What Are the Biggest Bitcoin Trading Elements You Should Absolutely Know?
When we hear the word investment, for most they are the first association of cryptocurrencies. In a very short time, cryptocurrencies have become a favorite way of trading around the world. The most famous is bitcoin, which was created 13 years ago. At the time, it was considered a major failure, and the valued maximum value was thought to be equal to the US dollar, which at the time seemed impossible because it was almost worthless (1BTC = $ 0.03). However, the suspicion quickly disappeared, as this currency very quickly exceeded the value of the dollar and continued to grow until March 2021, when a maximum value of $ 60,000 was recorded. Although the value of bitcoin is twice lower today than in March, investing in this currency is still considered profitable.
Without blockchain technology, there would be no Bitcoin and neither would most other cryptocurrencies. In banking transactions between two people, the third party that records the changes in these two accounts is the bank that creates the power and source of income from this perspective to ensure that both parties will not be deceived.
Blockchain provides an alternative to this classic model in a way that eliminates that third-party centralized side and offers a decentralized network of unknown computers that validate transactions based on a specific algorithm. Cryptocurrencies are therefore hidden digital bills designed as a medium of exchange that is not issued by any central body, are not controlled by central banks, and this automatically makes them almost and completely immune to government and state interference and manipulation.
However, before you decide on this step, you need to get acquainted with some concepts and elements.
How can I buy cryptocurrencies?
Today, digital money can be bought in several ways, and some of the most common are in exchange offices and crypto ATMs. The main difference between these two ways is that, when shopping at an exchange office, you leave your personal information, while you do not need anything to buy at an ATM, all you have to do is swipe your bank card and choose the amount you want to buy.
What is the next step?
Storing coins, of course, is just like you would with any fiat currency. But there is one difference, and that is that the wallet, just like the currency, is digital. There are hot and cold crypto wallets. Hot can be desktop and mobile, and what they have in common is that they require internet access. This is exactly what makes them easy to use, but also risky because the internet is a nest of scams. On the other hand, we have a cold hardware wallet that is without a doubt 100% reliable, as does its price. Still, this is something you should look at as a smart investment because it still saves you money.
Trading or mining?
A question to which we will get a different answer from everyone who deals with investing. However, one thing is for sure – trading is easier and takes less time, and you can do it via a mobile phone. There are also many software applications that help you with this, because they use artificial intelligence, and with their help closely monitor the situation on the market. Of course, the most important of all is to find a reliable platform to which you will entrust your money. Bitcoinrejoin.io will help you with that.
Mining is a bit more complex because it also requires serious computer equipment. Of course, it can be mined via mobile phone, but in much smaller quantities. In any case, many run away from it knowing that it consumes enormous amounts of electricity, and is therefore considered harmful to the environment.
What is particularly interesting about cryptocurrencies is that neither the bank nor the government has authority over it, and for these reasons trading and mining are banned in many countries. It is also important to note that they are subject to volatility, that is, a static character that reflects the strength of the change in the value of any valuable asset, such as currency, stocks, or a natural resource. In simple words, this can be called the amplitude of the value fluctuation from the highest to the lowest. Volatility for the trader is considered as important as the weather forecast for the sailor. Thus, volatility is there to analyze the cryptocurrency market from the monthly period, and it is advisable to use quarterly changes to make forecasts and strategies. The volatility of currency pairs per day of the week in the cryptocurrency market can only reflect a short-term trend.
Some of the advantages of cryptocurrencies are at the same time threats of use. Since the vast majority of cryptocurrencies are fully decentralized, there is no central body that oversees transactions. This is why cryptocurrencies including Bitcoin are becoming an increasingly common haven for criminal activity. Every individual, but also a company that has cryptocurrencies in its portfolio, is a potential target of cybercriminals if they do not implement cybersecurity measures.
As we have seen, embarking on cryptocurrencies, as in anything else, can be risky, but also profitable. It is important that every trader does what is up to him in order to protect his digital money. We also can’t help but mention that in addition to bitcoin, there are many other cryptocurrencies worth mentioning, and Ethereum, Ripple, and Litecoin are certainly some of them. Moreover, many investors have a special tactic, which is to allocate the money provided for investment to several different cryptocurrencies, so that they can better resist volatility and, if it occurs, lose only part of the money and save most.
It remains to be seen whether Bitcoin or some other cryptocurrency will reach its full potential and successfully enter the game in the financial markets, or whether some other more successful option will appear. There are currently too many cryptocurrencies, and new ones are coming out every day, so it is almost impossible to predict whether there is already one that will become a more successful competitor in investing in capital markets than Bitcoin and whether it will be able to replace the money.