A few years back, Erik Fin man, a 12-year-old from Idaho had received a $1,000 gift from his grandmother on his birthday. As an astute investor, and a fearless entrepreneur as he was, he invested that money into then sparsely known digital currency – BITCOIN – valued at $12. Unbeknownst to him, by buying into cryptocurrency he had participated in a financial revolution that continues even today.
Two years later he sold it at a profit of whooping $100,000, and if he had held onto it – it would have been at least a Million-dollar investment. This has been the power of cryptocurrency or virtual currency that has made Millionaires out of even twelve-year-olds.
What are CryptoCurrencies?
Wikipedia defines cryptocurrency as a digital asset designed to work as a medium of exchange using cryptography to secure the transactions, to control the creation of additional units, and to verify the transfer of assets. There are some interesting terms in this definition. For example, cryptocurrency is a digital asset as against a paper asset or an immovable real estate asset. As it is a digital asset – transferred through network – it requires security measures, cryptography to secure the transactions. An interesting aspect of cryptocurrency is the fact that it can also be ‘Created, ‘or ‘Mined,’ through a bank of powerful computers, and complex algorithms. The mining for newly designed cryptocurrency is called Initial Coin Offering (NYSE:ICO), and they are akin to Initial Public Offerings (IPOS) in equity markets.
The underlying philosophy behind cryptocurrency is a desire to build a digital cash system that is universal, safe, and easily transferable without any Government regulations (As of now – that might change). The cryptocurrency exchange is universal, does not recognize national boundaries, and is safe. They are safe primarily due to its blockchain structure, where a particular coin information is stored distributively among various computers, and no one person or entity other than you have access to it. Just from the historical perspective, that was precisely the vision of Satoshi – the inventor of the first cryptocurrency blockchain – bitcoin – that he wanted to create “A peer to peer electronic cash system without a central entity.
Why Trade Cryptocurrencies?
At PTI, we are excited about the potential that investing in cryptocurrencies provide to our clients. The market for Cryptocurrencies is fast-paced, exciting and very profitable if managed knowledgeably, and prudently. As some experts suggest, trading in cryptocurrencies is like the old gold rush or the old railroad days when each day would present some unimaginable opportunity to make potential returns of 100% or more. The colossal growth by over $200 billion in market cap in 8 months is astounding, and a testament to the fact that the crypto market is here to stay, grow, and offer even more opportunities for some phenomenal returns. Digital transactions are getting acceptance the world over, where now the behemoth countries like India are getting into more and more digital transactions.
How to Trade CryptoCurrencies:
There are two ways an investor can trade Cryptocurrencies.
Option 1: Trade currencies like BITCOIN and Ethereum through an already established brokerage against the Dollar, Sterling or Euro. This method, although lucrative, is still fraught with massive spreads from brokerages and volatility, unless you’re a seasoned trader it can be difficult to navigate.
Option 2: The more popular and stable method, is through buying and holding Cryptocurrencies using Exchanges and Wallets.
Buying and owning a Crypto is really exciting and provides a great opportunity to make consistent and phenomenal profits. In order to give you an example on type of advice that we provide, please review the following. Bit Shares is a Decentralized Exchange and Fintech Platform. Currently, Cryptocurrencies like Bitcoin are traded on large exchanges, which follow the traditional logic of centralization. On the other hand, Bit Shares aims to change and disrupt the current thinking and introduce a decentralized platform for trading in cryptocurrencies. In particular, it has introduced ALTCOIN that seems to make history (Please see the following chart) in terms of growth and investment opportunities. As the following chart shows, the coin has already increased in value by 40% in last eight weeks, though it still offers a perfect Break out, Pull back, and Continuation (BPC) opportunity before it moves up above 0.1. Thus, based on our analysis we see an entry at 0.095, with the price moving to 0.12 – a major resistance with a mid-long term holding period.
Perfect Fundamentals + Perfect Technical Analysis + Perfect Logic + Perfect Risk Management = Perfect Trade
Hopefully, you have enjoyed the article and have gained great knowledge about trading and how to trade.
Wishing you all the best.
The information you’ll find in this article is for educational purpose only. We make no promise or guarantee of income or earnings. Use your best judgement and perform due diligence before using the information in this article. Your success is still up to you. Nothing in this article is intended to be professional, legal, financial and/or accounting advice. Always seek competent advice from professionals in these matters. If you break the city or other local laws, we will not be held liable for any damages you incur.
This article was originally published on Platinum Trading Institute