You have probably heard of cryptocurrencies as the new investment trend. In fact, cryptocurrencies have been around for quite some time, yet their great expansion started recently. Crypto became a huge trend because of the fact that a great number of people investing in it with a proper strategy and the amount invested, made a lot of money. It is like a form of passive income, so, basically, you are reversing the principle. Instead of working for the money, the money works for you. Since the story of crypto is legit and approved, we have prepared a useful guideline on how to improve your crypto trading strategy that will certainly pay off.
Learn How to Recognize Scams
It is not easy to recognize genuine cryptocurrencies from scams, given the fact that all crypto sharks are just waiting for you to take your money. They will lure you with the dreamiest offer that will make you want to invest your money. Once you do, all the money’s gone, and you are left hanging. According to some analysis, reports of crypto scams surged to 7,118 in the first nine months of 2021. When compared to 2020, this was 30% of all reports. The average loss per victim was over $20,000.
So, the smartest way to find the best crypto platform is to resist the hype. When you are offered a lot of information about the currency, just take a step back. You need to observe the offer and the project on the platform critically. Some of the questions you need to ask yourself are: how many users of this crypto are out there? What is the problem it solves? You need to learn to avoid the currencies that promise you the earth without doing anything specific.
Zero Fee Crypto Trading
Taking all this into account, you will notice that crypto trading can be quite expensive, especially when you add additional fees to the invested or traded sum. One of the smartest ways to save your money while crypto trading is to choose zero-fee crypto trading exchanges. On the list by HedgewithCrypto, you will notice 8 different zero-crypto trading exchanges that have been tested and compared. The list includes Binance, Phemex, Kucoin, Crypto.com, Digitex, Amplify, Shapeshift, and Lykke. For instance, Binance has been the most widely used crypto trading platform at the time of this writing. It is the world’s greatest exchange spot in terms of liquidity and trading volume. Binance is used by both new and experienced traders. In the beginning, this was the cheapest exchange spot, charging traders just 0.1% per transaction. Later, in July 2022, it was announced to be free for 13 stablecoins and fiat combinations, making it one of the best places for crypto trading without fees.
Manage Your Risks
Once you start investing in crypto, for whatever reason, you will be overwhelmed with tips and tricks on how to trade your crypto. The problem arises when you realize that none of these tips have your best interest at heart. So, you need to play it safe at the beginning so you can avoid the mistakes other people make. Step one is to always set limits on how much you will invest in a certain currency. Once again, it is crucial to avoid the temptation of investing too much and trading more money than you can afford to lose. Honestly, crypto trading is a high-risk business, and people lose their money on a daily basis. We are not saying that you should not take risks, but managing them wisely will certainly pay off.
Keep an eye on the trends
Social media plays an important role in the ups and downs of the cryptocurrency market. It wasn’t long ago when DogeCoin took a boost with just a single tweet by Elon Musk. Therefore, you must follow the market giants on various social platforms like Twitter, Facebook, and Instagram. Doing so will teach you something new every day and may even lead to potential signals for your investment. Moreover, you can also use the latest tools like Doge Calculator, Ethereum Calculator, and many others to get a market edge.
Diversity of the Crypto Portfolio
It will not pay off if you have all of your money invested or traded in a single cryptocurrency. As it is popularly said: Do not put all of your eggs in one basket. Similar to stocks and shares, you need to spread your money out among the various cryptocurrencies. This means that you being over-exposed will make their value increase. On the contrary, cryptocurrency market prices are highly volatile. The main cause of this phenomenon is the fact that there are so many different cryptocurrencies available that you just need to pick the ones paying off. You must do your research if you want to make a good investment.
Long Term Trading
For you to have some serious profit from crypto trading, you need to stay in this world for quite some time. So, you need to be in crypto long-term. Just as with anything else on the internet, you must learn how to stay safe and find positive ways of acquiring the necessary trading knowledge. Certainly, the first thing you will need to learn as a novice is how to analyze the market and see when it is the best time to trade or invest in some new projects. Just as with stocks and shares, prices may rise or fall dramatically within a single day. One of the most common mistakes crypto newbies make is selling their currencies frantically whenever the prices are low. However, crypto will not go away. Keeping your money locked in a currency for months or years can give you the best rewards, as you may observe in the example of Bitcoin.
The easiest way to get into crypto is to compare it with shares and stocks, since there are great similarities between these two concepts, with some great differences as well. However, just as with regular stocks and shares, where you are given a chance to automate your purchases, you can apply the same with crypto to take advantage of pound-cost averaging. Some crypto exchanges, such as Gemini or Coinbase, allow you to automate your purchases. This will enable you to buy a fixed amount of your preferred cryptocurrency every month. Normally, this means you will buy a bit less of the currency when the prices are high, and a little more when the prices are low.
For many reasons, crypto trading has become a huge trend in the past few years. A great deal of capital is locked in crypto and it has become a huge marketplace offering a chance to blockchain developers to come up with projects earning them huge amounts of money. Everyone can trade crypto. All you will ever need is a strategy and some money to trade. The rest is history.