Introduction
Cryptocurrencies were started as the virtual currencies which work in a decentralised format eliminating any dominant authorities in its ways.
But, off-late cryptocurrencies have seen a new high that it has nearly become a rage all over the world. The purpose of these currencies was to stand out of the traditional fiat currencies and central banking systems. Always remember that the cryptocurrency market is ridiculously volatile.
You may have good fortune with the crypto coins value increasing like how Bitcoin price had reached $19.783 last year or it may also witness a drastic low performance in the crypto market.
In the beginning, everything about cryptocurrencies may seem to be overwhelming, just read on below to find out how you can trade cryptocurrencies.
Requirements to trade cryptocurrencies
There are two important things you need to understand to trade cryptocurrencies. They are,
- A cryptocurrency wallet
- A cryptocurrency exchange
A cryptocurrency exchange is a platform like a stock exchange which enables the members to buy, sell and exchange cryptocurrencies for a nominal fee. There are several currency exchanges like Bitbuy, Coinbase, CoinSwitch, Kraken, Shapeshift, Bitsquare and a lot more. These crypto exchanges are all websites which allow peer-to-peer transactions and facilitate in buying, selling or exchange of cryptocurrencies for fiat currency or other cryptos.
Let us first understand about the crypto wallet. Your cryptocurrency wallet stores your digital currency safely. Encrypted passwords protect the cryptocurrency wallets from the predators. A cryptocurrency wallet is just like your bank account to safeguard your money.
There is an array of forex exchange and new platforms emerging now and then. Various combinations to trade can be chosen like ETH to BTC exchange, LTC to BTC exchange and more. It is recommended to choose your cryptocurrency exchange only after a thorough analysis of how a particular exchange works.
Steps to be followed to get started in trading cryptocurrencies
The world of cryptocurrencies may sound like it is registered for only people who are a class apart. But the emerging exchange platforms and an increase in the popularity of the cryptocurrencies have led the way for anyone interested in the cryptocurrencies to trade by following few basic steps easily.
- Beginners must choose a cryptocurrency exchange to get started.
- Analyse the working pattern of the exchange to be chosen and register yourself by following the simples steps in the exchange’s website.
- Then you are all set with your cryptocurrency wallets like Bitcoin wallet or Ethereum wallet initially.
- You can buy cryptocurrencies in the beginning by using fiat currencies like Euros or US dollars.
- Once you connect your bank account to the registered currency exchange, you are entitled to use a debit card or credit card to buy the cryptocurrencies in the currency exchanges.
- It is advisable to buy major performing coins like Bitcoin, Ethereum or Litecoin in the beginning to minimise the risk of losing the currencies overnight.
- Once you have bought some cryptocurrencies like Bitcoin or Ethereum, you can either sell them for fiat currencies back again or exchange them for other cryptocurrencies like Litecoin, Ripple, Dogecoin, Sooncoin and more depending upon the trends of the cryptocurrencies.
Summing Up
There are countless options available online to register and start trading cryptocurrencies. Choose the one best suited for you to be on a safer side. The risk involved in cryptocurrencies can never be overruled. So, believe in your luck for successfully trading cryptocurrencies.
