The number of cryptocurrencies, or “altcoins”, is increasing at a high rate because, unlike with fiat currencies, there is no regulation for forex trading. It goes without saying that the cryptocurrency market can be volatile and this poses some risk for investors. Nevertheless, it is still possible to make money by investing in the right coin. There are a few things you should know before you jump on board though.
1. Popularity isn’t everything
The first thing to remember is that even though a cryptocurrency may be gaining popularity and more people may be getting involved, it doesn’t always mean that the value will increase. That said, greater publicity can attract more investors, which increases demand and therefore the price per coin. However, this doesn’t always guarantee success; you need to find out about the project and what it aims to do before you commit yourself.
2. Do your research using websites that evaluate cryptocurrencies
There are several sites dedicated to reviewing crypto coins such as Cryptocurrency Talk and CryptoCoinsNews , which can help you make an informed decision on which cryptocurrency is worth investing in. You should also have a look at what people are saying about the coin’s social media platforms, their Telegram groups and even forums.
3. Bitcoin is still king
Despite the fact that different cryptocurrencies are gaining popularity, the majority of this market is still controlled by Bitcoin. A lack of regulation means that some coins may be more risky than others when it comes to scams and things going wrong, but this does not diminish Bitcoin’s position as the most profitable cryptocurrency at the moment. Find here.
4. The price of a coin depends on supply and demand
Before you start trading altcoins you need to consider two factors; how many coins exist in circulation and how much interest there is from investors in buying them up. If supply is more limited than demand then the price of the coin will increase, which is why it’s important to do your research on two separate fronts if you want to make money.
5. Gas is a big factor
Most altcoins have a hard cap of how many coins they can create. This means that every time someone buys an altcoin, the supply has to be decreased by the number specified in the code – although this isn’t always carried out in real-time, due to transaction times and processing fees. With this kind of system you need to pay a certain fee in order for your transaction to be processed; gas fees are what are paid for when you spend gas on altcoin transactions.
6. Choose the right trading platform
Transacting in altcoins might seem simple enough, but there are a lot of options to consider. You should look at the different exchanges and decide which platform offers you the best chance of making a profit. There’s no point choosing an exchange that charges large transaction fees or lacks security measures.
7. Choose your exchange carefully
Just as with any other service, you need to choose your altcoin exchange with seo carefully. This isn’t just important for security reasons; some exchanges limit access to certain cryptocurrencies for regulatory reasons and others may have agreed that they will not make transactions to various countries – so it pays to do your research first before opening an account.
8. Use a digital wallet
A cryptocurrency wallet is a digital account that you store your altcoins in. Different digital wallets use different kinds of software, and some use more security protocols than others. Before you join an exchange, make sure you have some kind of cryptocurrency “wallet” to put your coins into so that they are safe; especially if you are planning on doing any long-term trading or investing.
9. Crypto casinos are not like regular ones
You may be tempted to gamble with altcoins if the market is doing well, but the fact is that crypto gambling sites are completely different to regular casinos in terms of how they work. There is no house, so you are basically gambling against yourself.
10. Never invest money you can’t afford to lose
The cryptocurrency market is volatile, which means that if you invest too much into a project or altcoin that fails, you could lose all your money and more. Never gamble with money that you cannot afford to lose; because even if you win, if the market takes a dive then your investment could vanish completely.
11. Don’t put your eggs in one basket
It would be foolish to put all your eggs in one basket when it comes to altcoin trading. You should also consider diversifying your portfolio by looking at other coins and doing some research on them. Not only can you reduce your risk, but doing so will also increase your chances of making a profit.
12. Never use an exchange that doesn’t support altcoins
It is best to stick with the most popular exchanges such as Coinbase or Binance for bitcoin in order to make it easier for you to find potential trading opportunities. But even here, you should check if they only offer Bitcoin trading or if they have altcoin exchanges as well; although this isn’t always the case with crypto exchanges, which is why it pays to do a little research on the available options before choosing one.