Cryptocurrencies are digital assets following the path of Bitcoin, which was the first of this kind
He knew that I have retired from training people about money, forex trading, cryptocurrencies, and the likes but my friend insists I should write an article, to give my expert view and share my experience, and that's what friends are for, I have decided to create time, not on the weekend but on a Thursday afternoon, after a few hours of reading painfully about the Saudi oil refinery attacks.
I know most people would love to just read, in the first paragraph, how to make the money, but that is never my approach towards these complicated things.
Let me start with quoting The Guardian, "This attack was about Iran demonstrating that it has the means and will to execute exquisitely precise attacks on the most vital oil infrastructure in the world by far," said Robert McNally, a former national security adviser to George W Bush, and now president of the Rapidan Energy Group. "And they can come back next Tuesday or a week from Friday - they can do this again."
War, greed, injustices and all similar wrongs in our world are all financially inclined and they are born from the same mother. Moreover, if I was to bring you to perspective, that's why Bitcoin was "invented" in 2009 because "Satoshi Nakamoto" believed that the world should be different. There should be fairness, care and concern for others and generally speaking, that our world can be restored from all the madness going on.
I am very sure many people have not read the bitcoin white paper, they only hear about bitcoin on media especially in the news, when something major has happened; while others hear about Bitcoin when actually someone is talking about something "similar" to bitcoin.
Since we want to discuss about trading cryptocurrencies, I think it's important to understand what cryptocurrencies are, and what trading means, but both of these are very complicated and big topics to discuss, I hope to open the discussion so that as you read you will wish to do some research and share your thoughts from an informed perspective next time you get an opportunity to engage with people talking about these, because they are surely common topics in the money world today.
Cryptocurrencies are digital assets following the path of Bitcoin, which was the first of this kind. Usually, when someone talks about cryptocurrency, I wish they would first focus on bitcoin and understand it well before they talk or even deal with any other cryptocurrency because that's the only way they will do things right. If not, they are likely to be scammed or to mess up.
Bitcoin on its own was formed in 2009 as a possible replacement to the current monetary system, or at least as an alternative currency or store of value. If you made any serious research, you will find relations to this.
However, other cryptocurrencies have emerged for various reasons. Some wish or claim to do better than bitcoin in performance of the above roles, while others are assets arising from blockchain projects. Blockchain is the technology behind bitcoin and now used in the latest technologies that require high-security levels, trust, and fairness, to mention but a few.
When such projects are made, and there's a need for value storage or exchange, a digital asset is born from therein, as a token, a 'coin', credits, etc. So, these are the assets we are talking about, to be traded. How can we trade them? Or, how can we benefit from them?
Trading is exchange of value for value, in my view, so you really need to first understand the reasons why this value thing. We have probably now got an idea that the assets we are talking about have to be real assets, not the so-called Crypto Currencies which are nothing but mere figures written in some websites, as some times can be called "e-value" but if they are not born with value, they have no value and hence can't be exchanged.
That's why you will hear of some cryptocurrencies which "are not listed on exchanges" or which can't be traded etc. However, this topic is deeper for us here, let's just generalise that we need to exchange value for value. You sell something of lower value to get something of higher value if you expect to make a profit. Or, you buy something which you expect that its value will increase and you sell at a profit.
That's simply how to trade cryptocurrencies! Go to an exchange where trading goes on, get to know the asset which is of higher value or whose value is gaining and buy it. Sell it when the price has appreciated and you are making a profit.
How do you know which one is going to gain? When to buy and when to sell...etc are the questions that come to your mind now, I know. You need to learn about the different assets then. I wish to stop this here so that I give light to other factors.
The reason I shared about the Saudi oil issues is not only because I wanted to talk about why Bitcoin was formed, as a decentralised money system not controlled by any governments and so to avoid what the governments are doing to one another, but to also let you know that news is important in trading.
Some assets quickly gain value or lose value in the face of news or such happenings because like we already know, all these assets or currencies or our money is linked to the governments or companies or blockchain projects so an effect on the origin of the asset or currency will obviously affect the value of these assets. That's then very important to know what's going on in the world if you want to be a successful trader.
In Forex trading, which simply means trade in different currencies or exchange of different currencies, the news is very critical. It influences markets grossly and will affect your trading experience grossly. I trade crypto Currencies on Forex platforms/ brokers. Do not be quick to think that I am going off-topic, discussing Forex trading when we are talking about cryptocurrency trading.
If you know how to trade Forex, you will find some brokers which allow you to trade cryptos the "Forex way". More so, your understanding of Forex trading helps you to trade even better in crypto exchanges.
That said, you know that it's important to get deep into understanding money and our world, how they work if you want to be a successful crypto trader or else you will simply never understand what's going on with your trades. Even if you can employ artificial intelligence and robotics in your trading, knowledge is still power, especially when applied.