Cryptocurrency has evolved to the point of becoming a topical discourse, every day on the news. This ranges from its biggest upsets to new value highs. On the heels of global awareness and steady adoption of cryptocurrency being owed to it, there is still some cohort of people who remain hesitant to have a delve into the crypto market.
Yes, skepticism and hesitations are good, as they aid in being careful, but falling out completely from trading or investing in cryptocurrency is what could cost you a great mistake in the future. Volatility is the major fear dissuading people from having a foray into cryptocurrency, which is considered the biggest challenge of cryptocurrency, but this can be subdued when thorough research is conducted and you keep to date with trendy crypto-related news.
However, from the moment your digital wallet to store your cryptos is created, you need to be prompt with your decision while painstakingly picking your choice coin to invest in. As lucrative trading in cryptocurrency might be, let’s not shy away from the fact that there are great risks involved in it.
To this end, it is important to open your mind to certain trading pitfalls associated with Bitcoin, although there are thousands of coins with their respective trading risks.
1. Trading On Wrong Platform
Having a reliable platform is very crucial to forestalling the ugly event of insecurity that might put your money at the risk of loss. With the growing popularity that cryptocurrencies are enjoying today, especially Bitcoin, there is an upsurge of scam websites. Therefore, it is advisable to be very careful while mulling on the exchange platform to go for to trade.
One of the best ways to confirm the reliability of an exchange platform is through its reviews, and accessing the experience of people with the platform. Once this has been achieved, you are one foot into the crypto market. Always remember that every decision made about Bitcoin trading matters.
2. Following The Multitude
Often than not, people join the bandwagon of an asset trade and investment without assuming a decision of their own. This, in some cases, can be harmful. It should be noted that the major difference between crypto traders and newbies is the adeptness of knowing when to stop and withdraw. Most beginners are habitual of staying in the trade unnecessarily longer after it has been profitable.
3. Trading Without The Market Knowledge
According to the saying, “practice makes perfection,” but this might not be completely valid because the inability to know some intricacies of the concept would render the practice useless. Basic knowledge is one of the critical prerequisites of trading in the crypto market successfully. So as a beginner, you need to learn about some basics of Bitcoin before you start to trade.
As learning is a process, all you need is a steady knowledge about the crypto market, how it changes concerning volatility, and its trends. With adequate information, the difference between earning and losing comes to play.
4. Trading Without No Plan
Trading, just like any other job requires proper planning to achieve success. It is rather imperative to make a plan before going all out to trade Bitcoin. This is hinged on the fact that the crypto market is ever-changing, and as such, sticking to the plan made at the beginning of the trade may be impossible.
Entry and exit points are the main things to set. This translates to setting the price at which we want to buy Bitcoin and the final price at which the Bitcoin will be sold to earn profit. In essence, the lack of a plan for Bitcoin trade is considered worse than changing the plan halfway.
Another thing is allowing your emotions to get hold of you to the point of not being sharp with your decision. As fun as Bitcoin trade could be, you must always stay woke to when to stop.
5. Forgetting Password
Statistics have revealed that a large percentage of crypto traders forget their password or private key, which led them to lose their money. Although there are ways of recovering your account, would it not be better to write it down somewhere safe than going through the long process of account recovery?
Forgetting passwords is a great mistake that often leads to losing your Bitcoin. Also, creating a simple password is not advisable because your account can be vulnerable to a hack, thereby losing your money. Moreover, it is advisable to keep your password as complex as to be able to remember.
Trading in Bitcoin is a profitable venture as it tends to improve life with its distinguished features. Nonetheless, throwing some level of caution is also important because earning profit from Bitcoin can be great just as losing from it.