Now that you have decided to trade bitcoin, what next? Amidst the noise of the bitcoin price and how much you can gain from it, how can a beginner thrive? Bitcoin trading can be complex for a beginner but with the right knowledge and tips, they can get a hang of it and master it gradually.
Bitcoin has experienced exponential growth over the last few years, especially in 2020 when the number of wallet users grew from 45 million to 63 million. The demand is constantly on the rise and as more people rush to join, here are a few investing tips that can help.
1. Always Start with Research
The first step to investing is to do some research about the asset. This will help you understand what it’s about, how it works, and what to expect in the long run. There is more than enough information about bitcoin on the internet and via other helpful resources.
According to the U.S. Securities and Exchange Commission, public companies are required to provide financial and other information to the public to allow you to judge for yourself whether to buy, sell, or hold a particular security. This gives you access to a wealth of information to keep you on track from the starting point. Take advantage of all that you have at your disposal and gain adequate knowledge about investing in bitcoin before you get started.
2. Choose an Exchange and Wallet
While a bitcoin exchange allows you to convert real money to bitcoin, a wallet allows you to store your bitcoin but some exchanges also provide a wallet. After doing your research, you will need somewhere to store your coins. You can invest with Bitqs or other renowned exchanges but you must first consider certain things before choosing.
Key things to look out for when choosing an exchange include security, transparency, reputation, reviews of past and current users, and transaction fees, among others.
3. Proceed with Caution
It is not unlikely to see a beginner investor trying to take big steps and make the most of the crypto space. This is however often due to the hype around bitcoin and its price. But then, you must understand that bitcoin is a highly volatile asset, which means you could lose a lot as much as you gain a lot.
This is why it is often advisable for beginners to take baby steps when they start. Once you understand how the market works, you can start doing more. Gradually increase the amount of money you invest or trade per time, rather than taking huge leaps from the onset.
These three tips might just be all you need to get started with bitcoin and make the most of it in the long run. You can also consider diversifying your portfolio and invest in other cryptocurrencies apart from bitcoin. This helps with risk management, as other coins are not as volatile as bitcoin. Diversify your money and watch the market closely.