Compare and choose your Bitcoin Exchange
how to trade bitcoin
Bitcoin, a cryptographic currency has been on everyone’s lips since its advent in 2009. Today, millions of lucky owners hold a Bitcoin wallet and with a very prominent unpredictable character, the constant and dazzling evolution of this crypto-currency makes it one of the most profitable investments up to this day.
And with its recent media boom, it is attracting more and more curious investors. This, in turn, contributes to its soaring rise in value.
How to be a part of bitcoins realm?
Interactive Crypto offers a list of the best Bitcoin brokers. This helps potential investor simplify decision making, as well as providing them with relevant information to help them start investing in Bitcoin.
How to make money with Bitcoin?
There are a few different ways to trade this cryptocurrency.
Buy cheap, sell high
There are several ways to make money trading Bitcoin, but the simplest and most obvious way is to buy Bitcoins at a lower price and then resell them a few days later, at a higher rate to make gains on your investment.
We are talking about short-term trading for these case-scenarios. This type of trading requires constant analysis work and there are two major rules of thumb. First, never buy in periods of rising prices and second, never sell in times of decline. The difficulty with this type of short-term trading lies in predicting price variations.
Mid-term and long-term trading
You can also make money with Bitcoins by keeping them for longer periods of time before reselling them. This usually requires a considerable investment and only through a very thorough study of the exchange markets will we be able to see whether the value of Bitcoin will increase significantly in the future; and if it is therefore beneficial to keep the investment longer. This is the most recommended method to for beginners just starting to trade Bitcoin. It is important to stay current with any news or trends, especially on Bitcoin trading platforms and social networks. This helps to monitor the progression and evolution of cryptocurrency.
This is probably the most condemned procedure for beginners that are testing out the Bitcoin market. This strategy consists of buying and reselling Bitcoins on the same day and making capital gains. This is almost impossible to do when we consider the highly unpredictable nature of cryptocurrency. That is why this method requires a lot of ‘savoir-faire’ and time.
According to ICO Mentor “An ICO (Initial Coin Offering) is a fundraising method, operating with exchangeable digital assets against cryptocurrencies, during the beginning phase of a project.”
First, the initiating organization of the ICO issues the digital assets known as the “tokens“. Then, anyone who is interested in the project buys in the new tokens in exchange for bitcoins. Subsequently, they can sell tokens on exchange platforms at a rate defined by the law of supply and demand.
How to Buy Bitcoin
Everything starts with the selection of a Bitcoin broker. Please, consult our list of best brokers available on the market. You will be able to make your choice not only based on their scores, and the minimum deposit required to start trading, but also by browsing through the short reviews that we have prepared for each broker.
Here are a few criteria to consider when choosing your Bitcoin broker:
The first thing to consider is always if the broker follows all laws and regulations. If the broker is on the French territory, for example, take the time and check if it is approved by the ACPR to operate legally. Also, check if it is registered on the register REGAFI. If the broker is based in the United States, he must be registered with the Commodity Futures Trading Commission (CFTC).
Also, try to find out about the credibility of the broker by reading reviews and testimonials posted by other users. This will allow you to make the ultimate decision: opt for this broker or look for another one that enjoys greater notoriety.
Once you have verified the integrity of the broker, you must then evaluate the quality of their offer.
As a rule, cryptocurrency brokers create their wealth by using margins. These are in fact, the difference between the purchase and selling price of a cryptocurrency. The difference offered by different Bitcoin brokers can be compared to the commissions made by stock market brokers. You should always try to find the broker that offers the lowest margins, which will give you maximum profit as a trader.
Also, you must be sure that your broker offers the possibility to create a demo account. With this, you can simulate trading. This is a method that allows you – when you are a beginner – to familiarize yourself with the principles of cryptocurrency trading.
The number of cryptocurrency brokers on the market is growing at dazzling speed. This why you must be certain of the information about a broker before you commit to them. Cryptocurrency brokers often work in association with big banks or with smaller, credit institutions. These currencies must have a significant leverage effect to function and be successful. Most cryptocurrencies offer at least a 100: 1 leverage ratio, which is a substantial amount of money. This is precisely why you must do your research seriously about a broker and the strength of their foundation, before making any choice to trade with them.
One more way to make sure your Bitcoin broker has a good reputation is to use the simple and long-standing method of checking the quality and reachability of their customer support. As you would with any other company, it’s imperative to make sure that customer support is truly reliable and responsive.
A broker stands out from other traditional companies by this important obligation of bringing actual results and it needs to be fast. Indeed, whether your problems are more technical or just general, their full support and their resolution time could possibly cost you several thousands of Euros, sometimes more.
In order to create an atmosphere of serenity and security, brokering operations should be controlled and guaranteed by a regulatory authority. Accredited brokers will have to comply with a set of rules that are designed to protect the wealth of investors. This is the essence of regulation.
Similar to the minimum deposit imposed by bank sector, each accredited broker is subject to a “net capital rule”. The law thus obliges him to hold a minimum level of capital in liquid form. This measure is intended to prevent the bankruptcy of the broker and, where appropriate, protect investors. And beyond the obligation to comply with the net capital rule, accredited brokers are also required by law to observe another rule. In most jurisdictions, the broker must keep all his clients’ funds in separate accounts. The purpose of this manipulation is to prevent any use (accidental or otherwise) of the funds for destinations other than the ones which had been expressly provided for them. Some governments have even managed to put in place a number of legal and administrative instruments to allow investors to recover all or part of their funds, even if they were misappropriated.
In the current cryptocurrency market, the majority of brokers offer a wide variety of services. The speculation is actually done through the broker’s trading platform. It is therefore an important decision-making element that needs to be evaluated and tested before placing its funds in the hands of a broker. It is particularly important to ensure that the platform is in compliance with market standards. This includes the availability of real-time graphics, integrated technical analysis tools, live news and constantly updated market data. Some Bitcoin brokers also offer, as part of their services, a technical and fundamental analysis, as well as cost-effective schedules and other useful tools. Always try to make the most of your service trade with your broker. In terms of return on investment, this aspect will make a significant difference.