You consider cryptocurrencies because you know that its value is increasing. Beyond that, you do not know what it is, how it works and the risks involved. You must learn the basics before you indulge in cryptocurrency trading. Here are the basics about cryptocurrency:
Cryptocurrency is for all
Most people think that cryptocurrency trading is only for the financial elite. You must be aware that with the proliferation of the bitcoin exchange hong kong, anyone can take part in the market. As a beginner, you just need to know how it works.
Compare cryptocurrency trading platforms before using
There is ethereum exchange hong kong but there can only be one that is perfect for you. With this, you need to compare the trading platforms at the onset so you get it right the first time around. When it comes to comparing trading platforms, you should consider the following aspects:
- Location and restriction: you should be aware that the majority of exchanges have limited geographical scope. This means that you can only use platforms legal or accessible from your country.
- Transaction fees: the reason why you considered cryptocurrencies is its lower transaction fees. You need to look around and determine if the fees are reasonable and favorable to you.
- Security: when it comes to security, you have to ensure the measures of the exchange platform are strong against losses and hacks. At the bare minimum, look for exchanges that have two-factor authentication like SMS or Google Authenticator, complex captchas and anonymous sign-ups.
- UI (User Interface): when it comes to UI, you have to observe and determine if it is easy to navigate or use.
- Volume and liquidity: you should look into the volume of trading because it is a good sign of a crypto exchange’s liquidity as well as the overall ability to complete a transaction at any time of the day. As much as possible you should go for a large trading volume.
Trading involves exchanging of currency
When it comes to trading currencies, it usually involves the exchanging of currency that you own and turn it into another kind of currency. You can exchange it back again when there is a price change. In the end, you are hoping for a profit. In fiat currencies, this is called forex market trading.
There are two types of trading strategies
You must be aware that there are two types of trading strategies – long-term trading and short-term trading. Long-term trading involves buying and holding of cryptocurrencies over a long period. In fact, others hold the currency for months or years.
The short-term trading, on the other hand, shuns the stability of long-term trading for the possibility of profiting from price swings. In general, transactions like buying and selling of cryptocurrencies happen in a span of a few days.
There are many things you need to be careful of
If you are not careful, you will find yourself gambling more than trading and eventually, you will lose all your money. Keep in mind that trading is not a game and there is real money to be made if you are being careful.