Step 6 – Create a wallet to store your cryptocurrency.
The purchased cryptocurrency should not be stored on the exchange, it should be kept in a safe place - in an electronic wallet. There are two main types of wallets: "hot" (online wallets) and "cold" (hardware wallets).
"Hot" wallets are those located on services connected to the Internet, such as an exchange or a mobile application. They are convenient for active trading, but at the same time have a high probability of being hacked.
"Hot" wallets are best used when you need to buy something or when there is active trading on the exchange. Or if we leave a certain amount in the wallet for strategic use: purchase, resale, etc.
Cold hardware wallets are devices for storing cryptocurrency that are not connected to the Internet. They are more secure and suitable for long-term storage.
The most commonly used hardware crypto wallets are:
Ledger;
Safe;
For small amounts of cryptocurrency, it is more convenient to use "hot" wallets. If you are planning serious investments, long storage periods, large amounts, then this is only "cold" storage.$BTC
Step 7 – Understanding Risk and Diversification.
As we have already said, the cryptocurrency market is highly volatile, and prices can change significantly in a short period of time. Therefore, it is important not to invest more than you are willing to lose.
The key point is also diversification. You should not invest all your funds in one cryptocurrency, in one direction, or store them on one specific exchange.
It is wise to divide your investments between different assets, and wisely keep funds in several wallets. This helps reduce risks. Step 8 is a constant focus on news and trends.
The cryptocurrency market is very sensitive to news, so it is important to follow the latest information. First of all, these are changes at the legislative level, innovations in the regulation of cryptocurrencies, etc. This market is strongly influenced by global news, global events, statements by large companies or investors about supporting or rejecting cryptocurrency.
Also, if you want to trade, you must learn how to do technical analysis, analyze charts and the market. This is a separate, rather complex area. $BNB
Step 9 - Learn to analyze charts and the market in general.
Technical analysis does not always work and charts can be deceiving.
It is necessary to understand that any market is manipulative, and charts are pictures that market makers draw for us. These are people who support the pricing policy and financial model of any project together with the exchanges where they are present.
Therefore, a beginner needs to understand technical analysis and charts in order to understand how promising an asset is and whether it has a future. In order to acquire an asset for a long-term or short-term goal and earn money, you need to be able to look not only at the chart.
Step 10 – analyze the news.
Usually any news is “pulled” to one or another connection with the rate of #Bitcoin , #Ethereum a or any other well-known cryptocurrency.
It is necessary to learn how to analyze them, to see who benefits from the information and how to use it as a tool, in addition to technical analysis, chart analysis, on-chain analytics, etc.$TRB
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