Without a doubt, cryptocurrencies and blockchain technologies in Dubai are one of the most rapidly growing market segments.
Everyone is deeply interested in this trending technology, from early-stage companies to large corporations, often called Digital Gold.
This article will focus on a specific segment of the cryptocurrency market. It means trading cryptocurrencies for profit or short-term speculation.
To get started with trading cryptos, one must have a starting capital. With traditional financial institutions absent from the crypto market, it becomes more difficult for investors to enter into speculative markets without a sound knowledge of how things work there.
Let’s jump right into what you should do to start making money from your investment in the crypto markets.
If you own a few Bitcoins and are planning to start trading, you’ve landed at the right place! Before investing in cryptocurrencies, anybody should first and foremost think: DYOR – Do Your Research.
Steps to help get started with cryptocurrency trading
Get a Cryptocurrency Wallet [or join an exchange]
Having a cryptocurrency wallet helps investors store their digital assets safely without any security worries.
There are many popular wallets, but we recommend hardware wallets for maximum protection.
Also, one can choose from various options available in the market, such as desktop wallets, mobile wallets, web-based wallets or hardware wallets for maximum security.
Join an Exchange
There are several exchanges where you can trade your Bitcoins for other digital currencies. We recommend CEX.io exchange based in the UK and has been around since 2013.
They have an excellent track record of 99.9% uptime, and the user experience on the platform is also excellent.
The next step would be to sign up with them, after which you will be required to go through a 2-step verification process.
Once done, you can use that trading platform to buy cryptocurrencies like Ethereum (ETH), Dash (DASH), Ripple (XRP) and more.
To start trading cryptocurrencies, you should know that the highest daily transactions take place on a few exchanges. Some of them are Bittrex, Coinbase, GDAX and Kraken among others.
There are many different ways to measure liquidity, such as volume or order book depth, so that deeper analysis would require some research.
In any case, your first step is to find which exchanges have enough liquidity for what you want to trade and where you can efficiently move your crypto around without affecting its price too much.
Furthermore, if possible, try spreading the risk over various exchanges – this way, even if one goes down for a short time, you will not lose everything!
After selecting the exchanges, all you need to do is:
Deposit your crypto of choice (usually BTC or ETH) and wait for the deposit to be confirmed. It takes a few minutes, and you can’t trade with those funds during this time.
Once confirmed, fiat currency balances will show up on the Exchange’s user interface, and you can start trading.
Move the coins
If there isn’t enough liquidity in one exchange, move the coins to another exchange where it makes sense.
Then sell them at market rate, so that amount would now be deposited in your account via wire transfer. Repeat until done!
If you are trading Bitcoins or other cryptocurrencies mainly for speculation purposes, consider using 2-factor authentication.
The next thing you should know is the order types available to you.
A limit order means that you can buy or sell your crypto at a specific price – this will be executed right after another trader places an order and matches your price.
If there are no other orders to match yours, it won’t be filled. On-exchange like CEX.IO, their trading platform offers to market, immediate-or-cancel and post-only orders, and stop-loss feature, which goes handy during high volatile movements in prices!
One last thing to know about trading cryptocurrencies is how you can limit your exposure with stop-loss orders!
A stop-loss order lets you pre-define what price point you would want to exit a trade and cut your losses.
For additional information, read more here.