Bitcoin is quite expensive these days. At over eight thousand dollars, I am sure not everyone reading this can afford it let alone buying in large quantities. This is why this article is about investing the little bitcoin you have in other cryptocurrencies. With a hundred-dollar worth of bitcoin, you can get large quantities of smaller coins and sell when there is a rise in price, making appreciable gain within a short period. In this piece, I will share with us on how to trade cryptocurrencies.
I am sure most of you reading this have heard about cryptocurrency trading but only a few know how to go about it. This is why I decided to write this piece. I will try to make it as practical as I can. In the year 2009, Bitcoin sold for less than a dollar. In January this year, it rose to twenty thousand dollars, and as I write this article, it sells for a little over eight thousand dollars. Bitcoin is the most popular cryptocurrency out there and understandably so, everyone wants a piece of it. The smart ones will buy it and trade it for other cryptocurrencies. How is that possible? It is called cryptocurrency trading. Read on.
How to start trading cryptocurrencies
To start trading cryptocurrencies, you need to create an account on an exchange platform e.g. Cryptopia.co.nz, blockchain.info, poloniex.com, etc. Fund your bitcoin wallet with up to $100
worth of coins. To fund your bitcoin wallet in cryptopia, do the following:
>> Click on wallet, next to your profile at the top right corner of the screen
>> Click on deposit
>> Choose bitcoin as the currency you would like deposit into your cryptopia account
>> Copy your bitcoin wallet address as displayed to you and send to whoever you are buying the bitcoin from.
Once your bitcoin has been deposited into your wallet, you are ready to start trading. The next step is to visit coinmarketcap.com
What to look out for on coinmarketcap.
All cryptocurrencies that have made it to the exchange market are listed on coinmarketcap.com These are currencies that can be traded. The secret is to look for coins that cost less than $1 and are listed in the top 100 on coinmarketcap. The top hundred coins are the ones with huge market capitalization and have the potentials to rise and remain relevant for a long time. Once a coin of interest has been found on coinmarketcap, head back to cryptopia, click on exchange, market and search for that coin. For example, Dalecoin. Below are the steps involved in the purchase of Dalecoin.
>> Click on exchange>>market>>search for dalecoin>>click on dalecoin
From the image above, the side with the red arrow, lists the Dalecoins that have been put up for sale with the one with the lowest price listed first. The attributes listed with the coins include, price of each unit of the coin, amount of coin the seller has for sale, the total cost of the whole coins the seller is willing to sell. All prices are in Bitcoin. To know the exact amount in dollar, copy the price of the first seller (seller with the lowest price), go to blockchain.info, create an account if you have none, login, click send, and paste the price you copied in cryptopia as shown below:
As can be seen, a dalecoin costs $0.66; that is about 66 Cent. Investing $100 dollars in bitcoin into Dalecoin will give over 100 units of Dalecoin. After the purchase, you can either setup a sell order by fixing a price at which the system exchanges your Dalecoin for Bitcoin on your behalf or you leave it and wait for the coin to rise to an appreciable price. In our case, imagine that this coin rises to over $100 in three months and we decide to sell it. That will be 100 units of Dalecoin multiplied by $100. That will give a whopping $10,000! What can be better than that?
How to you sell your coins
Selling your coin is as simple as buying it. It involves exchanging your coin with Bitcoin and selling your bitcoins to local buyers who will pay you in your local currency. To exchange your coin with Bitcoin in cryptopia, enter the name of the cryptocurrency you want to sell in the search field, click on it and enter the price you would want to sell a unit of your coin, enter the amount of coin you want to sell and click on sell. The key to selling your coins fast is to make sure your price is than that of the first seller listed in sell order. That way, you become the number one. You can also place a sell order by listing a higher price at which the system sells on your behalf. If the coin is worth $1, you can set a sell order for $100. Once the coin rises above $100, the system will activate the sale.
To be successful, in cryptocurency trading, one needs to be a participant and read several materials on it. Some people will ask: what if the value of the coin drops after I have purchased it? Yes, it happens. The key is to leave the coin for as long as it takes, eventually, it will rise again. Some coins are worth well over $80 billion in market capitalization and can not just vanish into thin air. Knowing that you are not the only investor who has invested money on that coin is the key to staying patient and succeeding.
Finally, it cost nothing now to throw in $100 and forget it. Ok, at least act like you have forgotten about it and in six months to a year’s time, make a sale that will probably change your story. American rapper, 50 Cent did it and in January 2018, his Bitcoin bought in 2014 for $400,000 was worth over $8 million! At the time he bought the coins, a Bitcoin was worth $662, in January 2018, it rose above $19,000. I leave you with this: just like the characters in my favorite book, Who moved my cheese, you can choose to act on what you have just read or do nothing. The choice is yours.
Ashioma Michael, a BSc (Computer Science)., MTCNA, CCNA, and CCNP holder with many years of industry-proven experience in network design, implementation and optimization. He has tutored and guided many professionals towards obtaining their Cisco certifications. Mike works as a senior network engineer with one of the leading internet service providers in West Africa.