How to Invest in and Trade Bitcoin

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Many people want to invest in and trade Bitcoin but don’t know how to start. That’s mainly because of the unprecedented growth of this cryptocurrency. Bitcoin belongs to a class of nascent assets. And with so many exchanges, dashboards, regulatory considerations, and technologies, it’s crucial to learn about the best practices and fundamentals of investing in or trading this cryptocurrency.

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Purchasing Bitcoin via a Cryptocurrency Exchange 

When purchasing Bitcoin, you might want to exchange fiat money for this cryptocurrency. The safest and easiest way to do that is to use a crypto exchange. A cryptocurrency exchange like Immediate Edge allows users to purchase, hold, and sell cryptocurrencies.

Such platforms can charge a fee when a user executes an order or withdraws funds. Funding a crypto exchange account and buying Bitcoin can compare to using a brokerage account or a traditional exchange. Here is are the steps to follow:

  • Choose an exchange: When selecting a Bitcoin exchange, look for a licensed and reputable platform. Preferably, choose a crypto exchange within your area. Also, consider the user features like maximum and minimum deposit, fee structure, withdrawal limits, and settlement times. Not every crypto exchange allows a user to purchase Bitcoin using fiat money. Therefore, select a Bitcoin exchange that suits your needs.
  • Link your crypto exchange account with a payment option: Once you’ve created an account with a crypto exchange, link it to a payment method. And this can be a bank account or a debit card. Every Bitcoin exchange has a unique fund settlement time and fees based on how it opts to fund the account. Therefore, select a crypto exchange that suits your payment option.
  • Select your trading pair: A trading pair is two assets that you can trade in any order. For instance, you can exchange the U.S dollar for Bitcoin. In that case, USD/BTC will be your trading pair. A crypto exchange provides trading pairs. Once you’ve chosen your trading pairs, you can now place an order. Limit and market orders are the most common, and they operate almost the same in crypto exchange and a traditional brokerage. A crypto exchange can offer advanced options like perpetual swaps and margin trading.

What Follows After Buying Bitcoin

After purchasing Bitcoin, you can do whatever you please with your cryptocurrency. For instance, you can trade Bitcoin for other tokens or cryptocurrencies. You can also use the cryptocurrency on other networks in the blockchain ecosystem or platforms that accept Bitcoin. Alternatively, you can hold onto your Bitcoin for a long time as a way to store value.

But as you do that, mind about the following: 

  • Taxes: Different countries have varying crypto policies. Therefore, consider the tax implications of crypto trades in your country. For instance, the U.S treats cryptocurrencies as capital assets. That means any crypto sale or trade attracts taxes.
  • Protect your Bitcoin: When trading or investing in Bitcoin, follow safe practices like 2-factor authentication. That way, you can keep your Bitcoin and crypto exchange account safe.
  • Ignore the hype: Trading or investing in Bitcoin is not a quick way to mint money online. Several factors influence cryptocurrency prices. Therefore, research the cryptocurrency that you want to purchase to make an economical and informed decision.
  • Monitor the crypto market: Always monitor Bitcoin price changes to decide when to purchase or sell your crypto assets. Although you can automatically execute your trade using limit orders based on your pre-set parameters, you need price alerts to stay updated on significant market changes passively. That way, you can capitalize on price fluctuations at any time.

Trading and investing in Bitcoin requires time to research this cryptocurrency and understand how it works. Follow these tips to trade or invest in this cryptocurrency safely and wisely.

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How to Invest in and Trade Bitcoin
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Do you want to invest in or trade Bitcoin? If yes, here are things to know when buying, selling or trading this cryptocurrency via an exchange. 
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