Whether you are new to the world of cryptocurrency or you've been buying and trading virtual currencies for years, your goal is the same: making the most out of each trade. Here are some tried and true tips for trading cryptocurrencies:
Do your own research
People who are trading cryptocurrencies often like to join crypto groups on websites and on social media. Unfortunately, notes CryptoVest.com, some of the members of these groups will “shill” or heavily promote certain types of coins or trades, or will claim that a certain type of crypto will skyrocket in value, so be wary of their advice. In some cases, these shills are fake accounts, paid promoters or people who are into creating hype about whatever they are trying to trade.
Rather than falling for the seemingly exciting drama of these posts and their dubious promises of success, do your own research. Understand the coins that you have, how they work, how the prices go up and down and how they have traditionally performed. If you keep a clear head when you are trading, you are far less likely to lose your hard-earned money.
Invest in a smartphone with a fast processor
You'll do at least part of your crypto researching, buying and trading from your smartphone, so it needs to have a powerful processor. If it has been some time since you have upgraded your phone, now's the time to treat yourself to a new phone. The LG G6 features a 5.7-inch display and the phone is powered by a super fast 2.35 GHz Quad-Core Processor.
In addition to using your smartphone to learn more about a particular type of bitcoin or altcoin, you can also download apps that will help you buy and store your crypto. For example, Coinbase is an Android app that allows you to buy and sell digital currency on the go. You can also easily deposit or withdraw money with the app, connect credit and debit cards with your bitcoin, litecoin and ether accounts and you can use the app to instantly sell your crypto with a linked PayPal account.
Be careful about initial coin offerings, or ICOs
A term that you often hear in the world of crypto is ICO, or initial coin offering. Some projects opt for a crowd sale where they give investors the chance to buy a share of the project in tokens or coins for what is supposed to be a good price. The theory is that since the token will be traded from the start on the exchanges, it could make for a nice profit for the ICO investors. While there have been some successful ICOs in recent years, some end up being complete scams and the projects soon disappeared along with the investors’ money.
If you are interested in an upcoming ICO, pay extra close attention to the project and the team behind it. Visit the website—does it look professional or is it full of glaring colors and loud videos? Look for the names of the team of people behind the project—they should list their real names and not cutesy nicknames like Billy Bitcoin or Alice Altcoin. If everything looks legit, consider making a prudent investment in the ICO as opposed to investing a huge amount of money.
Have fun with crypto trading
Just as people who invest with “real” money need to be wise about how they handle their currency, so is the case with virtual cash. By using your smartphone as a helpful tool to learn more about crypto and buying and selling it, to being cautious and careful about each investment that you make and not falling from the hype, it is more than possible for trading cryptocurrencies to be a profitable and fun venture.