Cryptocurrency Trading Trends 2021
For centuries, investing has been a reliable way to gain passive income with capital that will work for a person. For about ten years already, a new investment object has appeared in the world. That is cryptocurrency.
What Is Cryptocurrency?
Cryptocurrency is called a form of digital money people use as investments and for online purchases. You exchange real currency, like dollars, euros etc., to buy "coins" or "tokens" of a certain kind of cryptocurrency. This payment system does not use banks to verify transactions. When you want to make a transaction, it will be recorded in an open register. Cryptocurrency is stored in your digital wallet.
Thus, you exchange your money for crypto and use it just like you use real money. In addition, no government or bank controls the process of cryptocurrency emergence, its value, or how it is used by users.
The first cryptocurrency was bitcoin. This currency is the most successful, growing and leading on the market. Besides bitcoin there are about 100 of other world currencies and various investment schemes, which stimulate the prosperity of this industry.
Also, one should be aware of the term "token" that is different from bitcoin. A token is a unit of account that is not a cryptocurrency, intended to represent the digital balance in some asset. Tokens can be used for investment purposes, to store value, or to make purchases. Cryptocurrencies have their own blockchains, whereas crypto tokens are built on an existing blockchain.
Best Tools for Cryptos Research
Investing in Cryptos is a risky effort if you don't know how to research and analyze this trading insrtument. All investors need to do research before starting investing. If you are serious about trading, Forex calculators can be also useful.
Each beginner investor needs to know these tools which can be used for cryptos research.
Here is the list of the best tools:
- Messari
- Glassnode
- LunarCrush
- Coin Metrics
- Santiment
- CoinGecko
- CoinMarketCal
- Coin Dance
- CryptoMiso
- Skew
Cryptos Volatility
Volatile currencies allow traders to harvest maximum returns when experiencing price peaks. This is the main reason why many traders prefer trading, for instance, Bitcoin: it offers a lot of profitable opportunities due to its volatility. Bitcoin remains the most searched crypto currency.
Best Cryptos to trade in 2021
- Bitcoin (BTC)
- Ethereum (ETH)
- Tether (USDT)
- Binance Coin (BNB)
- Cardano (ADA)
- Dogecoin (DOGE)
- XRP (XRP)
What trading strategy and best times can be recommended for cryptos
Before you figure out what strategy suites you best try to define some other things as well:
- What mindset are you?
- What is trading discipline?
- Are you an investor or trader?
- How quickly do you want to get profits?
For trading cryptos it is probably better to choose long-term strategies. A calendar of risk events for the Cryptocurrency market, mostly, is not so developed. That's why doing fundamental analysis to develop a day's trading strategy is much more difficult for Cryptos in comparison to other assets. Moreover it is strongly recommended to avoid scalping - the shortest-term strategy.
The most popular cryptos trading advice which suites for beginners is:
Dollar cost averaging (DCA) - The concept of this strategy is simple. Instead of investing all your money in a certain cryptocurrency at the same time, you divide it in small quantities, choose an hour and a particular day of the week and buy them only at these times. Best times to trade cryptos as well as stocks are the first couple of hours after the market opens.
Is it worth investing in cryptocurrency? Pros and cons of investing in cryptocurrency
If you are reading this article, you are trying to figure out whether it makes sense to invest in cryptocurrency.
Among attractive pros are:
- Transactions can be cheaper and swifter.
- A high level of security and absence of inflation and regulation by a single digital bank.
- The unstable economic situation in the world won't strongly influence cryptocurrency.
- More and more people are choosing non-cash payments for goods and services.
- Bitcoin usage is growing rapidly around the world.
- Bitcoin cannot be destroyed.
Top 5 celebrities who own cryptos
Celebrities tend to choose BTC (Bitcoin crypto)!
- Elon Musk (in the bitcoin community Elon Musk seems to the most influential person, he loves not only Bitcoins but Doge as well)
- Jack Dorsey (he is a fan of Bitcoin, doesn’t like Ethereum)
- Mike Tyson (is a new crypto investor, he asked the crypto community what crypto currency is best. Among all the answers he got the answer from Micheal Saylor, MicroStrategy CEO, who believes that Bitcoins is the future of digital property)
- Maisie Williams (BTC)
- Mark Cuban (Bitcoin, ETH, Dogecoin and DeFi)
Cryptocurrency vs Stockmarkets
In the cryptocurrency market, you can apply the same laws and principles as in the stock market, you can calculate risks, choose the right time and strategy for investments. Experts say that the value of cryptocurrencies will definitely grow.
If you believe that cryptocurrency usage will become widespread very soon worldwide, then it probably makes sense for you to buy some crypto. If buying cryptocurrency seems too risky, you can try other ways to gain potential profit from the rise of cryptocurrencies. You can buy the stocks of some reliable companies such as Coinbase, Square, and PayPal.
Probable disadvantages of cryptos
Let's think about the disadvantages of investments. There are no permanent things left in the world. Investors should act very carefully and thoughtfully.
- Cryptocurrency is a relatively new phenomenon with lots of unknowns. We can't say that it is one hundred percent stable.
- All operations in cryptocurrency are irrevocable.
Conclusion
No matter how reliable the sources and expert comments seem, the decision is made by you, and, as a result, only you are responsible for everything that happens with your budget and your future.
Regardless of which cryptocurrency you decide to buy, there are no guarantees of its growth and profitability. But statistics show that the profitability of bitcoin and other leading cryptocurrencies is growing in the long term.
Don't risk all your hopes, dreams, and money into cryptocurrency. Sift through this topic if it appeals to you. Real wealth is usually built gradually and wisely, not by risky investments.
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