If you are a beginner and want to learn about all the basics of cryptocurrency, you’re at the right place. While surfing online, you will get a mountain of information that could easily overwhelm you, in fact, even a seasoned trader also. So, to help you out, here we have created a helpful guide to crypto trading for beginners.
What is Cryptocurrency?
In simple terms, a cryptocurrency is a digital form of currency that has no physical form. It is maintained by a decentralized system using cryptography. There is no central authority to govern cryptocurrency. They are traded against specific pairs on cryptocurrency exchanges.
How is Cryptocurrency Different From Conventional Currencies?
There are two main differences between the two – >
- Regulation– Conventional currencies are regulated by a central authority, but in contrast, cryptocurrency has no such authority assigned.
- Existence – Conventional currencies can be traded physically and even digitally nowadays. However, cryptocurrency is only traded online; it has no physical existence.
How Cryptocurrency Came Into The Picture?
The hype of crypto trading for beginners has been noticed recently. But actually, digital currencies have been in existence for more than a couple of decades in different experimental forms. The very first currency which became successful was Bitcoin.
Bitcoin is the first invented and most popular cryptocurrency. It was allegedly created by Satoshi Nakamoto, who released its whitepaper named – “Bitcoin: A Peer-to-Peer Electronic Cash System” in October 2008. He launched the network in January 2009. That’s how it all started, but apart from bitcoin, there are many other well-known cryptocurrencies like Ethereum, Tether, etc.
As per July 2022 data, there are 20,268 cryptocurrencies in existence. However, it is vital to remember that not all cryptocurrencies are active or valuable. If you discount many “dead” cryptocurrencies, then there are nearly 10,000 cryptocurrencies that are active.
Cryptocurrency Trading vs. Investing
Access the crypto investing guides later; first, learn the difference between cryptocurrency trading and investing. Often these two terms are used interchangeably, but there is a significant difference between the two. For beginners, it is vital to know the exact difference so that they can choose the one that matches their interests and requirements.
Although the end goal of both trading and investing is the same – gaining profit from activities. They are different from a time perspective.
In trading, the cryptocurrency is held for a shorter period of time, and the individual expects to make a profit within a short to medium time period. The time duration can range from minutes or hours to a few days or weeks.
Whereas while investing, an individual puts the amount in the crypto market for the long haul. Here the duration can go from months to a year or even more.
What should a Beginner Choose – Trading or Investing?
Whether you choose trading or investing, for both, you have to do ample research and uncover some expert cryptocurrency tips.
However, since you are a beginner, so you would probably want to choose to put money in cryptocurrency from medium to long term range, i.e., trading. This will typically demand more time to research and proper analysis before committing. Moreover, you will have to stay extremely active in the crypto market because the traders make gains from even the slightest change in the market.
It is entirely up to you whether you go for trading or investing in the crypto market. However, for the desired outcomes, it is advisable to follow the cryptocurrency tips and guides available online. To access the best ones, you may reach out to Coin Informer. We provide you with useful guides and important crypto updates.