Trading bitcoin for money
Jul 16, · This trading strategy has become more and more popular in recent times, and that is obvious by the amount of money that is seen in the Bitcoin futures market, and the fact that there are more institutional investment firms now offering Bitcoin Futures Trading options. Oct 23, · In order to trade Bitcoins you’ll need to do the following: Open an account on a Bitcoin exchange (e.g. aicrypto4.de, eToro, Bitstamp) Verify your identity; Deposit money to your account; Open your first position on the exchange (i.e. buy or short sell) That’s Bitcoin trading in a nutshell. If you want a really detailed explanation, keep on reading. Jan 23, · You can either deposit money to an exchange and trade it there, or you can sign up with a regulated cryptocurrency broker and discover the huge variety of bitcoin trading options. If you are only interested in trading bitcoin and other cryptocurrencies, then signing up with a .
Trading bitcoin for moneyHow To Trade Bitcoin For Beginners
A Bitcoin wallet allows a person to buy, hold, and sell Bitcoin straight away — usually through an exchange which can be linked to the wallet. Simply buying, holding and selling Bitcoin is an actual trading strategy, and one of the more popular ones at that. Once you have a Bitcoin wallet, you are then able to purchase Bitcoin through traditional means, like bank payments or card purchases, and from there, you can use you Bitcoin on various platforms that are amenable to different trading strategies.
For instance, a platform like Binance offers futures trading options on Bitcoin and other cryptocurrencies — and that may be the trading strategy you use as the best way to make money off of cryptocurrencies. Then again, PrimeXBT offers margin trading services and that would suit your Bitcoin trading strategy better. Open free account. Bitcoin has been around for over 10 years now, but in terms of it being an investable and tradable asset, that drive has only come recently. The biggest advantage that Bitcoin has over other traditional stocks, bonds, assets and commodities is that it is a volatile market.
Volatility is often seen as a bad thing, but it is a double-edged sword, and for Bitcoin, the majority of its volatility has been in an upwards trajectory making it an asset that offers high profitability.
More so, Bitcoin is easy to acquire and an inclusive asset that needs a person to only own a smartphone and have as little as10 to their name to begin trading. Bitcoin trading is also designed to be easy for these very reasons.
Many of the platforms that offer trading have attempted to make it easy and uncomplicated to attract new users to the space. Bitcoin is also an asset unlike any other. It operates a bit like a digital gold, in that it does not exist in the physical realm and has the properties of gold when it comes to accruing value, but it is also decentralized, which means there is no one entity that controls it. So, when you invest in a stock, your stock price can fluctuate depending on what businesses decisions the company takes, but that does not happen with Bitcoin.
Other advantages to trading in Bitcoin include the fact it has a transparent, immutable ledger to track and trace transactions. It is a scarce resource with there only ever being 21 million in existence, it has low transaction fees which are often taken into consideration by certain trading platforms, and probably — most importantly, Bitcoin is the best performing asset of the last decade by a considerable margin.
This strategy is arguably the easiest , most common, and highly prized Bitcoin Trading strategy. The other big advantage of this method of trading is that it is incredibly simple. There are of course some Cons that come with this strategy though. It is a strategy that comes with risk.
Because the Bitcoin market price is constantly moving, one day Bitcoin price is going up , the next day bitcoin price can drop. If you decide to buy and hold Bitcoin at a certain price point, the price can drop significantly from there and you can lose as much as 80 percent of your investment.
One of the more exciting Bitcoin trading strategies that have become quite popular in recent times is Bitcoin Margin trading. This form of trading offers huge profitability margins as it involves using borrowed funds to place larger trades on Bitcoin. Many merchants accept Bitcoin as a means of exchange, and this has become easier with the issuance of Bitcoin debit cards.
The bandwagon effect of Bitcoin has led to a growing acceptance of the altcoins, and this can be seen in the increasing market activity. Answers to Important Questions — There are some important questions that newbies always ask about Bitcoin.
Here are the major ones you should know:. Is Bitcoin an altcoin? Bitcoin being the first crypto coin, it is not an altcoin. All other coins, but Bitcoin are altcoins ex. There are several ways to make money with bitcoin. A few of them are: trading or long term investing. Bitcoin arose from the innovative work of Satoshi Nakamoto, who laid out the specification and operating methodology.
Satoshi did not create Bitcoin alone, as he worked with other developers on the project. As a result of this approach, Bitcoin operates as an open source and decentralized platform. While many people have wondered whether Satoshi was a pseudonym or a true identity; the answer remains unknown.
Bitcoin is definitely the outcome of a painstaking work that includes the footprints of several people. Bitcoin is created when a computational difficulty is solved on the Bitcoin Blockchain, and this is rewarded through block rewards. Block rewards are given to miners who successfully completed the recognized process that gives rise to a Bitcoin. Block rewards are not arbitrary as they are subject to a verification process built-in as a part of the Bitcoin algorithm.
Bitcoin derives its price from the interplay of the forces of demand and supply. As people increasingly acquire it, the price soars and the inverse leads to a price drop as demand reduces. Bitcoin can then be seen in the likeness of gold or diamond that is scarce in supply. Bitcoin is limited in supply to the tune of only 21,,, and about 17,, of these are in supply at present. It is not known if any change can be made successfully to the underlying framework of Bitcoin; otherwise, it has a fixed supply.
Bitcoin has attracted lots of controversies in the course of the last few months as a result of concerns and misrepresentations. The United States, Europe, and several countries have accepted Bitcoin as legit, and efforts are being made to regulate it.
This is not to say that it faces opposition in a couple of countries. In China, Bitcoin is illegal, and South Korea has also imposed a couple of restrictions on it. A few other countries have come up with laws to restrict its use.
However, an overwhelming number of countries are open to Bitcoin. One important aspect of Bitcoin transactions is the fact that it also attracts transaction fees. While the fees charged might vary according to the processor, transacting in Bitcoin is not free.
When you buy Bitcoin, you have to pay trading fees, and if you exchange it for fiat money, you will incur charges. Bitcoin is stored in an account that you can liken to a Bank account. The difference is that unlike a Bank account, your Bitcoin account is a virtual Bitcoin wallet. There is a unique address for each Bitcoin wallet that is created, and you can use it globally. On a trading exchange, when you create your account, your Bitcoin wallet address is automatically created.
You can choose to leave your Bitcoin on the exchange for trading or withdraw it to a private Bitcoin wallet. There are hardware, online, mobile, paper, web, brain, multi-sig, desktop wallets for Bitcoin. There are different kinds of non-exchange wallets that you can use to store your Bitcoin for security purposes. Every wallet has a public wallet address and a private key used for accessing it.
Your private key is like your password for emails. Bitcoin is safe if you have it stored in your private wallet. There is a difference between storing your Bitcoin in your trading exchange wallet and a private wallet.
Your trading exchange wallet is considered to be risky to store your Bitcoin. When hackers attack exchanges or there is a system breakdown, you can lose access to your Bitcoin. To prevent this, it is advisable to use a hardware wallet for storage. Peaks in an uptrend and throughs in a downtrend form a trend channel, which is a commonly used concept in the technical price analysis. The channels show where Bitcoin is trading at a particular time and compares it to the overall direction.
Price changes are not linear. That is why technical chart analysis utilizes levels of support and resistance — they showcase short-term trends within the overall trend. Resistance shows where an upward trend is expected to pause or rebound. That means that there are many buyers concentrated at that time.
Resistance can be used as an exit point for a transaction. A level of support can be used to predict where a downward trend can pause or rebound. This can be used as an entry point. Market orders are the fastest way to enter or exit a trade at the best price available at the time. However, instant execution means that the price becomes secondary. When you place a limit order, it will only be triggered once Bitcoin reaches the price you set. Thus, you may get a better price if you are patient enough.
Bear in mind that the price should be profitable for you but still realistic. The limit order will not be executed until there is a seller or sellers willing to accept the price that matches yours.
If the market price is lower, it simply will not execute your order. Here are the benefits of limit orders:. However, some aggressive trading techniques do not suit limit orders. In situations when fast execution is more important than the price difference, you should opt for market orders. When you are day trading, the activity on the exchange occurs very sporadically.
Before you commit to any exchange, take your time to fully explore its functionality and thoroughly evaluate the drawbacks. Here are the best crypto exchanges for Bitcoin day trading:. Many traders shared their experiences about their psychological struggles that have caused them losses. If you want to avoid quietly sabotaging your trading profits, adopt the right mindset:. Trading cryptocurrency for profit is a difficult craft in itself. As you can see, future Bitcoin day traders have a lot of learning to do — from the technical aspect of this industry to controlling their emotions.
Day trading may result in considerable profits as well as equally big losses. It is not for everyone.