Cryptocurrency investment has been an intense debate-subject over the past few years. We heard a lot of stories about people who became millionaires overnight. Meanwhile, we also heard stories of people who lost thousands of dollars while they are hoping to get a quick profit!
The fact that you are reading these lines now means that some of these stories have already reached you, and might you have several questions about cryptocurrency investing.
In this guide, we're going to tell you everything about cryptocurrency investment and how to invest in cryptocurrency online like gainful investors.
Want To Join The Cryptocurrency Market?
You can find opportunities in their rising value OR their drop with trading crypto derivatives - contracts that track their change in value (CFDs) !
- 1. The Rise of Cryptocurrency >
- 2. Is It Worth To Invest In Cryptocurrency? >
- 3. What Is Cryptocurrency? And How It Works? >
- 4. Which Cryptocurrency Is Best To Invest In? >
- 5. How To Invest In Cryptocurrency For Possible Profit? >
- 6. Where To Invest In Cryptocurrency? >
- 7. Risks Of Cryptocurrency Investment >
- 8. Cryptocurrency Investment Strategies And Tips >
- 9. Should I Invest In Cryptocurrency? >
Before we get going, let me tell you the story of bitcoin in history. When the geek programmer, Laszlo Hanyecz, purchased “2 pieces of pizza for 10,000 BTC coins On 22 of May 2010. At that time, owning Bitcoin wasn’t attractive. BTC coin’s price was only a few cents, and no store accept BTC.
But two years later, something shocking happened. Starting from 2012, the news websites began to shed light on this story and comparing bitcoin’s pizza price in 2010 and its current price (presumably).
Since then, May 22 of every year has become a day when the Bitcoin community celebrates the most expensive pizza in history.
Interestingly, the guy who got 10,000 BTC for two pieces of pizza ( which cost a mere $25) might have more than $80 million according to BTC price today.
This story is not about pizza; it is about the greatest investment ever seen in our modern times; crypto-investment, Bitcoin, and money!
Bitcoin, The first cryptocurrency which doesn’t subject to any central bank, its price moved from a few cents when launched in 2009 to reach $ 35000 as of today’s price.
All of which have triggered a massive appetite to invest in cryptocurrencies. But the question arises.
In fact, investing in cryptocurrencies could be incredibly profitable. Many investors achieved great returns on their cryptocurrency investments.
However, many people had jumped on crypto-investment with no study, nor understanding of this market, or even any investment plan.
You can imagine what happened! Many of them lost part of their fund or even all of it.
What you don’t know about the cryptocurrency market; although it is highly volatile and high-risk, it can make big profits for those who understand the risks associated with it.
Any investment in this world whatever it is should have a plan, there are some risks, and there are some rules and guidelines that must be followed in order to achieve satisfactory returns.
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Cryptocurrency is digital money that does not have a physical presence, and not like the securities, nor countries' currencies such as euro, dollar, and others.
It is only available online, designed to serve as a means of exchange, allows instant transactions, and it can be transferred without limits anywhere. It uses encryption to secure and verify transactions as well as to control the creation of new coins.
In other words, cryptocurrency is designed to be money that you can trade online, by which you can buy what you want at any time, and the interesting part, cryptocurrency is fast in transactions, low-cost, and provides privacy.
The best part about Cryptocurrency is that it can be used for plenty of purposes like buying, selling, donating, exchange stuff, trading, or even as a hedge against risks. Generally, cryptocurrency has the 4 features as bellows:
● Transaction fees — Cryptocurrency transactions are ultra-low that tend to zero at transferring between wallets.
● Anonymity — cryptocurrencies are based on peer-to-peer, meaning that there is no intermediary or third party between the sender and the receiver, which supports the privacy and security of your transactions.
● Deregulation from conventional banks — No central authority can freeze to your account or confiscate your crypto funds without access to the wallet where you hold your cryptocurrencies.
● Crossing the geographical border borders — Cryptocurrencies can dealing from anywhere and anywhere. It's easy to send money to someone close to you who lives far away from you, without having to comply with bank restrictions or other money transfer companies.
What Is Blockchain?
What makes Cryptocurrency unique is being decentralized, which means that no government, bank, or any institution controls it. But in the meantime, every transaction is recorded and encrypted in a block. This block is linked to other blocks to be a series of blocks that can not be modified called the blockchain.
In other words, Blockchain is a constantly growing list of records called blocks, which are linked and secured by encryption. Each block is linked to the previous block and contains a timestamp and transaction data.
This means transactions can be carried out transparently and reliably without the need to trust brokers or third parties.
The blockchain brings together the three main types of cryptocurrency.
Bitcoin: About ten years ago, the mysterious Satoshi Nakamoto published a Bitcoin white-paper, which describes “A Peer-to-Peer Electronic Cash System.” Bitcoin was the beginning of cryptocurrencies — the beginning of a new era that could cause a revolution in the financial world.
Altcoins：After Bitcoin’s spreading, we have seen launching dozens of cryptocurrency versions. These cryptocurrencies called “altcoins”. Some are defining altcoins as “alternative versions of bitcoin”, referring to any cryptocurrencies other than bitcoin. as altcoins.
Tokens： This type of cryptocurrency is what we just talked about; it is that ‘token’ used on DApps are constructed to use smart contracts technology on blockchains like Ethereum and NEO. That is why Dapps use tokens.
The shocking fact is that the cryptocurrency market has more than 7000 cryptocurrencies to date.
But what dominates the scene and the most famous in the world of cryptocurrencies, is a small list of currencies and most important.
Bitcoin is the beating heart of the entire cryptocurrency market based on the brilliant technology "blockchain." This revolutionary idea of Bitcoin influences most cryptocurrencies.
But Bitcoin still the dominant cryptocurrency, occupying first place in terms of market capitalization. This cryptocurrency has received a lot of attention from financial institutions around the world, which adopted it widely. It also still the best investment place in the cryptocurrency market.
Ethereum is one of the most promising projects in the cryptocurrency market comes with its sophisticated technology. It is launched in 2015 by the talented math guy Vitalik Buterin, and other partners.
Ethereum is the second-largest cryptocurrency in terms of market capitalization, trading volume, and popularity after bitcoin. It is also the fastest cryptocurrency growing — it grew over a thousand times shortly after its appearance and is considered the most active competitor on crypto-market share after Bitcoin.
Ripple has succeeded several times in reaching second place in of top cryptocurrency value for a while before it gets back to third place.
Ripple is a convenient option for banks and financial institutions wishing to take advantage of the potential of blockchain, as the cryptocurrency XRP acts as an intermediary to facilitate financial transactions and reduce processing time, as well as reduce remittance fees.
4. Bitcoin Cash
Bitcoin Cash is what is known as altcoin - a virtual currency that works essentially in the same way as Bitcoin. Bitcoin Cash is just a branch of Bitcoin. It is a result of Bitcoin's hard fork which separated the original blockchain and gave out each blockchain a different governing set of rules.
Bitcoin Cash created to solve the scalability problem of the size of the blocks in the Blockchain, as the capacity constraint has caused the problem of high fees and delays in transactions. That is why part of Bitcoin's community vote for this hard fork, they sought to increase the size of each block in order to improve this scalability problem.
Litecoin (LTC) is similar to Bitcoin in many properties, and it is one of the most veteran and highly popular cryptocurrencies. However, Litecoin is four times faster, with cheaper transaction fees than Bitcoin.
Litecoin now is the fourth largest cryptocurrency with a market capitalization of $ 3,46 billion. Interestingly, some investors have labeled Litecoin as “digital silver,” while they have described Bitcoin as “digital gold”.
Well, we have enough knowledge of crypto investment. Let's turn to our vital part of the article.
According to recent statistics, the United States is adding about 700,000 new millionaires emerge each year, as mentioned in the Credit Suisse Research Institute’s Global Wealth Report. In a similar vein, the ‘Millionaire Traders’ book points out, a large proportion of millionaires around the world reaped their wealth depending mainly on the trading in financial markets. That means tens of thousands of new-millionaires arising every year thanks to trading, and this only in the United States.
Trading provides great opportunities to earn a lot of money, how is that? And, how to trade Cryptocurrency?
Step1: Create an account online ( choose demo or live account)
Step2：Search the markets you want to trade, such as BTC/USD
Step3：Open a long or short position
Step4：Set up your position size, take profit, stop-loss, etc.
Step5：Confirm the trade
Mitrade is an innovative and simplified CFDs trading platform, providing users a quick and convenient way to trade on global markets, such as Forex, Commodities, Indices, cryptocurrencies, stocks.
This multi-featured platform integrates market updates, trading, news with account management, and risk management, aiming for a better trading experience.
With zero commissions, this platform offers competitive spreads, up to 200 times leverage, as well as fast and reliable order execution.
Mitrade is made for the traders who want to seize the opportunities of markets fluctuating.
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How to read the Crypto chart?
First of all, if you don’t have a financial or technical background and want to involve in the cryptocurrency market, your first steps will be confusing. Therefore, If you want to trade effectively and professionally, you need to know how to read the candlestick chart.
Let's start with the key elements of the cryptocurrency charts.
● Candlesticks (Bearish and Bullish)
To begin with, the crypto charts have two types of candlesticks which are Bearish and Bullish. By default, the bullish candlesticks are represented by green candles, which indicates that the price has increased during the selected time frame. Each candlestick has an opening price, closing price, body, and wicks (which represent the highest and lowest prices).
● Time Frame Selection
In crypto charts, candles cover a specific time frame. So, it is essential at first to choose the time frame that you want to cover candles. This means that the encryption candlesticks will show all the transactions that occurred in the time frame you selected.
For example, if you choose the Bitcoin timeframe for five minutes, each candle will represent 5 minutes for the bitcoin transactions.
Picture: Bitcoin trading on Mitrade
You can choose from default time frames (5 minutes, 15 minutes, 1 hour, 4 hours, daily, weekly, monthly).
The standard crypto chart always displays what called Volume, which represents how much trades executed during the selected time frame.
The longer the volume bar is, the more buying or selling pressure is. A green volume bar will highlight an increased interest in the coin and buying pressure. On the other hand, a red volume bar will highlight a decrease in interest in the coin and selling pressure.
That's was the necessary knowledge to read the crypto charts, we will devote a more detailed guide about technical analysis using indicators, but this part is enough to move to the next point.
Most Popular Ways of Cryptocurrency Trading
Crypto trading is a psychological game by far and more than people expect. It is therefore of paramount importance to choose the method of trading that suits you. Otherwise, it may end up in negative results. To clarify, crypto trading has three main styles:
● Day trading cryptocurrency
Day trading of cryptocurrencies is a type of trading that a trader does during most of the hours of the day, which is a day during periods when the market is more active, as it is no secret that the crypto market has high fluctuations in prices.
Daily trades take minutes to a few hours. It is short-term trading and is generally considered for people who want to monitor and develop their investments at the end of each day. Other commitments as a daily trader are likely to be complicated.
Traders of this type sit in front of the screens watching the market movement throughout the day, continue to search and do several buying and selling throughout the day. They keep their eyes on market trends and act quickly. It is hard-work with high-risks that require an adrenaline rush.
Most of the day-traders I know are youngs who take a large amount of caffeine. If you are not, don’t think of day trading.
● Swing trading cryptocurrency
In swing trading, the trader makes trades and leaves them open for at least one day to close these trades after a few days or several weeks according to the trader's estimation and expectations of price movement.
It is a middle-of-the-line approach between day trading and long-term investment. Swing traders rely mostly on technical analysis and fundamental analysis to make their decisions to enter and exit trades. Swing trading based on trying to predict the direction of the price during the past few days through studying the price movements on the chart on a daily or sometimes even weekly time frame. Swing traders do not consume too much time like daily traders, they do not need to stay stuck to the screen of your computer throughout the day and they have less stress.
You do not need to leave your job to do swing trading. If you are proficient in technical analysis techniques and an expert on how the markets work, you will only need minutes to find opportunities that suit your trading method. Moreover, when you do your trades with a specific and thoughtful plan, you will be farther from tension.
● Long-Term Investing
The long-term trading suits the investor who is willing to take his eyes off the market charts for a while and do other business, it just like buy and hold. Traders do not depend on cryptocurrency trading as a means of livelihood.
Long-term investors are those Hodlers who buy and wait for a long time. They do not care much about what happens during the day or even the week, and vision extends for years.
This type of trading requires a certain amount of trust in cryptocurrency holdings, most likely attained after an in-depth study of the white paper and previous market history of the cryptocurrency of interest.
Let's turn to talk about how to choose the best platform for trading cryptocurrencies.
Before involving in any platform to buy/sell, trade, or hold cryptocurrencies, there are several things to consider, the most important are:
● Regulation — It is important that you open an account in a regulated cryptocurrency trading platform.
● Fees — Before joining, make sure you understand fee-related information such as deposit, transaction and withdrawal fees. Fees could differ significantly depending on the broker you use.
● Trading Options — It is exciting to be able to invest in many financial markets at the same time. The best option is to work with a broker that offers a wide range of markets for trading.
● Easy-to-use — A user-friendly interface is crucial for the trading platform as bad interfaces could confuse the trader, which may lead to some errors or even accidental losses.
● Fast Execution — Some platforms may take several minutes to execute a buy or sell order, and this is not normal; it should take only a few seconds or less.
Some places that match the important features mentioned above
1. CFD brokers
MiTrade Check the details on the trading platform ››
2. Crypto Exchanges
Easy to use
Regulated by ASIC
Slow (sometimes buggy)
Confusing for beginners
Slow (buggy platform)
Confusing for beginners
Consequently, You have to understand these 5 risks and keep them in mind so that they are not easy prey, and also do not lose the money you want to invest in cryptocurrencies.
● Cryptocurrency Scams
The worst thing that can happen to you as an investor in the cryptocurrency market is that you fall victim to the scam, where the fledgling industry is filled with many forms of fraud in one way or another.
In fact, the cryptocurrency market is complicated, confusing to vast of new users and lightly regulated — all of which makes it an ideal target for scammers. As a result, many bad actors exploit this point to do their fraud in order to plunder investors' money.
The most famous cryptocurrency fraud methods that intended to separate investors from their hard-earned money including, but not limited to: Scam Coins, Fake News, Fraudulent ICOs, Phishing, Mining scams, Ponzi Schemes, Money Transfer Fraud, Malware, Fake Apps & Scam Softwares, plus fake exchanges and wallets.
● Regulatory Issues
Authorities are concerned about a completely uncontrolled financial society. Bitcoin's ability to use almost anonymously is a cause for concern, as that would make it attractive for criminals. They are fear from the decentralization nature of Bitcoin that may be exploited for money laundering and tax evasion.
As a result, Many authorities (or regulators) around the world are still struggling to establish a regulatory framework for Bitcoin. But, just like any new innovative involving to be used as money, regulations regarding Bitcoin will continue to be written and rewritten.
● Cryptocurrency Market Volatility
The cryptocurrency market is experiencing a peculiar state of price volatility. You could make unprecedented gains if you invest in cryptocurrencies at the right time as well as you could make significant losses if you chose the wrong time or the wrong way.
The reasons for cryptocurrency market volatility included a lightly regulated market, investors' feelings like FOMO (Fear of missing out) and panics, marketing propaganda, fake news, and scammers.
● Cryptocurrency Market Manipulation
Insider trading, intrigue, and market manipulation are prevalent activities in the crypto market as it lightly regulated, and even though it doesn't conclusively prove there is plenty of evidence that points to manipulation.
cryptocurrencies often shoot up by dozens of percentages in a few minutes to dramatically fall back to their previous levels the following day, what known as pump and dump scheme. As well as sell walls, accumulating cryptocurrency tokens cheaply ahead of positive news and dark pools and other market manipulation tactics.
All of these morally-questionable schemes make the crypto-market so risky for novice investors who are not familiar with the underlying market mechanics.
● Cryptocurrencies' Adoption
With weak regulation of the cryptocurrency market, it is difficult for major international companies to adopt cryptocurrencies in payment, for example. But this is starting to decrease. The adoption of cryptocurrencies is beginning to emerge even though the market is still growing initially.
Some big companies start accepting bitcoin in purchases, for example, Kentucky has started to accept bitcoin in some areas of the world, and in France, they are selling tobacco for bitcoin as well.
● Plan a strategy
Many traders are tracking the latest rumors and chasing the tokens that make a surprise “Pump,” or they just follow uncertain advice from others. Sometimes, they get lucky to make some lucrative deals first, but in the long term, they all fail.
Investing in itself requires many things. At first, you need an entry plan, building your expectations of how much will grow, how long it will take to rise, how much risk is, determining the capital you can invest, the time frame for investment, and finally, the exit plan. These are all the essential questions you should ask yourself before you start investing in the cryptocurrency market.
● Do not put your entire funds in one cryptocurrency
This rule applies to all types of investments, meaning that you have to invest in more than one crypto assets, not only throwing your entire funds in one asset.
● Take profit or stop loss timely
It is wrong to trade without using a stop-loss order. That could be like driving without brakes, which ultimately leads to an unintended result. Stop loss is your safety point.
● Conduct your research
It is disappointing that the cryptocurrency market is ruled by rumors, fear, uncertainty, and FOMO (fear of missing the opportunity). Cryptocurrency trading is a psychological game that you need to excel in.
Learning to do your research is an important life skill and can push you forward if you rely on it accurately. It is about developing your skills in criticism and assessment, recognizing patterns, and balancing your emotional opinions with logical reasons.
● Use logic rather than emotion
● Learn about common scams
● Learn more constantly
● Track your investment result
The experience of investing in cryptocurrencies is one that deserves your trial. But only by being fully aware of all the developments in the cryptocurrency market, you can make plenty of money in a short time.
This post has shown you everything about cryptocurrencies to make money. The opportunities through trading cryptocurrencies do not compare with any project on the ground. Many adults and young people around the world have made impressive gains that others will not be able to get in traditional jobs or projects.
A simple step to get started: Sign up with Mitrade Appto get a unique trading experience in cryptocurrencies and a welcome bonus. Start now and make some wealth!
Risk Warning: CFDs are a leveraged product that can result in the loss of your entire capital. Refer to the PDS to learn the risks involved.
The content presented above, whether from a third party or not, is considered as general advice only. This article does not contain and should not be construed as containing investment advice, investment recommendations, an offer of or solicitation for any transactions in financial instruments. Mitrade does not represent that the information provided here is accurate, current or complete. Mitrade is not a financial advisor and all services are provided on an execution only basis. Before making any investment decisions, you should seek advice from independent financial advisors to ensure you understand the risks. *CFD trading carries a high level of risk and is not suitable for all investors. Please read the PDS before choosing to start trading.