What Do I Need To Start Trading Cryptocurrency? – Tips For Beginners
It is no surprise that a massive global investors network is deciding to get into the cryptocurrency industry and trade in it. Experts say that the crypto market cap is now about 300 billion dollars with more than 1500 distinct crypto coins. And as the new decade comes in, these numbers have nowhere to go but up.
However, when you are a beginner crypto trader, every little thing may seem puzzling. This is true as the cryptocurrency system itself is different from trading on traditional fiat exchanges.
In this quick read, we will tackle your question, “what do I need to start trading cryptocurrency?” We will provide some tips and tricks to give you an edge among others, too. Let's hop right into it!
Reminders on cryptocurrency trading
- The cryptocurrency exchange is not part of the stock exchange.
- Beginners may opt and prefer to trade cryptocurrency stocks.
- Cryptocurrency trading is a 24-hour market.
- The market is incredibly volatile.
What Do I Need to Get Started?
To start trading, make sure to have the following:
- Any cryptocurrency wallet - paper, mobile, hardware, or software wallets.
- Access to an 'exchange' that lets you buy, sell, or trade crypto.
Choosing the Platform to Invest In
There are a lot of exchange platforms for cryptocurrency, and each is almost different. If you decide to get into cryptocurrency trading, you need to analyze the platforms on the following criteria:
Explore the Platform’s Suggested Cryptocurrencies
Usually, Bitcoin and Ethereum are always available, but there may be problems with less capitalization with other altcoins. Therefore, at this step, it is essential to study which cryptocurrency pairs are available on the site in the inquiry. This will help you learn what assets you can invest in.
Crypto-exchange platforms are not always transparent. For example, many of them have been found to distort the volume of trades largely. Honest company services usually do not hide their data.
Many exchanges are showing off their security systems to their users. The worst thing that can occur is hacking, causing the loss of customer funds. Some exchange systems have started to accept insurance assuring reimbursement in case of such a mishap.
Even though the crypto trade has been steadily getting popular over the past years, there is a problem that the industry can't yet cope with - it is hacking. According to Chainalysis, an entity that helps governments and financial institutions fight money laundering, about $282.6 million was stolen from exchange sites in 2019. Although this is well below the $875.5 million stolen a year earlier (partly because of the higher value of the crypto monitors themselves), there is still insufficient assurance that the money stored in the wallets on the exchanges is safe.
Acceptance for Fiat Money
Of course, be attentive to the sites that work with your national currency. This will help save on commissions, especially if you pay with a credit card.
Top 5 Platforms for Trading Bitcoin
This is a common platform that traders use for Bitcoin and other digital assets. Binance started in China but moved its company headquarters to Malta, one of the best crypto-friendly countries.
This exchange is relatively new in the market, only being launched last 2017, but has made it match the safety, trading, and customer support standards. Take note that these features are only achieved by exchanges that have been around for about a decade.
In terms of trading, Binance has steadily been on the top five highest trading exchanges worldwide.
This company is one of the first Bitcoin trading platforms that still functions today. It presently operates in 99% of all the countries globally, plus 44 states in the United States.
Founded in 2013, Cex.io is registered in FINCEN and prides itself on complying with AML (Anti Money Laundering) policies and KYC (Know Your Customer). Both of these recognize Cex.io as one of the most trusted and safest companies in the cryptocurrency realm.
Just like Cex.io, Bitstamp has been established for quite some time and started in 2011. The platform originally had its operations limited to Europe but has spread its coverage to 78 countries internationally over time.
Bitstamp is famous for its ability to provide for beginner and advanced users with its interfaces: beginner and advanced. The platform is one of the top trading exchanges worldwide with an estimated daily volume of $700 million.
Kraken is a platform that covers globally and has been operating for five years now. Originated in Europe, the exchange provides a range of fiat to Bitcoin trading pairs, including BTC/EUR, BTC/USD, BTC/GBP, and BTC/JPY. Plus, Kraken offers crypto-to-crypto trading pairs, such as BTC/XRP, BTC/ETH, BTC/LTE, among others.
Regarding security concerns, Kraken has some of high-tech security features such as PGP/GPG encryption and two-factor authentication.
Coinbase is among the best-rated exchanges worldwide. They have some of the best security measures and trade only selected coins. Due to their security and quality standards, their expansion of operations to other countries has been slow. Up to this date, the platform operates in 33 countries around the world.
Coinbase is also considered the first regulated exchange to trade Bitcoin, a digital asset that now makes the most significant chunk of daily trading volumes. Click here to know more about trading cryptocurrency!
We hope that after reading this article, you finally found answers on “what do I need to start cryptocurrency?” Along with all the technical stuff that you need to learn before investing, don’t forget that patience is a virtue especially with cryptocurrency.
Read more articles about the mistakes of others so you can avoid doing the same thing. Trading with cryptocurrency are only for those who invest their time and mind. And with the effort that you put today reading this article, we are sure that you can succeed in trading!
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