Hello everyone, dear readers of the Make money trick blog! A few years ago, the global financial market was blown up by cryptocurrency. At first, many did not believe that the virtual currency is able to hold on and, moreover, make a profit. But for a long time now, she not only holds the occupied position, but also constantly moves up. Now the cryptocurrency is on everyone's lips. Novice investors and traders are actively interested in it, realizing that it can be used to make capital much faster than using it.stock market. And today we will learn how to make money on the cryptocurrency exchange and what points should be taken into account.
What is the cryptocurrency market
To begin with, it is worth determining what the sensational cryptocurrency is? It is an electronic exchange mechanism designed as a digital means of payment with decentralized accounting and issuance. In other words, it is virtual money, many users and experts believe that the future of the financial world lies with them.
Indeed, if you look at what part of the funds goes in circulation by bank transfer and how much is used in cash, you will notice that the volume of the former is growing rapidly every year. Cashless payment is more convenient, it allows you to track and analyze your income and expenses. It is much safer, both in terms of personal hygiene and in terms of safety of funds.
But so that the money ends up in a bank account or electronic wallet, they must first be put there through a bank or payment terminals. Often they also shoot for this.commission. The cryptocurrency is not backed by paper tickets or gold. This is a digital code protected by a special cryptographic signature. It does not exist in any other form than electronic.
As soon as they started talking about cryptocurrency, forward-thinking investors immediately appreciated its potential, and in 2010 the first exchange appeared. The cryptocurrency exchange is a multifunctional system designed for the sale, exchange, storage and purchase of digital coins. That is, with the help of the exchange, you can carry out any manipulations with electronic money, including the exchange for fiat (real) currencies.
Crypto exchanges are divided into three groups:
- exchanges that exchange and manipulate different types of digital coins (bitcoin, litecoin, ether, etc.).
- exchanges where cryptocurrencies are exchanged for world currencies (dollar, euro, ruble, etc.).
- exchanges that carry out a full range of cryptocurrency manipulations (they combine the functions of the first and second groups).
Today, the number of digital coin exchanges has grown significantly. Investors are investing money in this area, seeing a steadily increasing demand. But before registering and starting to work on the exchange, it is necessary to clarify with the administration what kind of manipulations can be carried out here.
Many traders who have already tried their hand at the stock and currency exchanges believe that everything is much simpler in the cryptocurrency market. But despite the fact that all exchanges as a whole represent a market and are very similar, the crypto exchange has a number of differences:
Features of trade: On crypto exchanges, currencies move in pairs. Moreover, it can be a pair of digital coins (BTC / ETH), or it can be a digital currency to the world one (BTC / USD). It all depends on the type of exchange. From here comes the peculiarity of forecasting the growth or decline of the currency. If the upper one starts to grow or the lower one falls, then this indicates the growth of the pair.
High volatility: Volatility is an indicator that reflects the change in the price of an asset over a certain period of time. Those changes that occur with real money in the stock market, where quotes can rarely jump 100% in a year. While the cryptocurrency can grow up to 1000%. High volatility holds a bottom line for traders and investors, but it also poses a major risk. Because the currency, like many assets, not only rises, but also falls in value.
Difficulty getting relevant and fresh news: When it comes to world currencies or assets of large holdings, then any changes and fluctuations can be seen on the first lines of any news portal. And their prerequisites appear long before the main event. With cryptocurrency, everything is more complicated - they rarely write about it in the press and hardly talk about it in the news. You can get fresh and relevant news only on specialized portals, forums or blogs. And considering that news is a trader's bread, it is very labor intensive when working with cryptocurrency.
The effectiveness of technical analysis: Despite the high volatility, which, as you know, significantly complicates the construction of a quote forecast based on technical analysis, many traders constantly use it. And most of the time successfully. Although experts argue that the lack of historical statistics, the rarity and irregularity of significant events, constant leaps are not a good basis for analysis, it nevertheless proves its effectiveness from time to time.
Pricing: On cryptocurrency exchanges, the main influence on the price is exerted by the emission of a large volume of coins. That is, you need to anticipate a surge and have time to enter it at a certain stage, before the recession starts. Some players are trying to provoke growth in this way, simulating a currency blowout in order to attract participants from other exchanges.
The cryptocurrency exchange is a relatively new phenomenon, therefore it is fraught with many prospects and dangers. Novice traders and investors should be very careful and thoroughly prepare before joining this uncharted stream.
How to make money on cryptocurrency
There are several ways to make money on cryptocurrency:
Investing: It is considered the safest and most promising way to make money on cryptocurrency. And this judgment is quite justified, given the growth in the cost of digital money and the fact that, despite the fluctuations, the rate is confidently moving up. The essence of the method consists in buying and storing currency, which over time, rising in price, increases the amount of capital. Investing can be long-term or short-term (1-3 months). In either case, a good fat is possible, but in the long term, higher risks.
Trading or intraday / week trading: This is a very short-term investment, the main purpose of which is to generate income from a jump in prices within one or more days. You can make good money on trading, but you can also lose. A trader should be well versed in the algorithm of the exchange, be able to use analytical tools, and make his own forecast. Only with a competent and responsible approach can you make money on trading.
Currency arbitrage: For those who work with cryptocurrency, there is also such a way of earning as arbitrage. Each trader can trade simultaneously on several exchanges. And quotes on crypto-exchanges may differ from each other. And this is a great chance to earn extra money on price differences between exchanges. Buy currency where it is cheaper and sell it on the exchange where it is more expensive. However, efficiency plays an important role here. It is worth hesitating and the perfect moment is missed. Therefore, bots are often used for arbitration.
Margin trading: This is also one of the subspecies of trading. Its peculiarity lies in the fact that leverage is used for transactions. That is, the trader has the opportunity to operate with larger amounts, which allows him to significantly increase the profitability of operations. In a good scenario, the profit from manipulation will more than cover the interest. But there is also a high risk here. Whatever one may say - credit money must be given, as well as interest for their use.
Many newbies are interested in whether it is possible to start working on the stock exchange and make capital without investment. Unfortunately, a crypto exchange is not a fairy godmother, but a financial mechanism. Here you can make money with small investments, but absolutely not without them. It should be understood that the amount of income is directly proportional to the size of the invested funds.
Choosing a cryptocurrency exchange
Another crucial point is the choice of an exchange for trading. Considering that they all have some differences in the type of transactions and quotations. Of course, every investor or trader wants to find the ideal option, because the quality of his future work depends on it. Therefore, when choosing an exchange, you should pay attention to the following points:
The general opinion of users about the exchange: Of course, reviews can also be customized. But if all users write negative comments about the exchange, this is a reason to at least think about and study the resource more carefully.
The size of commissions and fees: Some services are loyal to their users and set adequate commissions. Others, on the contrary, withdraw money for all transactions. The trader should first calculate whether the conducted transactions will pay off, taking into account the commissions.
List of available operations: As mentioned above, the exchange can limit the list of actions with cryptocurrency. For example, work only with digital coins without the ability to exchange them for world currency.
Verification: Responsible and large resources can stretch the verification procedure for several days by requesting additional data. Many traders, not wanting to waste time, are looking for more "accommodating" markets. But in fact, such a thorough verification procedure speaks of the high reliability of the resource, so it is better to wait a little, but be sure of the safety of your funds.
Regional restrictions: Also not uncommon among cryptocurrency exchanges. Before starting work, you should make sure that the exchange operates in the territory of the trader's country. And even better if it supports other languages (Russian, etc.). This will greatly facilitate the further process of work.
Having chosen the best option for himself, taking into account the above criteria, the trader should register and go through the verification procedure. Immediately after that, you can replenish your account and proceed to trading. Let's take a closer look at how the process of trading on a crypto exchange takes place.
Top 3 cryptocurrency exchange platform
- Binance is the leader in global trading volume. Attractively low commission - 0.1%. Supports almost all popular cryptocurrencies and has a large set of analytics and trading tools.
- EXMO is the largest cryptocurrency exchange market. It also has a low commission - only 0.2%. Very fast transfers within the network, just a few seconds.
- Coinmama is another largest crypto exchange. Works only with cryptocurrency, does not support fiat. Mandatory verification is missing.
Trading process step by step
Contrary to logic, it makes sense on a crypto exchange to invest in a currency that has fallen in value. This will make it easier to recoup costs, since over time, the currency will rise in price again, but to break through the ceiling, it will take much longer.
Let's take a step-by-step look at one of the trading schemes:
- We go to the exchange and put a filter, selecting pairs with a negative change in price.
- For the selected pairs, we calculate the volatility for 24 hours. This is done as follows: divide the value of the “High” indicator by the value of the “Low” indicator, and subtract 100 from the resulting number. Currencies with a value of more than 10% are of interest.
- We look at the chart of a suitable currency in dynamics. The following points are of interest: the price of the currency from the very beginning (it is necessary to exclude the price peak), the dynamics of exchange rates for 1-3 months (in general, the movement should be direct or upward), the price change by days and the duration of the jumps (if the currency price regularly exceeds the current one) the cost is at least 5-7%, then this is a good option).
- We place an order to buy currency. In this case, the price limit can be set slightly lower than the current one.
- We are waiting for the price of the currency to rise, and we get our well-deserved profit from the sale (on average 5% minus commissions and fees).
Tips for Beginning Investors
Experienced traders claim that it is easier to trade on the crypto exchange than on the foreign exchange and stock market. But that's what they are experienced traders. And for a beginner, even if this is true, at first it will be difficult to figure everything out. Therefore, it will be useful to heed a few tips:
- Do not invest the entire investment in one currency. Better to use multiple tools at the same time. This will allow you to save at least some of the funds in case of an unsuccessful placement.
- Choose your exchange carefully. Pay attention to the transactions being carried out, the average level of prices and commissions.
- Celebrate successful currencies and don't lose sight of them. Perhaps they will enter the TOP of the best. Check them first the next time you search.
- Develop your own behavior strategy. Do not be exposed to the general mood of the exchange, it may be wrong or act on the decline of the wave.
- React coolly to all changes. Try to avoid impulsive actions. Even after a sharp drop, over time, the price will rise again. And when selling coins at the lower peak, it will no longer be possible to recoup your costs.
- Follow the cryptocurrency news carefully. Take note of the premises. If you follow only the signals, then you can miss the wave. Since they are usually already on the decline of the peak.
- Do not use credit money if you do not have good experience and the necessary knowledge.
Cryptocurrency is a new tool that, if used correctly, will help to make good capital. But a crypto exchange is not a casino where you can hope for your luck. Only careful work, a responsible approach and composure will help you reach the desired income.
It is best of all, before starting real trading, study the thematic literature, practice with a demo account and watch the exchange work in dynamics. This will allow you to delve into the process a little without risking real money.
Related posts
- Top 15 legitimate paid online surveys that pay cash instantly
- "how to make money online without paying anything"
- How to earn a dollar on PayPal
- Earn dollar online - best money making apps.
Post a Comment