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What do I need to know about Crypto?

Unfortunately, quite a lot,

but we’ve got you covered!

As with learning anything new, there is a lot of information that needs to be absorbed and digested before you will be able to tread water and prevent yourself from drowning. Fortunately, we are here to help and have created this comprehensive beginner guide on Crypto and Blockchain that will bring you up to speed on the different types of technologies, their applications, and teach you how to use them safely!

Here is what we will be covering in this article:

What is crypto?

Cryptocurrencies are digital or virtual currencies that use cryptography for security and are not backed by any central authority, such as a government or a bank. They are decentralized and operate on a distributed ledger called a blockchain, which is a record of all transactions that are updated and verified by a network of computers.

Cryptocurrencies allow for peer-to-peer transactions without the need for intermediaries, such as banks, and they offer a relatively high degree of anonymity.

Examples of the most famous cryptocurrencies, based on usage and market capitalization include:

• Bitcoin
• Ethereum
• Cardano
• BNB,
• XRP
• Tether

That said, not all cryptos are equal and there are all kinds of unfamiliar termonologies like stablecoins, shitcoin, utility tokens, De-Fi, and many more involved that you should have an understanding of before you should consider putting your hard-earned money into them!

We provide a good introduction to all the major players and applications as well as the differences between them a little later, but for now, we will begin with the basics.

TLAT is reader-supported, when you buy through the links on our site, we may earn an affiliate commission. Learn More

What is a blockchain?

A blockchain is a decentralized, distributed ledger that is used to record and track transactions. It is a digital, cryptographic system that is designed to be secure, transparent, and immutable, and it is the underlying technology that powers many cryptocurrencies, such as Bitcoin and Ethereum.

A blockchain is made up of a series of blocks, which are individual units of information that are linked together in a linear, chronological chain. Each block contains a set of transactions, as well as a unique identifier called a “hash” that links it to the previous and subsequent blocks in the chain.

One of the key features of a blockchain is that it is decentralized, which means that it is not controlled by any single entity or authority. Instead, it is maintained by a network of participants, who use their computing power to validate and verify transactions on the network. This distributed, decentralized architecture makes it difficult for any single actor to manipulate or interfere with the data on the blockchain.

Another key feature of a blockchain is that it is transparent, which means that anyone can view the data on the network. However, the data on a blockchain is encrypted and secure, which means that it is difficult for anyone to access or tamper with the data without the appropriate keys and permissions.

To summarize, a blockchain is a powerful and innovative technology that has the potential to revolutionize many different industries and applications. It is already being used in a variety of ways, including as the basis for many cryptocurrencies, and it is likely to continue to evolve and develop in the coming years.

Is Cryptocurrency real money?

The short answer is yes.

To explain this we first look at :

What is money?

Money is a medium of exchange that is widely accepted in transactions for goods and services. It is a unit of account, a store of value, and a standard of deferred payment. Money allows people to trade goods and services without having to rely on bartering, which can be inefficient and inconvenient. The most common forms of money are physical currencies, such as coins and paper notes, however as it is merely a representation of value used for bartering purposes, it means that:

Money can also take the form of digital currencies, such as cryptocurrencies.

We have an entire article dedicated to What money is, and how we use it, which will provide you with some hidden insights into its roots as well as the purpose it serves in modern society.

What sets crypto apart from FIAT currencies?

Cryptocurrency is a type of digital or virtual currency that uses cryptography for security and is not backed by any central authority, such as a government or a bank. While it is a form of money, it differs from traditional fiat currencies in several important ways.

9 differences between Cryptocurrency and traditional Fiat currencies:

• Decentralized and operate on a distributed ledger called a blockchain.
• Not issued or regulated by any central authority
• Offers a high degree of anonymity.
• Usually has a limited supply in circulation
• Are more scalable and offer more transactions
• More secure than fiat transactions, provided you use best practices
• Less subject to inflation but more volatile in perceived value
• More accessible than traditional forex markets
• Not as widely adopted

With these characteristics at play, people would consider cryptocurrencies to be more akin to commodities or assets than to traditional forms of money, however, with recent changes in the industry and the collapse of large exchanges like FTX, the industry is under a lot of scrutinies. There are also different types of technologies and parties at play and not all of these promote anonymity and decentralized solutions any longer.

This has opened up a world of regulation, where cryptocurrency is no longer the wild west it was back in 2009-2020 and in many cases has started to function a lot more like a centralized Fiat currency, making it more trackable, making use verifications systems like KYC authentication which eliminates a lot of the anonymity it previously offered.

This is not to say that all hope is lost for those of us looking for a value system not subject to the whims of governments or institutions we don’t trust! By understanding the different types of tokens and technologies you will come to learn how they function and be able to find applications and communities that offer you the type of transactional exchange you are looking for.

Before that though, we need to cover the most important part of this article, the risks!

What are the risks of crypto?

Now that we have established that Crypto is a legitimate form of value exchange, it does not mean you should immediately put all your life savings into it, there are still several major risks to consider before you decide to add it to your portfolio.

The 8 biggest risks of investing in cryptocurrency:

1. Volatility: The value of cryptocurrencies is highly volatile, which means that they can fluctuate greatly in a short period of time. This can make it difficult for investors to predict the value of their investments, and it can lead to significant losses if the value of a cryptocurrency suddenly drops.
2. Lack of regulation: Cryptocurrencies are not regulated by any central authority, such as a government or a bank, which means that there is no oversight to protect investors from fraud or other financial crimes. This can make it easier for scammers to take advantage of people who are new to the world of cryptocurrency.
3. Hacking and security risks: Cryptocurrency exchanges and wallets are vulnerable to hacking and other forms of cyberattack, which can lead to the loss of funds or the theft of personal information.
4. Inflation: Some cryptocurrencies have a limited supply, which means that there is a risk of inflation if the demand for the currency increases. This can lead to a decline in the value of the currency over time.
5. Shitcoins: There are currently Tens of thousands of different coins on the market, and the lack of regulation has meant that a lot of these are based on very poor tokenomics and have little to no practical use. While this is fine if you are trading meme coins for profit, it becomes a different story if you invest your life savings into a pump-and-dump or something with no application.
6. Complexity: Cryptocurrency and blockchain technology can be complex and difficult to understand, even for experienced investors. This can make it difficult to evaluate the potential risks and rewards of investing in crypto, and it can make it harder to make informed decisions.
7. Limited adoption: Cryptocurrency is not widely accepted as a means of payment, and it is only accepted by a relatively small number of merchants and other businesses. This can make it difficult to use cryptocurrency in everyday transactions, and it can limit its usefulness as a form of money.
8. Scams and fraud: The crypto ecosystem is not immune to scams and fraud, and there are many unscrupulous actors who are looking to take advantage of unsuspecting investors. It is important to carefully research any crypto investment or opportunity before putting your money into it and to be wary of any offers that seem too good to be true.

Overall, investing in cryptocurrency carries a high degree of risk, and it is important for investors to carefully consider these risks before making any decisions.

If something seems too good to be true, it usually is.

The best and safest practice when it comes to investing in cryptocurrency is to practice self-custody for your savings and to only use exchanges and other platforms sparingly and for the specific purpose of trading and staking, limiting your exposure to risk!

What is self custody and why should I use it?

Self-custody is the practice of holding and managing your own private keys and other assets, rather than relying on a third party to do it for you. In the context of crypto, self-custody is considered the best practice because it allows you to maintain full control over your assets and ensure their security and privacy.

When you hold your own private keys, you are the only one who has access to your assets, and you are the only one who can make transactions with them. This means that you are not reliant on a third party, such as a crypto exchange or a wallet provider, to manage your assets and keep them safe. Additionally, self-custody allows you to maintain complete privacy, as you are not sharing your private keys with anyone else.

Self-custody also offers several other benefits, such as the ability to manage your own recovery process in case of a security incident, and the ability to take advantage of the unique features and capabilities of different types of wallets and storage solutions, while protecting you from the risk of third party exchange collapses or other fraudulent practices.

Overall, self-custody is considered the best practice in crypto because it allows you to maintain full control over your assets to ensure their security and privacy. It is an important part of maintaining the decentralization and autonomy of the crypto ecosystem, and it is a key aspect of responsible crypto ownership.

What are the real-world applications of crypto?

Cryptocurrencies and blockchain technology have many potential real-world applications, and they are already being used in a variety of industries and applications. Some examples of the real-world applications of crypto include:

11 Real-world sectors that use Cryptocurrency & Blockchain solutions:

1. Financial services: Cryptocurrencies and blockchain technology are being used to create new financial services and to improve existing ones. For example, cryptocurrencies are being used as a means of payment, and blockchain-based platforms are being used to facilitate peer-to-peer lending and other financial transactions.
2. Supply chain management: Blockchain technology is being used to improve supply chain transparency and efficiency. By using a distributed ledger, companies can track the movement of goods and materials through the supply chain in real time, which can help to reduce costs, improve efficiency, and reduce the risk of fraud.
3. Identity and security: Blockchain-based systems are being used to improve the security and integrity of digital identities. By using cryptographic techniques, such as public-key encryption, it is possible to create secure and tamper-resistant digital identities that can be used for a wide range of applications, such as online banking and voting.
4. Data storage and management: Blockchain technology is being used to create decentralized and secure data storage and management systems. By using a distributed ledger, it is possible to store data in a way that is secure, tamper-resistant, and decentralized, which can
5. Gaming: Cryptocurrencies and blockchain technology are being used in the gaming industry to create new types of games and to improve existing ones. For example, some games use cryptocurrencies as in-game currencies, and others use blockchain-based systems to create unique and scarce digital assets that can be traded among players.
6. Charity and social: Cryptocurrencies and blockchain technology are being used to improve the transparency and effectiveness of charitable donations and other social impact initiatives. By using a distributed ledger, it is possible to track donations and other contributions in real time, which can help to ensure that they are being used for their intended purposes.
7. Music and entertainment: Cryptocurrencies and blockchain technology are being used in the music and entertainment industries to create new business models and to improve the rights and royalties management process. For example, some artists are using blockchain-based platforms to distribute their music and to track the use of their content, which can help to ensure that they are fairly compensated for their work.
8. Energy and environmental management: Blockchain technology is being used to create decentralized and more efficient energy and environmental management systems. By using a distributed ledger, it is possible to track and manage the production, consumption, and distribution of energy in real time, which can help to reduce waste and improve the efficiency of energy systems.
9. Healthcare: Cryptocurrencies and blockchain technology are being used in the healthcare industry to improve the security and privacy of patient data. By using a distributed ledger, it is possible to store and share sensitive medical information in a way that is secure, tamper-resistant, and decentralized, which can help to reduce the risk of data breaches and other security incidents.
10. Government and public sector: Blockchain-based systems are being used to improve the transparency and efficiency of government operations and public services. For example, some governments are using blockchain-based platforms to manage and track the distribution of public benefits, such as land ownership, city planning, welfare payments, and unemployment benefits.
11. Retail and e-commerce: Cryptocurrencies and blockchain technology are being used in the retail and e-commerce industries to create new business models and to improve the customer experience. For example, some retailers are using cryptocurrencies as a means of payment, and others are using blockchain-based systems to improve supply chain transparency and to offer personalized and targeted marketing to customers.

Cryptocurrencies and blockchain technology have the potential to revolutionize many different industries and applications. They offer unique benefits, such as decentralization, security, and transparency, which are already being used to create new and improved products and services in a variety of different fields.

Different Types Of Cryptocurrency And Tokens

There are also many different types of tokens, which are digital assets that are built on top of existing blockchain platforms and there are new technologies and applications emerging on a daily basis as crypto becomes more adopted by the mainstream.

While there are thousands of different coins, each with its own flavor and utility, they can all be divided into a few practical categories based on their application and use, here are:

The 10 main types of crypto tokens:

1. Utility tokens: Utility tokens are crypto assets that are designed to be used as a means of accessing or utilizing a particular product or service. For example, a utility token might be used to access a decentralized application or to pay for storage on a decentralized storage platform.
2. Security tokens: Security tokens are crypto assets that represent a traditional financial assets, such as stocks, bonds, or real estate. These tokens are typically subject to the same regulations as traditional securities, and they are designed to provide investors with a way to invest in traditional assets using blockchain technology.
3. Payment tokens: Payment tokens are crypto assets that are designed to be used as a means of payment, similar to fiat currency. These tokens are typically designed to be easily exchangeable for goods and services, and they are often accepted by a wide range of merchants and other businesses.
4. Stablecoins: Stablecoins are crypto assets that are designed to maintain a stable value, typically by being pegged to a fiat currency or other asset. These tokens are designed to provide investors with a stable and predictable store of value, and they can be useful for managing the volatility of other crypto assets.
5. Asset-backed tokens: Asset-backed tokens are crypto assets that are backed by a physical or digital asset, such as gold, oil, or real estate. These tokens are designed to provide investors with exposure to the underlying asset, and they can be useful for diversifying a crypto portfolio.
6. Equity tokens: Equity tokens are crypto assets that represent ownership in a particular company or organization. These tokens are similar to stocks, and they provide investors with a way to invest in a company’s growth and success.
7. Governance tokens: Governance tokens are crypto assets that give the holder the right to participate in the decision-making process of a decentralized organization or platform. These tokens can be used to vote on proposals and other matters that affect the direction and operation of the organization.
8. App coins: App coins are crypto assets that are issued by a decentralized application or platform. These tokens are typically used to access the services and features
9. Reward tokens: Reward tokens are crypto assets that are used to incentivize and reward certain behaviors or actions within a decentralized network or platform. These tokens are typically distributed to participants who contribute to the network, such as by providing computing power or by contributing valuable content or data.
10. Non-fungible tokens (NFTs): Non-fungible tokens (NFTs) are unique, indivisible crypto assets that represent a particular digital or physical asset. These tokens are often used to represent unique digital collectibles, such as digital art or virtual real estate, and they are also used to represent ownership of physical assets, such as real estate or fine art.

Understanding the different types of tokens is important because it can help you to make more informed and effective investment decisions, and it can also help you to understand the potential risks and rewards of investing in crypto.

What are the top 10 cryptocurrencies based on market capitalization

Market capitalization is an indicator that measures and keeps track of the market value of a cryptocurrency and the amount of value stored between the total amount of coins/units in circulation

It is important to note that the rankings of cryptocurrencies by market capitalization can change rapidly.

The list below is accurate as of the 7th of December 2022 and is only here as an example to provide you with some insight into the major coins and players active in today’s markets.

A live list is readily available from Binance, the world’s largest crypto exchange, and can be found:

Top 10 Cryptocurrencies by market capitalization 7th Dec 2022

The market capitalization of a cryptocurrency is not necessarily a reliable indicator of its value or potential as an investment, and it is important to carefully research and evaluate any crypto investment before making a decision.

Before you start trading, be sure to read out article on investing fundamentals and check out our article on the Top crypto exchanges to make sure that you use the right tool for the right job.

For spot trading, we recommend using Crypto.com and for Perpetual or inverse futures Bybit is by far our best pick. We cover both here, in this article too!

Always do your own research before buying anything!

Crypto terminologies, technologies, and uses worth knowing!

There are many other important crypto terminologies, technologies, and uses that are worth knowing, and it is important to continue learning and staying up-to-date with the latest developments in the field. We are going to look at some relevant key concepts and terms to be familiar with as a beginner.

Here are :

7 Crypto concepts worth knowing more about

It is important to understand these concepts and terminologies because they form the foundation of blockchain technology, which has the potential to disrupt a wide range of industries and change the way we conduct business, transfer value, and share information.

By having a basic understanding of these concepts, you will be better equipped to understand and evaluate the potential impact of blockchain technology on various fields, and make informed decisions about how to incorporate it into your own work or business. Additionally, understanding these concepts will be useful if you are considering a career in the blockchain industry.

What are smart Contracts?

Smart contracts are self-executing contracts with the terms of the agreement between buyer and seller being directly written into lines of code. The code and the agreements contained therein exist across a distributed, decentralized blockchain network. Smart contracts allow for the automation of digital assets, such as money, and the fulfillment of contracts without the need for intermediaries, such as banks or legal professionals.

Smart contracts are powered by blockchain technology, which allows them to be executed automatically when certain conditions are met. This can help to reduce the risk of fraud, as the terms of the contract are enforced by the code itself, rather than relying on third parties to enforce the agreement. Additionally, smart contracts can help to reduce the cost and complexity of many types of transactions, as they can automate many of the tasks that would normally be performed by intermediaries.

Overall, smart contracts are a powerful and versatile tool that has the potential to revolutionize many industries by enabling the automation of complex transactions. They are a key component of many decentralized applications and blockchain-based platforms, and they are likely to become increasingly important in the future.

What are NFTs?

NFTs, short for non-fungible tokens, are digital assets that are unique and cannot be replicated or exchanged for other assets on a one-to-one basis. They are built on blockchain technology, and they are often used to represent ownership of digital art, collectibles, and other digital assets.

NFTs differ from other cryptocurrencies, such as Bitcoin and Ethereum, in that they are not interchangeable. Each NFT is a unique digital asset, and it has its own distinct set of characteristics, such as a unique identification number and a digital signature. This makes NFTs useful for representing ownership of digital assets that are unique and cannot be replicated, such as digital art or collectibles.

NFTs have gained popularity in recent years as a way to authenticate and verify the ownership of digital assets, and they have been used in a variety of applications, such as art, gaming, and collectibles. However, there are also some concerns about the environmental impact of NFTs, as the process of minting and trading them can use significant amounts of energy.

Overall, NFTs are a relatively new and rapidly evolving technology, and their use and potential applications are still being explored. They offer unique benefits for representing ownership of digital assets, but they also carry some risks and challenges that need to be carefully considered.

What are crypto trading bots?

Crypto trading bots are software programs that use algorithms and other automated methods to analyze the market and make trades on behalf of a user. These bots can be programmed to follow specific trading strategies, such as buying and selling based on certain technical indicators or market conditions, and they can be set to operate 24/7, allowing them to make trades even when the user is not actively monitoring the market.

Crypto trading bots can be useful for investors who want to automate their trading activities or who want to take advantage of market opportunities even when they are not able to actively monitor the market. However, they are not without risks, and it is important for users to carefully research and understand the capabilities and limitations of the trading bot that they are using. Additionally, crypto trading bots are not guaranteed to be profitable, and they can carry the same risks as any other form of investment.

Crypto trading bots can be a useful tool for investors who want to automate their trading activities, but they are not a replacement for careful research and due diligence. It is important for users to carefully consider the risks and potential rewards of using a crypto trading bot before making any decisions.

What is DeFi?

DeFi, short for decentralized finance, is a movement that aims to use blockchain technology and cryptocurrency to provide financial services that are open, transparent, and accessible to anyone with an internet connection. DeFi aims to provide an alternative to traditional financial institutions, such as banks and credit card companies, which can be slow, opaque, and difficult to access for many people

DeFi applications are built on decentralized platforms, such as Ethereum, and they often use smart contracts to automate the execution of financial transactions. By using decentralized networks and open-source software, DeFi applications can offer financial services that are faster, cheaper, and more accessible than those provided by traditional institutions.

Some examples of DeFi applications include decentralized exchanges, which allow users to trade cryptocurrencies without the need for intermediaries, lending and borrowing platforms, which allow users to lend and borrow money using blockchain technology, and stablecoins, which are cryptocurrencies that are pegged to the value of a traditional fiat currency, such as the US dollar.

Overall, DeFi is a growing movement that is changing the way that financial services are provided and accessed. It has the potential to democratize finance and make it more accessible to people around the world.

What is crypto mining?

Crypto mining is the process of using powerful computers to solve complex mathematical equations in order to earn rewards in the form of new units of a cryptocurrency. This is a way of generating new units of cryptocurrency, and it also helps to support the security and decentralization of the blockchain network.

Crypto mining involves using specialized software to solve complex mathematical problems, and the difficulty of these problems is adjusted to maintain a consistent rate of block creation on the blockchain. When a miner successfully solves a problem and creates a new block on the blockchain, they earn a reward in the form of new units of the particular cryptocurrency they are mining.

Crypto mining can be a profitable activity, but it also requires a significant amount of resources, including powerful computers and a lot of electricity. Additionally, the competition among miners can be intense, which means that it can be difficult for individuals to profit from mining unless they have access to very powerful computers and low-cost electricity.

Crypto mining is an important part of the process of maintaining and securing many blockchain networks, and it provides a way for users to earn rewards for their contribution to the network. However, it is a complex and resource-intensive activity, and it carries some risks, such as the risk of losing money on expensive hardware and electricity costs.

What is crypto staking?

Crypto staking is the process of holding funds in a cryptocurrency wallet to support the operations of a blockchain network. By staking their cryptocurrency, users can earn rewards for helping to maintain the security and decentralization of the network. This is different from mining, which involves using powerful computers to solve complex mathematical equations in order to earn rewards.

The specific mechanics of crypto staking can vary depending on the blockchain network, but the basic idea is that users who stake their funds are more likely to be chosen to validate transactions and create new blocks on the blockchain. In return for their contribution to the network, they earn rewards in the form of new units of cryptocurrency.

Crypto staking is a way for users to earn a passive income from their cryptocurrency holdings, and it can also help to support the security and decentralization of the blockchain network. However, it is important to note that staking carries some risks, such as the risk of losing access to your funds if the staking wallet is hacked or if the staking pool becomes insolvent.

As with any investment, it is important to carefully consider the potential risks and rewards before deciding whether to participate in crypto staking.

What are crypto wallets?

A cryptocurrency wallet is a digital wallet that allows you to store, send, and receive digital currencies like Bitcoin and Ethereum. Unlike a traditional wallet, a cryptocurrency wallet does not store physical currency. Instead, it stores your public and private keys, which are used to send and receive digital currency, and to track your balance.

Some cryptocurrency wallets also allow you to manage multiple cryptocurrencies within the same wallet, as well as have various types of accounts. A good crypto wallet operates just like you would expect an actual wallet or banking service would, and it offers the same various services they do. debit, credit, investing, borrowing, and others.

There are 5 types of wallet accounts to consider:

• Spot – A spot wallet is a type of cryptocurrency wallet that allows users to store and manage the digital assets they own in one place. Spot wallets are typically used for “spot” trading, which is the practice of buying and selling cryptocurrencies at their current market price, rather than trading futures contracts or other derivatives.
• Futures – A futures wallet is a type of cryptocurrency wallet that allows users to hold and manage their digital assets and futures contracts in one place. A futures contract is a type of financial instrument that allows traders to buy or sell an asset, like a cryptocurrency, at a predetermined price in the future. A futures wallet allows users to track their futures positions and manage their digital assets, as well as view their account balance and open orders.
• Margin – A margin wallet is a type of cryptocurrency wallet that allows users to access borrowed funds in order to trade cryptocurrencies on margin. Margin trading is a type of trading that involves borrowing funds from a broker or exchange to trade cryptocurrencies with leverage, which can potentially increase your profits (but also increases your risks).
• Earn/Staking – A staking wallet is a type of cryptocurrency wallet that allows users to earn rewards by participating in the proof-of-stake (PoS) consensus mechanism on a blockchain network. In proof-of-stake, users can “stake” their digital assets, such as tokens or coins, to help secure the network and validate transactions. In return, they can earn rewards in the form of new tokens or other forms of income. A staking wallet allows users to hold and manage the digital assets they are using to stake, as well as track their staking rewards and view their account balance
• Defi – A DeFi wallet is a type of cryptocurrency wallet that is specifically designed to support decentralized finance applications and services. DeFi wallets may allow users to hold and manage their digital assets, interact with decentralized finance protocols and applications, and access a wide range of financial services. Some De-fi wallets may also support additional features, such as the ability to view your transaction history or manage your wallet settings.

Distinguishing the different uses of wallets can be a little confusing at first, but as you progress with your journey as a crypto trader you will start to get a better understanding of what they do and how to use them. The wise investor knows to research and carefully consider the various financial products and services offered.

How to trade crypto

Trading Crypto is actually pretty easy to do. All you need is access to the internet, proof of identification, money to fund the account, and some basic technical knowledge on how crypto pairs and exchanges work. Don’t let this fool you though, as easy as it is to setup, successfully trading any commodity repeatedly is not an easy task.

We will cover the basics in this article, however, we also have an in-depth article on this topic that provides more details on avoiding coming pitfalls and discusses strategy and best practices in more depth, so be sure to check that out here.

The 7 steps to starting crypto trading

1. Choose a crypto exchange: The first step in trading crypto is to choose a reputable and secure crypto exchange. There are many different exchanges to choose from, and it is important to carefully compare their fees, available cryptocurrencies, and other features before deciding which one to use.
2. Create an account: Once you have chosen a crypto exchange, you will need to create an account and complete the necessary verification process. This typically involves providing some personal information, such as your name and email address, as well as proof of identity.
3. Deposit funds: Once your account is set up, you will need to deposit funds in order to start trading. This can typically be done using a bank transfer, a credit or debit card, or another payment method supported by the exchange.
4. Choose a cryptocurrency to trade: Once you have deposited funds, you will need to choose a cryptocurrency to trade. Most exchanges offer a wide range of cryptocurrencies, so you will need to research and compare the different options before deciding which one to trade.
5. Place a trade: Once you have chosen a cryptocurrency to trade, you will need to place a trade using the exchange’s trading platform. This typically involves specifying the amount of cryptocurrency that you want to buy or sell, as well as the price at which you want to execute the trade.
6. Monitor your trades: Once you have placed a trade, it is important to monitor it closely and to be prepared to adjust your position if the market moves against you. Most exchanges provide tools and features that can help you to monitor your trades and make informed decisions.
7. Read this article: These steps above were the 6 basic steps to opening and account and starting trading, but unfortunately, they do not cover risk management, stop losses, and other important information, which is what we added the 7th, our article on crypto Do’s and Don’ts that will teach you how not to lose your money while trading crypto!

Crypto Trading can be a complex and potentially risky activity, and it is important to carefully research and understand the market before making any trades. It is also important to carefully manage your risk and to be prepared for the volatility of the market.

As with anything worth doing, it’s hard until it isn’t!

The more you put into education and planning the more it will reward you in the long run!

Spot VS Futures trading

As a beginner trader, you are gonna be dealing with two main types of trading, spot where you purchase and own your tokens, and futures or margin, where you are putting down an initial deposit and then leveraging that the same way you would take a home loan to purchase a house. As I am sure you can tell the latter, derivatives trading is much riskier than spot, where you retain ownership of whichever cryptocurrency you purchase.

Be sure you check out our article on investment fundamentals to improve your knowledge and reduce your risk by learning some of the universal best practices!

What is crypto spot trading?

Spot trading is a type of investment in which an investor buys or sells an asset at the current market price. In the context of cryptocurrency, spot trading refers to the buying and selling of cryptocurrencies at their current market price on a cryptocurrency exchange. This is different from futures trading, which involves buying or selling a cryptocurrency at a predetermined price on a specified date in the future, and most importantly you own the asset!

Spot trading allows investors to take advantage of real-time price movements in the market, and it can provide opportunities for both long-term and short-term investment strategies. However, it also carries some risks, such as the risk of losing money if the price of the cryptocurrency moves in the opposite direction to the position taken by the investor.

Overall, spot trading is a popular and potentially profitable way to invest in cryptocurrency, but it is important for investors to carefully consider the potential risks and rewards before deciding whether to participate. It is also important to choose a reputable and secure cryptocurrency exchange to trade on and to carefully research and understand the market before making any trades.

What is crypto futures trading?

Futures trading is a type of investment in which two parties agree to buy or sell an asset at a specified price and date in the future. In the context of cryptocurrency, futures trading refers to the buying and selling of futures contracts on a cryptocurrency. A futures contract is a legally binding agreement to buy or sell a specific amount of cryptocurrency at a predetermined price on a specified date in the future.

Futures trading allows investors to speculate on the future price of a cryptocurrency, and it can provide several benefits, such as the ability to hedge against price fluctuations and the ability to take a long or short position on a cryptocurrency. However, it also carries some risks, such as the risk of losing money if the price of the cryptocurrency moves in the opposite direction to the position taken by the investor.

Overall, futures trading is a complex and potentially risky investment activity, and it is not suitable for everyone. It is important for investors to carefully consider the potential risks and rewards before deciding whether to participate in futures trading.

What are the biggest crypto exchanges?

The biggest crypto exchanges are online platforms that allow users to buy, sell, and trade cryptocurrencies. The size of a crypto exchange is typically measured by its trading volume, which is the total value of all transactions that take place on the exchange over a given period of time.

Some of the biggest crypto exchanges in the world include:

1. Binance: Binance is a global cryptocurrency exchange that was founded in 2017. It is headquartered in Malta, and it offers a wide range of cryptocurrencies for trading. As of December 2022, Binance had a 24-hour trading volume of over $40 billion.
2. Coinbase: Coinbase is a US-based cryptocurrency exchange that was founded in 2012. It is one of the oldest and most well-known exchanges, and it offers a user-friendly platform for buying, selling, and trading cryptocurrencies. As of December 2022, Coinbase had a 24-hour trading volume of over $25 billion.
3. Kraken: Kraken is a global cryptocurrency exchange that was founded in 2011. It is headquartered in San Francisco, and it offers a wide range of cryptocurrencies for trading, as well as margin trading and other advanced trading features. As of December 2022, Kraken had a 24-hour trading volume of over $15 billion.
4. Bitfinex: Bitfinex is a Hong Kong-based cryptocurrency exchange that was founded in 2012. It offers a range of cryptocurrencies for trading, as well as margin trading and other advanced trading features. As of December 2022, Bitfinex had a 24-hour trading volume of over $10 billion.
5. OKEx: OKEx is a global cryptocurrency exchange that was founded in 2014. It is headquartered in Malta, and it offers a wide range of cryptocurrencies for trading, as well as margin trading and other advanced trading features. As of December 2022, OKEx had a 24-hour trading volume of over $10 billion.

Overall, the size and popularity of crypto exchanges can vary greatly, and the biggest does not mean it’s the best. We have a comprehensive article that reviews the top crypto exchanges and weigh their respective pros and cons.

If however, you just want to know what we believe the best exchanges are for beginner traders are, based on security, low fees, but also user-friendliness and token coverage then head straight over to:

Where are the best places to learn more about investing?

If you have gotten through this article, you have already taken a massive step forward in becoming a successful trader! We have covered all the basics and provided a good foundation for you to further your career as a crypto trader, however, trading is one of those skills that you never stop learning, and this article alone is not enough to turn you into an overnight success.

If you are serious about improving your capabilities as a trader then be sure to check out our section dedicated to growing your wealth and be sure to check out our:

Our top 6 articles on growing your wealth through crypto

• How to trade Crypto
• How not to lose all your money on Crypto
• Investing Fundamentals
• Best Crypto exchange for your needs
• How to build a diverse portfolio
• Best stock trading platforms

These will give you a good understanding of investing and provide you with more comprehensive insights on what the be looking out for and where you should be putting your focus!

If you are looking for more in-depth articles on crypto technologies, technical indicators and trading strategies then check out:

The top 4 recommended free crypto learning sites

• Investopedia
• Coinbase learn
• Binance academy
• Crypto.com university

Mastering a skill takes time, but it is worth doing!

Good luck and don’t give up!

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