Bitcoin’s price keeps marching higher and higher, fueling a growing interest in cryptocurrency trading. Around fifteen percent of Americans now own some cryptocurrency, and there are about a million users actively engaged in Bitcoin trading every day. That figure doesn’t even account for trades in other cryptocurrencies, like Ethereum and Litecoin.
With all the interest in crypto, it’s no wonder that more and more people are interested in DIY trading. It’s easier than ever to create a brokerage account and start buying and selling virtual currencies. Even online courses promise to teach you everything you need to know about investing in this new asset.
Self-trading in crypto can make for a wild ride, with the potential for enormous gains. The question is, what’s the cost-benefit analysis? Is DIY trading worth the risk, or are you better off working with a professional?
It can be hard to tease out the pros and cons in heady situations like this one, especially when emotions are running high. With that in mind, this article weighs up the advantages — and the disadvantages — of self-trading the new asset class. You’ll also learn how cryptocurrency trading works, and you’ll find suggestions about the kinds of issues you should watch out for.
How Does Crypto Trading Work?
On the face of it, self-trading crypto doesn’t look very different from trading in stocks. You’ll need to pick a brokerage and create an account. Most platforms will request some form of personal identification, as well as a verifiable form of payment.
It’s a good idea to buy a crypto wallet so that you can store your digital currency, although technically you could decide to leave it all in the exchange if you’re planning on daily trading.
If you’re buying a wallet as a self-trader, be aware of the security procedures involved in setting it up. If you lose your password, you could lose access to all of your digital assets, which is why it’s a good idea to make sure your seed phrase is stored somewhere secure.
Setting up your account is generally quick and uneventful, which means you’re ready to trade almost immediately.
What Are the Benefits of Self-Trading Your Cryptocurrency?
Cryptocurrency is highly volatile, which means that there are constant opportunities for profit. The price of Bitcoin is trending strongly upward, but within that rise, it’s not unusual for the value to rise or fall by a thousand dollars or more in the course of an afternoon.
Trading in cryptocurrency can be a high-energy, even frenetic activity. The market moves dramatically in response to almost any news. Gossip on Twitter, legal rulings, or even the hint of an upcoming change in the way the digital asset is regulated can all send day-traders scrambling to buy or unload their currency.
On the plus side, all of this movement means plenty of chances to turn a profit. At the same time, trading in such a volatile asset means that you’ll need to either be constantly engaged or be willing to sit back and play the long game.
Crypto Is Always On
The cryptocurrency market truly does not sleep. Unlike the stock market, which keeps relatively tame banker’s hours, the virtual currency trade goes on 24 hours a day, seven days a week. That means more opportunities for profitable trades and more chances to swap currencies.
Of course, that endless buying and selling frenzy also means that you have endless opportunities to make a mistake. It’s all too easy to get over-heated and reactive in such a jumpy marketplace. Unless you have an experienced professional on your team, it can be difficult to navigate the ups and downs of a market that just does not pause.
What Are the Dangers in Self-Trading Cryptocurrency?
Every form of investment carries some risk, and crypto is no exception.
Cryptocurrency is highly complex. Besides bitcoin, there are more than four thousand different virtual currencies on the market, each with its own backers who can spin a convincing story about their currency’s likely rise. The extreme volatility associated with crypto can make it hard to untangle truth from fiction since it’s easy to get distracted by a temporary surge or fall.
A general lack of regulation in the market may make it easy for anyone to buy and sell, but it also leaves novice traders exposed to significant risks. This was less of a concern when hedge funds dominated crypto investment, but as individual investments are on the rise, it’s realistic to be more concerned about fraud and theft targeting unprotected new investors.
In Canada, governments have recently tightened regulations for this very reason, warning that “unregistered crypto asset trading platforms expose Ontario investors to significant risks, including potential loss, theft and misuse of their assets. The recent explosion of unregistered platforms has magnified these risks.”
Can Assisted Trading Mitigate These Dangers?
Working with the experienced staff at Coin IRA, a registered, licensed institution since 2017, gives you the tools you need to make your investment smooth, efficient, and accurate.
An experienced trader can guide you at every step, protecting you from accidents or losses resulting from trading mistakes, which are impossible to correct. Established platforms, processes, and settlement processes can protect you from missteps that even the most experienced do-it-yourselfer can fall subject to. Instead of teaching yourself how to trade Bitcoin by poring over white papers and analyzing every new platform or exchange that pops up, you’ll have expert guidance to help educate you and execute your trades in real time with you right there on the phone for final pricing approval.
Security and Peace of Mind
Assisted trading with an experienced firm like Coin IRA will provide you with an extra layer of security. You’ll receive guidance on selecting the best custodian for your IRA, reliable wallet providers for your non-IRA transactions. and best practices for protecting the “keys” to your cryptocurrency. Coin IRA’s Cryptocurrency Sales Specialists are patient and attentive to your individual needs. You’ll also receive confirmation of every transaction carried out, and you’ll be live by telephone with a trader during the transaction itself.
Most of all, working with an experienced trader will give you the benefit of a steady, experienced hand at the wheel, guiding you and protecting your investments.
Investing Through Coin IRA
Adding cryptocurrency to your investment portfolio will open up new avenues of possibility, whether you plan to use the investment to fund your retirement or to achieve a different venture. The experts at Coin IRA will be your personal guides through every step of your new adventure into the exciting and lucrative world of cryptocurrency!