Cryptocurrency is a relatively new concept in finance, and transacting and trading in it has yet not become a piece of common knowledge. Still, investors have been jumping on the crypto bandwagon, principally because of the good returns that it offers.
Dissimilar to trading in shares and debentures, which is governed by government bodies like the central banks and Securities and Exchange Boards, that safeguard the interest of investors, commerce in cryptocurrency is free from any third party control.
Crypto market operations are controlled and governed by the crypto community itself. Though returns on investment in cryptocurrencies can be high, the market is also highly volatile and transactions once initiated, cannot be reversed.
To kick off trading cryptocurrencies, you should first gain adequate knowledge of the subject. And, it is also important to know the associated risks as well as the laws that may apply to you based on your jurisdiction. Let's take a look at the steps to trade cryptocurrency.
Crypto Trading Steps:
1. Sign up with a cryptocurrency brokerage
First of all, you’ll need to make an account with a crypto brokerage like Coinbase, Gemini, and eToro. Just like with a stock brokerage, to open an account with a crypto brokerage you will need to provide personal identifying information like your Social Security number, date of birth, address, and email address.
From the investment point of view, a crypto exchange is just like the stock market. You would like to know that Crypto exchanges function 24 hours and don't have an opening or closing times like normal stock exchanges.
Top exchanges as per coinmarketcap:
Source: coinmarketcap
2. Make a deposit into your crypto account
To fund your crypto brokerage you'll need to connect it with your bank account. Majority of the crypto brokerages offer bank funding via debit cards and wire transfers. Wire transfers are usually the most cost-effective way to fund your account. Wire transfer is free on Coinbase and Gemini.
