Ethereum is right after Bitcoin in terms of top currencies on the trade market. It has begun as a project and evolved to such heights that makes everyone think about where crypto can get in the future. Of course, Bitcoin is mighty, but the significance of Ethereum is different in other aspects. We will focus on how to trade crypto in general, and what you should pay attention to regarding Ethereum.
Why cryptos in the first place?
Many traders like cryptos because they are decentralized, meaning authorities cannot control transactions of any kind as long as you are using digital currency.
When Ethereum was created, the goal of the project was to make blockchain technology accessible to many, who would like to build their decentralized apps, meaning the transactions would be virtually costless and faster. A man called Vitalik Buterin started the Ethereum project, and Ether was another product of it.
Economy within Economy
As we mentioned the primary goal of project Ethereum was a supercomputer that is decentralized worldwide. Since it has many nodes across the globe, it can “rent” its resources to various developers who aspire to create their dapps. Of course, another misconception is that Ethereum is the name of the currency, while in fact, Ether (ETH) is the right term, while Ethereum is the whole concept and project. It can also be traded 24/7, and it doesn’t have a limit as Bitcoin does. It also fluctuates a lot more than Bitcoin, offering multiple chances of gaining profit if you trade.
How do you start trading crypto?
It’s simple, by using the power of the useful old internet. If you are using a digital currency, it’s only logical to look it up and research about it online. A common mistake, and why people are hostile towards it, is because they didn’t invest enough time, or rather none at all to see what’s it about. Scams are often like any other business, so to prevent that it’s best to look up certified websites and look if the company you want to collaborate with is on the list of certified brokerage firms. Brokers can also be found easily (if they’re not scammers). They usually have several platforms, and reviews are there to help you decide whether they are good or bad. Nevertheless, a certificate and a licence is a must to proceed without having to worry about being scammed.
Making a solid trading plan
You need to have a goal to know what to talk about with your broker and set some priorities when it comes to trading. Consider this as an investment, since you are trading with your own money once you open a live account. There is always a “why” behind someone’s action, and trading is not an exception. Be aware that you are going to start slowly, you will learn a lot (patience is crucial), and your broker will certainly tell you not to invest everything at once. You will see a profit, but it will come with time.
Common Trading Strategies
Holding and active trading are the simplest and most common trading strategies. We will explain a bit of both in the next section:
Holding doesn’t require too much effort, and it’s useful if you are trading for a longer time. The catch is to invest in a currency and then hold it and wait until it’s time to buy more or sell it if the value gets higher and you think it’s the right choice. Pay attention if you are doing this with Ether, though. It’s much more prone to fluctuations, so maybe active trading is a better choice if the crypto you want is Ether. That’s why we emphasize researching the thing you want to invest in and talking to your broker about it before you start.
Active traders have usually experienced ones who are not afraid of loss. That is because they do not invest all of the money that’s on their trading account and they get the sense of how to read the market movements over time. You can benefit from observing the market regularly, following top crypto brokers online and seeing what their advice is while consulting with your broker as well. The main goal is to buy when the price is low and sell when the price is high, which can happen a lot since Ether is fluctuating so much. If you are a beginner, or you don’t like the anxiety of active trading, then it’s maybe better to do a holding strategy for some time. In any case, we wish you luck, and stay informed!