Trading cryptocurrencies in 2020 seems like a good idea, but many experienced traders will recommend you wait for a little because the crypto market is still shaking due to the financial earthquake caused by the coronavirus pandemic. At the same time, that doesn’t mean you need to give up on your idea to become a successful crypto trader. You only need to follow the market for a couple of weeks, see how it works, and how the rates are changing, and then make the decision to invest in something big like this.
Most of the beginners think that the best way to start their trading career is Bitcoin trading. But, you need to be aware that there are more than 5,000 cryptocurrencies there, and they exist on more than 20,000 different markets, trading platforms, and exchange websites. But, let’s focus on the Bitcoin and see how it works, and of course, how to trade them this year.
1. How the Bitcoin changed this year?
The first months of the pandemic were pretty critical for this cryptocurrency. In March, at one point, the Bitcoin was worth $5,025, but after the halving in May, these changes became more stable, resulting in gradually increasing the value, with no huge rises and drops. Today, at the end of August 2020, this currency is worth around $11,500, making it still valuable and ensuring people are still interested in investing and trading. Even though the coronavirus made many markets shaking, the crypto market went pretty well. But, according to advfn, this currency is not the one that will define the market in the future. Many currencies will develop and become even better, and they will take over the market, becoming a huge competition for the Bitcoins.
Probably, many years will pass until that happens, because most of the people still prefer Bitcoin over any other altcoin. But, many experienced traders think that very soon, the other cryptocurrencies will take a huge part of this market, and traders will become more and more interested in Ethereum, Litecoin, and so on.
Anyway, most of the cryptocurrency trading platforms confirmed that they’ve seen an increasing number of trades after the halving in May. That means, the investors and traders still believe in Bitcoins and they are more likely to keep their crypto savings in this currency than in any other. But, maybe 2020 is the year for trying new things and taking unusual risks, so if you are not that into Bitcoins, you can trade some other currency, and if you change your mind, you will be able to exchange your savings for Bitcoins again.
2. What is trading?
This action includes buying, selling, or exchanging one cryptocurrency for another, or for fiat money, according to the place in the world you are located. Many of the traders are comparing it to the forex (foreign exchange). As we said, there are more than 5,000 cryptocurrencies in the market, but most traded are just 1,500 of them, and of course, Bitcoin is in the first place. The second one is Ethereum. Once you understand how these currencies work, you will be able to earn big through the trade platforms available online.
But, in order to trade them, first you need to own some crypto coins or enough money to buy them. The easiest way is to buy them from someone who owns some pile of crypto coins. Then, you store them in your digital wallet, and when you think it’s the right time, you can offer them on these platforms later.
The crypto market is volatile and you need to be aware that there is no stable enough currency. Even the Bitcoin, which is a mainstream choice, had bad times in the past, and there are no patterns of changes you can follow to predict when it will rise again. Also, collecting and piling coins is not a great solution. If you are afraid of these risks, it’s better for you to get more educated on this topic, and then try to invest and trade.
3. What are the most common mistakes people can make at the beginning?
The biggest mistake we can do with our money is to invest all of them in something risky, or to trade everything we have, without leaving anything for us. So, we recommend you to determine the exact amount you are ready to trade at this moment, and if you fail, it won’t be much of a failure for you. Also, always check the amount you are planning to trade because sometimes you can use a decimal point in the wrong place, or type some higher value. You can avoid these mistakes by checking twice before you start the process. Another thing you must pay attention to is the number of the account you need to send the money to.
4. Can I learn how to trade?
You can read a lot of instructions, blog posts, and forums, or follow tutorials and courses, but you can’t say you know how to trade, until you try it for the first time, just by yourself. You can ask some more experienced traders you know for help, but you can say that you know these things when you try them by yourself, taking your own risks and chances. After that, you can say that you know how to trade. But, at the same time, you need to be aware that things are changing every now and then, and you need to follow the crypto-related blogs and news websites.
Trading this year is a challenging process, but as we can see, the Bitcoins are getting more stable rate changes, without big differences, following a line around $11,500 almost every day of August 2020. We recommend you to read a lot of articles related to this, get to know the crypto market the best you can, and of course, to be ready to take the risks and show the world what you know. Maybe one day you will be a recognizable name in the crypto society.