What is crypto trading?

Before entering the crypto market, you should know what is cryptocurrency and what is crypto trading, to get a better understanding of the market.
Cryptocurrency, also known as crypto-currency or crypto, is a form of currency that exists digitally or virtually in the forex market and uses cryptography to secure transactions of the traders. And buying and selling cryptocurrency by using a crypto trading platform or exchange is known as cryptocurrency trading.

In simple terms, buying a crypto coin on one platform and selling it on another platform, which involves taking advantage of the price variations across the two platforms is what we call crypto trading.

There are thousands of cryptocurrencies available in the forex market.
But some of the best cryptocurrencies are-

• Bitcoin
• Ethereum
• Litecoin
• Ripple
• Solana
• Avalanche Polygon
• Binance Coin
• KuCoin Token

Strategies during Cryptocurrency Trading

Before entering the crypto market, it is very important for the traders to understand each and every strategy involved in the cryptocurrency market.

There are different trading styles that traders can use or implement in the market according to their equity and resources. The four strategies that are mostly used in the market are scalping, day trading, swing trading, and position trading.

Scalping Trading - The scalping strategy in forex is used to describe the system of taking small profits on a frequent basis.

This can be done either manually or via an algorithm that uses guidelines as to when/where to enter and exit positions.

Day Trading - Trade within the same trading day is what we called a Day Trading Strategy. In simple terms, all positions are closed before the market close.
It can be a single trade or multiple trades throughout the day in the market. There are multiple benefits of this type of trading, but most important is the time flexibility.

Swing Trading - A substantial number of trading opportunities are available in swing trading strategy for the traders.

Swing trading is a strategy whereby traders look to take advantage of trending markets and earn their profits.

Position Trading - It is one of the long-term strategies used by the investors where the individual investor holds a position for a long period of time.
Position Trading is a long-term strategy but gives a significant amount of profit to the investors.

Steps in cryptocurrency trading

In cryptocurrency trading, for newcomers and beginners, it is very essential to follow all the steps involved.

Here are some steps which every crypto trader should follow and start his or her crypto journey.

Step 1

Look for Cryptocurrency Exchange

The first step in crypto trading is to decide which platform to use for trading.
In this post, either we can go for traditional brokers or cryptocurrency exchanges. You can choose anyone but you should consider which cryptocurrencies are on offer, what fees they charge, their security features, storage and withdrawal options, and any educational resources.

Step 2

Fund Your Account

After you have chosen your platform, the next step is to fund your account so you can start trading. You can easily add money to your digital wallet by debit card or by wire transfer.

Wire transfers are one of the cheapest ways of funding your account and many crypto exchanges provide wire transfers for free.

Step 3

Choose your Cryptocurrency

After funding your account, now you can choose which cryptocurrency you want to buy.

Most of the traders go for bitcoin or Ethereum or crypto which have an established name. The reason behind choosing these cryptos is that they are easy to predict compared to some other small crypto coins.

Step 4

Choose a Strategy

If you are a beginner, it is advisable to take a cryptocurrency trading course and learn the basics of trading.
Because choosing a strategy is a very important step in cryptocurrency trading which includes fundamental and technical analysis. You can achieve high profits if you follow the right strategy and indicators in cryptocurrency trading.

Step 5

Securely store your Cryptocurrency

Last but not the least, it is important to store your crypto in a right place.

It is advisable to use Cryptocurrency wallets, for storing your digital assets. And cryptocurrency security can be achieved more with hardware wallets as compared to software wallets.

What can you buy from cryptocurrency?

When cryptocurrency was launched, the idea behind it was to be a medium for daily transactions.
But at that time the transactions are very few, but now a number of institutions are taking and accepting cryptocurrencies. So it is possible now to buy a variety of products from e-commerce websites using crypto.

You Can buy luxury goods (Rolex, Patek Philippe, and other high-end watches), cars, and insurance (Swiss insurer AXA) from the crypto and many e-Commerce sites like Shopify, Rakuten, Home Depot, newegg.com, AT&T, and Microsoft.

Overstock is some of the few sites to accept bitcoins.

You can also use a cryptocurrency debit card, such as BitPay in the United States of America if a retailer doesn't accept the crypto directly.

Conclusion

But before you get involved in cryptocurrency trading, one of the most important things that you should know is that Cryptocurrency markets are decentralized, which means they are not issued or backed by a government of any country.

They work through a network of computers. As they are decentralized, they manage to remain free from most of the economic and political concerns that affect any specific currencies of a specific country.