Thanks to the fact that Bitcoin is one of the most profitable ‘products’ on the planet, many people are open to the idea of registering in its network and start trading with this cryptocurrency. After all, the latest reports state that Bitcoin’s price is around $40,000, which makes it as valuable as gold.
But, as we are about to find out, the process of trading is not that simple as there are several things that you need to take into consideration. That is exactly the topic that we wanted to discuss in this article. We’ll be learning the essentials about Bitcoin trading this year, so let’s dive into the details.
Fear of Missing Out
One of the most common challenges that novice traders face is FOMO, or also known as fear of missing out. This is a psychological state in which novice traders see that Bitcoin has been on the rise recently and think that this is the perfect time for them to invest in it and make a profit.
But, since Bitcoin is a highly volatile cryptocurrency, its price is also subject to drops in value, which is what usually happens after a certain period on the rise. So, out of fear of missing out, novice traders invest in Bitcoin only to see its value dropping in value. IN doing so, they lose money. Learning how to deal with FOMO is of great importance as it will help traders make a profit.
Where Do You Trade Bitcoins?
There are two marketplaces where you can trade Bitcoins – Bitcoin ATMs and trading sites. Trading sites are a far better option because they are easier to access and charge very low fees. Not only that, but they can help you deal with FOMO.
Let’s take Crypto Engine as an example. This trading site has an AI system that is able to analyze the market and make accurate predictions on Bitcoin’s future fluctuations. Hence, you will be provided with intel on when to sell your assets and instead of losing money, you will be able to maximize your profits.
Bitcoin Will Rise More in 2021
Next up, many people are wondering whether it is worth investing in Bitcoin in 2021. After the cryptocurrency reached a peak value of around $63,000 earlier this year, it has been on a steady decline and currently sits at around $40,000.
But, it is smart not to let the drop fool you because experts believe that Bitcoin will rise again and even peak before 2021 ends. As for the value that it is reported, analysts firmly believe that Bitcoin will reach $100,000 for the first time in its history.
The Type of Investment You Are Seeking
There are two types of investments, depending on your preferences – long-term and short-term. Long term investments are the most suitable for those that mine Bitcoins as they expect Bitcoin to rise and are very patient with the process. While you might end up waiting for Bitcoin to rise, the profit is much bigger and the chances of success are greater.
On the other hand, short-term investments are a bit riskier, but they too have advantages. These types of investments are made if you think that Bitcoin will drop in value soon and hence, you are looking to make a faster profit. So, instead of mining it, you buy it and re-sell it. That way, you end up with a fast profit on your hands. The reason why this option is riskier is that no one guarantees you that you will be able to sell your Bitcoins for a higher price than the one you bought it for.