICOs (Initial Coin Offerings) are up to and whether the project is reliable, in order to avoid crypto-scams.
It is very important to be mindful of crypto-scams and even though there is no way to determine if a project is fake, there are however few tell-tale signs. A viable ICO project will have a detailed whitepaper document which provides everything you need to know about the project. You can start to get worried if the project does not offer the necessary information. This is where once again research is very essential.
With that being said, there are several advantages attached to investing in cryptocurrency. Different from traditional money such as USD, GBP, Yen and so on, cryptocurrencies are not controlled by a bank, governing body or financial authority. Rather, cryptocurrencies depend on the power of the internet to secure its value and confirm transactions. With cryptocurrencies, there is a lower chance for the currency to collapse given its lower-inflation rate.
The best way to invest in cryptocurrency is to do your research, get to know the firm behind the currency and its legal means of making money.