Thanks to the rise of cryptocurrency people just don’t look at money the same way. Bitcoin in particular has revolutionized the financial market and has created a trend on cryptocurrencies. The several success stories helped out in making Bitcoin popular which is why many people today aspire to be successful Bitcoin traders.
It’s true that there are many benefits to using Bitcoin. The fact that there’s no third-party regulating means that you’re the only one that has access to your assets. Also, you remain anonymous throughout your transactions and you don’t need to pay any account maintenance fees. But you’re also exposed to many dangers online.
In short, there are pros and cons of Bitcoin, as there are pros and cons of Bitcoin trading. Before you start trading you’ll need to know the basics. Firstly, you should know that this kind of trading is done online at more than one exchange. So, you’ll need to set up an account there. However, don’t go rushing in as there’s still a lot to learn.
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What’s It All About?
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There’s only one thing you’ll need to know about Bitcoin trading and that’s making the right decisions in various situations. This means you’ll need to know how to analyze the market and see which assets are worth your time. Keeping an eye on your investments is also important. There are also various ways of trading that you need to be aware of.
Luckily, several apps can help you out with this. These are trading simulators that will teach you all you need to know about Bitcoin trading. By making use of them you’ll be able to learn the basics of the trade and become a skilled trader.
Alternatively, you can go for one of the many trading platforms. One such example is the BitcoinPrime app which makes important decisions for you. Creating an account is the first step and then you’ll need to make a small deposit which will be your starting budget for trading. After that, you’ll need to go over the tutorials and the demo lesson. Once you’re familiar with how things work then you can try the app out for a live session. Naturally, you can adjust the platform’s settings as you see fit.
Besides the knowledge of the basics of Bitcoin trading and some practice, you’ll also need a place to store your assets in.
The Elusive Bitcoin Wallet
In general, you’ll come across 2 kinds of wallets. These are the hot and cold ones. Since all wallets have private keys, the difference between these wallets is where they keep them. The hot ones do so online. This makes them quite convenient as you can access them whenever you want. But the online world is full of threats to your private key which makes the hot wallets quite risky to use.
That’s why the cold wallets keep the private key offline. They serve as storage for your Bitcoin assets as they can fit in a finite amount of Bitcoin. Still, you can use them to trade your assets online.
External devices such as USBs are used as a cold wallet. There are even paper Bitcoin wallets that keep your private key on a piece of paper making your assets impregnable by online attacks. So, what kind of wallet to go for?
Truth be told, there are plenty of wallets to choose from. The main thing is to find one that suits your needs. Although hot wallets are prone to online threats it doesn’t mean that all brands of hot wallets are bad. Some have multiple layers of security. All in all, do your research before you get one. Once you do, you’ll be a complete Bitcoin trader.
Low Fraud Risks Involved
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Bitcoins offer a fantastic means of doing online transactions. It is controlled by a network that is decentralized and has transparent rules and regulations. Thus, bitcoin provides an alternative method of conducting transactions as compared to central controlled fiat money. According to the researchers, the price of bitcoin will experience a surge shortly.
At the time of cryptocurrency creation, every successful transaction is noted in a public ledger. Also, every bitcoin owner’s personal information is end-to-end encrypted, and all the recorded transactions are legitimate. Since bitcoin is of decentralized nature, it is owned by the public. No bank, organization, or third party has control over bitcoins. Thus, low fraud risks are involved with bitcoins.
Scarcity
One of the significant reasons for maintaining the currency’s value is its supply and demand in the market. When the demand for money is high, the cost of goods increases, resulting in an economy’s collapse. On the contrary, if the demand for money is minimal, it will still create several problems.
As far as fiat currencies are concerned, most government bodies print more money to control scarcity. However, bitcoins are different, and they have a flexible issuance rate that fluctuates with time.
In the first place, the monetary system was designed to satisfy the needs of the physical world. However, the online world is very different from the physical one, and thus the previous rules do not apply now. The Internet has an instantaneous nature, and it is tough for the fiat monetary system to keep up with the internet. Thus, the popularity of bitcoins as a means of conducting transactions will increase in the next few years.
No Geographical Barriers
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Like conventional money, cryptocurrencies are also used for online payment of goods and services worldwide. Users can use it in some areas for investment purposes as well. That being said, bitcoins and traditional currencies are somewhat similar. However, the difference between conventional money and cryptocurrency lies in the fact that, unlike traditional currencies, bitcoins’ value remains the same in every country of the world.
However, the only downside is that cryptos don’t have any physical existence, and in the US, the government has not declared it a legal tender. Moreover, several cryptocurrencies are not supported by any legal entity or the government. It means that the central bank has not determined the supply of cryptos.
It is flexibly operated by the users themselves and doesn’t need intermediary involvement, as is required by fiat currency. Although several countries have legalized cryptocurrencies, transactions using cryptocurrencies are still restricted in several countries. If people try to do so, it may result in jail sentences.
Is Bitcoin Anonymous?
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No, Bitcoins are not fully anonymous. The government agencies and several talented hackers can track anything and everything, which includes Bitcoin as well. Even if bitcoin transactions are anonymous since it is always transferred through peer to peer network, the system cannot consistently hold up.
Just as thieves can steal your wallet, hackers can easily steal your bitcoins from the digital wallet.
