You want to make money trading Bitcoin and internet currencies? Of course. Well, the principle is pretty simple. Buying at a low price and selling at a higher price. That’s it really, in principle.
To do that, you’ll need to follow these 4 steps:
- Creating an exchange account and load it with funds. These will be used to purchase your first bitcoins and digital currency. You will most likely need to verify your ID. Then you’re ready to go. Some exchanges allow smaller trades before you are asked to verify your ID, but it is best to check the terms and conditions of any exchange before joining.
- Open accounts with some of the other exchanges, in various regions. This way you can trade between countries and markets; taking advantage of price differences between them (arbitrage).
- Select a Trading strategy. There are several options here, which we will discuss in detail later. You can day trade, swing trade or trade when markets stabilise. The important thing really is to start. The best way to learn is always through practice.
- Start watching the market for any opportunities. A good, easy place to start is trading the difference between iCE3X and Luno. Both are South African exchange markets. There is nearly always a price difference between the 2 markets. So buying on one, and then immediately selling on another, will yield an instant, easy, profit. Remember, you can trade digital currencies against normal currencies (e.g. ZAR/BTC, USD/BT, EUR/BTC, or, against other digital currencies themselves (e.g. BTC/LTC, LTC/ETH, etc).
There are more than 50 digital currencies listed on some exchanges.
Digital currency trading is very easy, compared to derivatives or futures trading. As always, it is always best to start only with money you can afford to lose and do not risk money you have not earmarked for investment purposes when you planned your budget.