You must have heard of investors that are reaping good returns from trading Bitcoin (BTC). And from the hype this cryptocurrency is receiving and the people it has made millionaires, it's no wonder many people are considering becoming investors and traders. Investing and trading Bitcoin, contrary to what popular believe, isn't complicated. All you need is the correct information to kickstart your journey. This guide will provide you with a simple breakdown of the process you need to follow to become a BTC trader.
Bitcoin Trading Steps
Follow this process to start buying and selling Bitcoin successfully:
Step 1: Learn and research
Experienced traders throw around jargon like shorting, holding and pulling the rug. The reason is, they know the ins and outs of trading. Before becoming a trader, take some time to learn everything about Bitcoin, including price fluctuations, what drives them, and the possible gains and risks. You can also pick up trading tips and advice from expert traders on social media platforms and other online forums.
Step 2: Pick an exchange
Once you have established that BTC trading is the way to go, find a suitable exchange platform. There are many exchanges available today. But only the best come with optimum security features like two-factor authentication, affordable fees and intuitive user interfaces. In addition, pick a platform that allows numerous payment options, including debit and credit cards or direct bank transfers.
Step 3: Open an account
To open an account, you need documents like a national identity card or driver's license, a valid passport, bank statement and a tax invoice or utility bill for electricity, gas, etc. All these documents help exchanges gather information and keep records in compliance with government laws and regulations.
Step 4: Get a digital wallet
You need a safe storage option for your BTC. You can store BTC in either of two digital wallets: a hot wallet or a cold wallet. A hot wallet is web-based and requires an internet-connected device such as a smartphone, computer, or tablet. On the other hand, a cold wallet is offline and doesn't need the internet to run.
Step 5: Purchase BTC
Once you have a safe wallet that suits your preferences, you can now deposit money into your trading account and use it to buy Bitcoin. Don't let the prices of one Bitcoin discourage you. They may be relatively high, but you can own as little as 0.00000001 BTC, otherwise known as one satoshi.
Step 6: Start trading
Finally, you can sell or trade your Bitcoin on the same exchange platform or other peer-to-peer platforms. Experienced traders use various trading strategies. For example, you can become a day trader by opening and closing positions on the same day or hold your coin and wait for the opportune moment to sell in the future. Familiarize yourself with the trading strategies available and pick one that suits you.
Utilize these tips when you want to buy BTC cryptocurrency.