Tag: revolution

How To Start Trading Cryptocurrency?

The cryptocurrency market is full of pitfalls. It’s possible to lose money by storing Bitcoin, buying and selling it, and making transactions on and off the exchange. How to get acquainted with this new type of assets, how to avoid losses, and develop your trading skills

Trading and Investing

It is better to start with the world of cryptocurrencies by choosing a strategy. The main ones are investing or trading. The first involves the purchase of an asset and long-term storage. The second is short-term speculation. The trader makes a lot of trades with cryptocurrency, trying to make a profit in a short period of time.

Depending on the chosen strategy, cryptocurrency storage methods differ as well. For investments, cold wallets are better suited. This way you can keep cryptocurrency on your computer or a flash drive. Plus – security, no one can steal cryptocurrency without direct access to it.

Minus – illiquidity. If suddenly, the rate of the coin starts to fall sharply and the user wants to sell it, it will take time to transfer the assets to the exchange. In addition to that, it is possible to specify the wrong address when sending the funds, which will lead to a complete loss without the recovery possibility.

Cryptocurrency Trading

Cryptocurrency trading is a risky business. The price of cryptocurrencies is volatile and can fluctuate by 10-20% per day, sometimes by 50% or more. For inexperienced users that can give an impression that trading can bring in huge profits on a daily basis. However, reality shows the opposite, as a rule, over 90% of newbies lose most of their capital in a short-term perspective and leave the market.

That is why it is necessary to refer to theory. Such as reading the scientific literature on trading, listening to lectures on this topic, attending appropriate courses, getting acquainted with technical and fundamental analysis, or follow cryptocurrency blogs, for example, https://stormgain.com/crypto-trading. All this will not only help you to see the rise and fall of asset prices on charts, but also try to predict them.

Create a free demo account on a StormGain.

Studying the literature and experience of other traders and investors it is also possible to master different trading strategies. One of them is averaging. It involves dividing your capital into several parts and investing small amounts of money in an asset. This method will help you find the best point to buy an asset.

For beginners, it’s better to start trading cryptocurrency with a demo account. Some exchanges allow users to create an account with a virtual balance. This will allow you to understand the market and the exchange’s structure, as well as practice.

Then after that, you can deposit a small amount to the exchange. Losses are inevitable, but it is an obligatory stage of becoming a trader. A beginner must feel what it is like to lose money and hold a losing position. This will help a trader to understand his psychology: whether he is able to tolerate losses and not to make panic, erroneous deals, to control himself and make decisions with a cool head. It is better to gain this skill in advance, without paying a lot of money for such an experience.

Image source: StormGain

How Not to Secure Your Cryptocurrency: Beginner Mistakes

As a cryptocurrency beginner, you’ve likely considered how to keep your cryptocurrency portfolio safe while it appreciates in value. 

After all, if you’re planning to become crypto rich, then you’re going to need a way to keep your portfolio safe.

Fortunately, it has never been simpler to stay safe when investing in cryptocurrencies. But there are some beginner mistakes that you will want to avoid when securing your assets.

Here’s what you need to know. 

1. Don’t Use a Brain Wallet

When you first created your cryptocurrency wallet, odds are were provided with a 12, 16, or 24-word recovery phrase. 

As its name suggests, this phrase (often termed a mnemonic) is used to recover your wallet and any funds it contains, such as if you lost your wallet or the device it was previously stored on. 

Despite its label as a mnemonic, you shouldn’t attempt to simply memorize your wallet, unless you also have a physical backup stored. After all, if you forget your recovery phrase, your funds are almost certainly gone for good. 

Likewise, you may be tempted to simply create your own recovery phrase, using quotes from popular movies, or simply a sequence of words you’re more likely to remember. This is a bad idea. These wallets are incredibly simple to crack and are certainly not secure enough for storing significant sums of any cryptocurrency. 

Instead, always use a randomly generated recovery phrase and keep your backup stored offline in a safe place. 

2. Avoid Custodial Wallet Options

The self-custody of your funds is one of the key tenets of cryptocurrencies — after all, they’re designed to be a decentralized alternative to central bank-backed fiat currencies like the US dollar (USD) and euro (EUR).

Despite this, a large proportion of the most popular cryptocurrency wallets can be described as ‘custodial’. This essentially means the firm behind the wallet holds your private keys for you, meaning you cannot freely use your own funds without their permission, and your funds will be stuck if the service is rendered unavailable for any reason. 

But more than this, custodial platforms have a terrible reputation for being hacked. According to Ledger’s hacks timeline, almost $800 million was stolen from exchanges in 2018 — leaving users out of pocket. 

If you can’t directly access your own recovery phrase or private keys, odds are you’re using a custodial wallet platform. Though they can have their benefits in terms of usability and simplicity, you are entrusting the security of your funds to a third-party. This is not ideal in most cases. 

3. Don’t Pay for a Wallet

The vast majority of cryptocurrency wallets are available free of charge. 

However, there are also a large number of cryptocurrency wallets that are not free, while many of these offer additional features that might justify this cost, others offer only the standard features you could find for free with one of the myriad free wallets. 

As a beginner, odds are you’re not going to need any advanced wallet features that might incur a cost. Instead, try out one of the numerous free wallets available — you will typically be able to find one that offers the features you need. 

In general, some of the basic features you should be looking for in a free cryptocurrency wallet include support for multiple cryptocurrencies; a wide range of security features; built-in exchange functionality; and ease of use. 

Some of the most popular free multi-asset wallets currently include Coin Wallet, Exodus, and Jaxx Liberty. 

Here’s What to do Instead

As a cryptocurrency beginner, you may be tempted to simply pay for the very best of everything to keep your funds safe. 

This might mean paying $100+ for a cryptocurrency hardware wallet or storing your assets on one of the myriad custodial wallet platforms and paying potential subscription fees — due to no other reason than the fact they’re often simple to use and easily accessible.  

But this is not necessary. In the more than ten years that cryptocurrencies have been around, the number of wallet options has skyrocketed. There are now free options that offer features that were only available in premium options just a year or two ago.

Coin Wallet is arguably the best example of this. Despite being completely free of charge, and available on practically every major operating system, Coin Wallet has features that you’d expect from a premium wallet option — such as a built-in cryptocurrency exchange tool, smart miner fees, no address reuse, and strong security. It’s even one of the only cryptocurrency wallets to support FIDO U2F devices like the YubiKey, giving users optional hardware-grade security.

As with all things, before paying for a cryptocurrency product, tool, or service, be sure to consider the free alternatives first — odds are, you’ll find what you are looking for.

Image source: Bitcoin Wiki

What Would it Take For a Genuine Crypto Revolution to Occur

Whether you are a fan of cryptocurrencies and digital assets or not, at the very least you can agree that we are on the cusp of what appears to be a blockchain revolution. Cryptocurrencies are undoubtedly the most high profile of the blockchain-based technologies out there, and the ones that stand to do both the most harm and good, and so are deserving of the most attention. The renewed retail, business, and institutional interest in cryptocurrencies seem like they may be harbingers of something monumental, but what will it take for a genuine crypto revolution to actually take place? 

More Reliable Security

One of the biggest limiting factors when it comes to widespread crypto adoption and use is exchange security. A number of high-profile breaches over the last few years, where thieves have absconded with up to $150 million in coins at a time, makes it hard for investors to trust. What’s more, these losses are not insured like cash savings and investments like equities and bonds. What’s lost is lost forever. 

Exchanges can be hacked via phishing, malware, and traditional hacking methods and while there are a number of things that can be done to mitigate your risks, including making use of two-factor authentication when entering in login information, utilizing hardware wallets, and always using a VPN while trading, the attractiveness of cryptocurrencies to cybercriminals remains even after you have taken the necessary precautions. The untraceability, lack of intermediaries, and decentralized nature of cryptocurrencies–all the features that make them revolutionary–are also the most useful for committing and laundering the proceeds of crime. 

Regulation

Another barrier to widespread adoption and legitimacy is the lack of regulation that currently defines crypto markets and trading. This is the primary dilemma of cryptocurrencies because their power lies in the fact that they are, in important ways, free from state authority. States can ban the use and trading of digital currencies–which Algeria, Vietnam, Saudi Arabia, Qatar, Bolivia, Bangladesh, and several others have already done–but the blockchain is essentially immune to government interference. 

The downside of being able to possess an asset that doesn’t require intermediaries, nor for the owner to identify him or herself and is not confiscable, is that it is essentially anarchy out there. This is not conducive to a stable market, which is what an asset, and most certainly a method of exchange, needs to function widely and properly. 

Improved Liquidity

Liquidity is fundamental to any market and as it stands, most cryptocurrencies suffer from, at best, erratic liquidity. The fact that it can take hours to days to place trades in many coins is a major demerit against crypto assets. Bitcoin is by far the most consistently liquid of all of the coins, and the increased acceptance of Bitcoin as a payment method by brick and mortar stores, online, and increased institutional interest all bode well for its sustained liquidity. 

One of the primary changes that will help increase crypto liquidity is an increase in secure, reliable exchanges where coins can be traded. Many people hold their crypto assets outside of exchanges, which makes sense when you consider the number of hacks and thefts in the last couple of years. More liquidity market makers providing things like better reporting, more stable and reliable data feeds, more competitive spreads and faster trade execution will also go a long way.

Crackdown on Illegal Uses

For all of the utopian talk around cryptocurrencies like Bitcoin, cryptocurrencies continue to enable crime and exploitation. When criminals hack private and public companies and institutions and make off with huge troves of data that they then put up for sale, the preferred method of payment is usually crypto. When drugs, stolen artwork and jewels, and even human beings are sold and trafficked online, again, the preferred method of payment in 2021 tends to be cryptocurrency. 

It will be hard for governments to strike a balance between preserving crypto’s positive revolutionary aspects that draw investors and cracking down on those people using digital assets to make the world a worse place. Both criminals and utopianistic investors like the idea of an intermediaryless world where people can interact and trade with one another without having to pay someone to facilitate the transaction and free from the watchful eye of the state. It is unclear how regulatory agencies and governments will be able to separate the nefarious from the legitimate uses of cryptocurrencies without placing an outright ban on trading (as has been done in the aforementioned countries). 

Conclusion 

Crypto enthusiasts both new and old school believe that human society and its financial systems are already in a tentative new stage of development. Whether cryptocurrencies become fully realized, liberational mediums of exchange many hope for depends on several changes that have yet to take place and answers to problems that appear to have answers that are, as of yet, unclear.

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