2019 marked the year which led to the rise of cryptocurrencies traders.
More and more Millenials and young investors have become skeptical about traditional trading and have opted to invest in cryptocurrencies in the future.
Here are some points which every investor should keep in mind when going for cryptocurrency trading:
Presently, you have 4900 cryptocurrencies enlisted on several exchanges. Basically, the market cap is the size of the company and it provides an insight into the level of risk the coin represents.
This is why it is important to know the market cap of a digital asset before you buy it.
Coins with high market cap and big volume in circulation cannot be manipulated while tokens with a smaller market cap may be affected by positive and negative news.
Before making a buy or trading at brokers like RoyalCBank, investors should see the trading volume of the token too. Majorly this is not an issue with the top 20 coins listen on a crypto platform.
But as a trader, it is important to investigate and choose coins with high trade volumes i.e. which are bought and sold in large numbers on a daily basis.
Higher trading volumes mean you can easily buy and sell digital assets while low trading volume means low liquidity of the coin. Digital coins with highly low trading volume may be a sign of dead coin.
Store your cryptocurrency safe
Once you have decided to purchase the coin, think where and how can you store it safely.
Though you can store the coin on your exchange, the risk is always involved. A lot of investors rely on hardware wallets to safely store their cryptocurrencies which is offline and it can only be accessed by the owner.
There are several software wallets available that give the investors luxury to store their Bitcoin and other altcoins private key with an app that can only be accessed by their devices.
With these points, you can easily start your cryptocurrency trading and become a successful trader in no time. It will help you cautiously trade in the beginning.