Chris Lowe - Bitcoin and Cryptocurrency Trading for Beginners: How to Make Money Investing in Crypto Exchanges, Using Technical Analysis, and Reading Trends & Indicators

BITCOIN AND CRYPTOCURRENCY TRADING FOR BEGINNERS

HOW TO MAKE MONEY BY INVESTING IN CRYPTO EXCHANGES, USING TECHNICAL ANALYSIS, AND READING TRENDS & INDICATORS

Table of Contents

Are you exploring the world of cryptocurrencies for the first time? Do you want to become a crypto trader? This guide will lay the basis for you to distinguish how to hurdle into the cryptocurrency world. Learn to differentiate the cryptocurrencies that assist as a means of compensation from the cryptocurrencies that could be integrated into a project's contribution. Avoid beginner mistakes that will cause you to lose all or part of your tokens. Recognize the dangers of trading cryptocurrencies. Get acquainted with cryptocurrency handovers among wallets made by means of public wallet keys. This book will reply to all your questions. It will tell you when it was invented, how it works, and why it's going to be so important in the future. In the end, you will be able to answer the question, What are cryptocurrencies?, explain the steps to follow to move from euros in a bank account to storage in a private wallet by purchasing altcoins on an exchange platform. You will also find the answers to the main questions that new crypto traders ask themselves. The world of cryptocurrencies moves fast, so there is no time to waste. Let us begin!

When I hear a new term, I look up its definition in my dictionary. Cryptocurrency is a new word for most people, so let's write a crypto definition.

Definition of Cryptocurrency

A cryptocurrency is a form of digital money that is also known as virtual currency or cryptocurrency. That means no actual coins or bills exist; all is done online. You can send a cryptocurrency to someone over the Internet without using an intermediary such as a bank. Bitcoin and Ether are the most well-known cryptocurrencies, but new ones are being developed all the time.

Cryptocurrencies may be used to make immediate purchases and stop transaction fees. Some people can purchase cryptocurrency as an investment in the hopes of seeing its value rise.

Cryptocurrency CFD trading

CFD trading is derivative, allowing you to speculate on cryptocurrency price movements without owning the underlying cryptocurrencies. You can go long (buy) if you think the price of a cryptocurrency will go up, or go short (sell) if you think it will go down.

CFDs are leveraged goods, which means that to obtain maximum exposure to the underlying market, you just need to make a small initial deposit, known as margin. Your profits and losses are calculated based on your position's full size, so leverage magnifies both your gains and losses.

Buy and sell cryptocurrencies through a trading market.

By buying cryptocurrencies through a trading market, you acquire the cryptocurrencies. You will have to create a trading market account, contribute the asset's total value to open a position and store the cryptocurrency tokens in your portfolio until you are ready to sell.

Trading markets have a steep learning curve, as one must become familiar with the necessary technology and learn to analyze the data. Many trading markets limit the amount of deposit, and the accounts can be costly to maintain.

Origin of Cryptocurrencies

Cryptocurrency arose in the 1980s as a result of the cypherpunk movement. With hidden keys that could only be deciphered by those who knew how to decode them, this art defended the widespread use of writing.

David Chaun founded Digicash a decade later to establish a centralized electronic money system to allow for more safe and anonymous transactions. Adam Black proposed Hashcash, a way to control spam and denial-of-service attacks, at the same time.

Although Bitcoin, the first completely decentralized cryptocurrency, did not appear until 2009.

Types of Cryptocurrencies

While there are hundreds of cryptocurrencies available today, traders' interest seems to focus on about half a dozen cryptocurrencies. The list of the most popular cryptocurrencies includes Bitcoin, which is considered the original cryptocurrency. Due to a "hard fork" on its original blockchain, Bitcoin branched out into two additional new digital currencies: Bitcoin Cash and Bitcoin Cash ABC. Other popular cryptocurrencies are frequently traded on cryptocurrency exchange markets and online CFD trading platforms, such as Plus500, including Ethereum, Litecoin, and Ripple XRP.

There are many "forms" of common cryptocurrencies. Bitcoin, Bitcoin Cash (BCH), Bitcoin Cash ABC, and Litecoin are all intended to be fiat currencies. Ethereum, on the other hand, is only meant to be spent on Ethereum's smart contract network, which can also be used to create decentralized apps (Dapps). Ethereum, therefore, is considered more of a "utility token" than a coin. On the contrary, Ripple XRP is used as a blockchain-based payment platform.

Let us start by saying that cryptocurrencies are virtual currencies that allow for financial transactions thanks to complex cryptography that allows for the secure and anonymous generation, storage, and trading of a specific digital token.

Initially, cryptocurrencies were not born to be considered currencies, but they have become so over time.

Satoshi Nakamoto, the one who considers himself the inventor of Bitcoins, simply wanted to develop a peer-to-peer electronic cash system for sharing files.

Nakamoto, unlike all his predecessors, managed to prove that it was possible to have a cryptocurrency without the need for a central authority.

In practice, thanks to the peer-to-peer system, when the transaction has taken place, it will have to be confirmed by the miners. Only miners can confirm transactions. As long as a transaction is not confirmed, it can be forged. Instead, when it is confirmed, the transaction is no longer editable and enters the historical transactions, the so-called blockchain.

When a transaction has been confirmed by a miner, each node must add it to its database.

For this work, miners are rewarded with a cryptocurrency token. This method allows the system to operate securely and consistently over time.

It is quite simple. A Wallet/digital wallet creates and stores the private key (password) associated with a public key (address of the wallet/wallet).

Private keys are basically kept secret and never revealed as they allow you to spend money.

If the private key is lost, you can no longer access the wallet to make transactions or withdraw your coins.

This has been specified before, but I tend to want to voluntarily emphasize and reiterate fundamental concepts.

When we initiate a transaction with any cryptocurrency, all we do is subscribe ownership of the coins to the recipient's address (Public Key).

In a transaction, the software creates a digital signature by processing the transaction using the private key. This makes it extremely secure, as the only way to generate a valid signature for a specific transaction is to use the private key associated with it.

Each Wallet of any cryptocurrency is identified by a specific unique address (public key) consisting of 26 to 35 digits similar to an Iban.

The moment we request a payment, all we have to do is provide this address (public key) to the person who has to make the transaction on our account.

Advantages of cryptocurrencies:

• Since they are digital currencies and not "paper" money, they cannot be counterfeited.
• The cost of transactions, if compared to that of physical and real coins, is much lower.
• Since they are not subject to controls, every transaction and investment takes place in the complete protection of personal privacy.