There are a lot of different ways to enter the crypto market. If you’re like most people, you probably first heard about cryptocurrencies from news reports or, maybe you had a buddy who was always talking about Bitcoin. For years these stories were nothing more than background noise until one day, it clicked.
Cryptocurrencies bring endless benefits to the market. But for most people, their value isn’t immediately evident. Like all great things, cryptocurrency unfolds to the user over time. The more you learn about these decentralized networks, the more you see their potential. Eventually, you end up ready to begin your crypto trading journey. Here’s some advice to help you avoid the most common pitfalls new traders experience.
It all Begins with Research
The first step to any crypto trading strategy is to become familiar with the market and some trading strategies. This process can take some time. At the very least you should learn how to read candlesticks and what projects are the top performers in the market. Cryptocurrencies such as Bitcoin, Ethereum, and Litecoin have been in operation for years and have proven to be solid projects.
You need to learn some basic trading functions as well. Most CEXs (centralized exchanges) provide you with market and limit orders. A market order is a trade that completes at the current market price. This price can go up or down during your trade. Your market order will be complete with these price fluctuations.
A limit order provides you with a little more stability in terms of your purchase price. Your limit is the price you wish to execute your trade. In a limit order scenario, your trade will only execute at this rate. Notably, limit orders are a great way to lock in profits when trading. However, there are instances where your limit order will not fill if the market is moving too quickly.
There is also a stop-loss feature available on many CEXs. This trading feature enables a user to set a price that then initiates a limit order. Traders can use stop losses to protect against sudden drops in market value and free up their time.
Bitcoin is a Safe Bet
The wide world of cryptocurrencies is growing. There are a ton of awesome projects available today. However, experts would agree that Bitcoin provides a level of stability not found in most of the market. Bitcoin has been in service for over a decade and is now legal tender in some countries.
The limited supply of Bitcoin and its die-hard community all but guarantees that this project will remain active for the foreseeable future. Additionally, as time surpasses, the scarcity continues to rise, which results in more value gains. As such, Bitcoin has an excellent store of value characteristics when viewed in a long-term strategy.
Set Up a Dummy Portfolio
One of the best things you can do before you trade any cryptocurrencies is to set up a dummy portfolio. This process is easy and only takes a few minutes to do. The first thing you need to do is to download a portfolio management app. The market is full of options such as FTX that allow you to input your portfolio and track it across multiple exchanges.
In this instance, you want to make your hypothetical portfolio. Start each token with a $1000 balance. Now, you can watch your projects over the following month or two to see how your portfolio would have developed. You can easily see what tokens saw gains and what remained stagnant or took losses. Now repeat this step only keeping the best performers from each go.
Another great way to enter the market is with a small investment. It’s recommended you begin with $10-$100. You can trade these holdings and see if you can double them. Once you can turn $10 into $20 worth of crypto consistently, you’re ready to up your ante.
Venture into DeFi
Now that you have a little experience under your belt, it’s time to enter the DeFi sector. DeFi platforms provide a variety of different passive income streams. They operate by removing all the centralized components from the financial system. Instead, regular users provide these services and the rewards are split amongst the community.
High Yield Savings Accounts
The META VAULT high yield savings accounts are one of the best options for new traders to consider. High yield accounts can provide more consistent rewards when compared to trading. Your rewards are based on your holdings. It’s a low-risk way for new traders to improve their returns. Additionally, some platforms payout account rewards in tokens can be staked as well. In the end, you create a wealth-generation loop.
Use Stablecoins to Avoid Volatility
Another trading strategy that can help you to secure a better return is the use of stablecoins. Stablecoins provide a frictionless way for traders to escape market volatility. Stablecoins serve a variety of essential roles in the market today.
Depending on the stablecoin’s type, it may be better suited for short-term or long-term escape plans. Notably, most stablecoins are fiat-backed. These projects are ideal for accounting but are subject to the same inflation as fiat currency. Here are some of the reasons why fiat-backed stablecoin might not be the best option for long-term holders.
Things to Consider Fiat-Backed Stablecoins
The main drawback of fiat-backed stablecoins is that they are subject to the same monetary policies as their underlying assets. Fiat currency can be printed at a whim with governments already amid a printing spree like no other. Reports have shown that as much as 30% of all USD fiat currency in circulation was printed since the start of the COVID-19 pandemic.
Overprinting, coupled with supply chain issues, has led to massive inflation. Inflation means higher prices for everything from food to gas. When a currency begins to lose buying power it is a real problem for savers. Currently, the inflation rate is at a 40-year high which has led many people to seek better alternatives.
One of the biggest issues with inflation is that it robs savers of their future wealth. It does this by making their holdings depreciate over time rather than appreciate. Essentially, the market gets flipped upside down with savers suffering and borrowers gaining an advantage.
Self Appreciating Options
Rather than leave your financial future in the hands of people who have no regard for it, it is wiser to research other assets. In the past, gold has proven to be a reliable store-of-value. No politician controls the gold market and they can’t print more gold and flood the market like fiat currencies. The downside of gold is that it’s not practical in today’s trillion dollar digital economy.
Gold-Backed Stablecoins Combine Aspects of Both Assets
Gold may not be well suited for the digital economy but cryptocurrencies are perfect for these networks. As such, the introduction of gold-backed stablecoins has helped to provide a viable alternative to the status quo. As such, Gold-backed stablecoins provide more SoV than fiat-backed projects. G
Gold has proven to be a great long-term store of value but isn’t necessarily readily available to the general public. It’s expensive to store and transport. Additionally, it’s no good for micro payments or large value transfers.
Gold-backed stablecoins bridge the gap between gold and today’s fast-paced economy. They enable the user to store value like gold and send value like cryptocurrencies. The combination has created some exciting opportunities for traders that were previously unavailable. Today’s gold-backed stablecoins have taken on a new meaning with some projects becoming the next-gen safehaven assets.
Safehaven Assets Have Taken Things Up A Notch
Safehaven tokens are the latest in a long line of technical innovations in the blockchain sector. These stablecoins surpass their predecessors in terms of value-storing capabilities due to their unique structure. Safehaven assets derive value from a variety of different assets which helps to keep them stable during times of intense market changes.
They differ from stablecoins in that they also integrate a variety of advanced smart contracts designed to improve their performance and protect users. The safehaven concept is still emerging in the market but there are already some exciting options that are worth considering. One such option is the META 1 Coin.
META 1 Coin – Safehaven Assets are Here to Stay
The META 1 Coin continues to see rising adoption by savers and traders due to its unique combination of features and proven success. The token differs from other stablecoins due to the use of a basket of gold-related assets as its backing. This structure enables the token to self-appreciate alongside its backing assets. As a self-appreciating asset that is decoupled from the volatility of the crypto market, META 1 serves a vital role for long-term holders and those seeking to generate wealth over time.
Smart Contracts Make A Difference
There are a couple of advanced protections put into place that make META 1 stand out amongst the growing list of stablecoins. For one, the META 1 Coin operates as a stablecoin and utility token for the larger METANOMICs DeFi ecosystem. METANOMICs combines a host of high-yield low-risk passive income features to help users secure long-term wealth. Here are some of the specifics about this unique project.
Asset Value is Crucial to Success
META 1 Coin users enjoy another layer of stability thanks to the introduction of the asset protection contract. This protocol combines an off-chain oracle and other advanced systems to monitor the META 1 Coin supply. When a trade is made, the project will ensure that the token is not traded for under its actual asset value. This maneuver helps to prevent a variety of negative scenarios including a loss of the pegged value.
The main goal of a stablecoin is to remain stable. In most cases, is a stablecoin loses its asset value and cant retain it, it’s usually the end. The crypto history books are full of stablecoins that were unable to keep their asset value over time and spiraled into oblivion. The META 1 Coin asset protection system cross-references all trades during the transactions to prevent market dumps.
Whales Can Ruin the Community
The asset protection works in tandem with anti-whale manipulation systems to create a safety net for the average token holder. Whales are traders that hold enough of a project to influence its actions and value. In the past, whales were considered a necessary evil as they could help projects to gain market cap, which is what drives prices up with traditional cryptocurrencies.
Stablecoins are decoupled from the market cap value schematic, so whales are less responsible for the value of these tokens versus their backing assets. However, despite this setup, whales can still tank the value of a project by dumping their bags. In many instances, a whale trader may hold a large amount of the stablecoin and its underlying asset. This is the most dangerous scenario, as the whale can dump both assets at the same time making it nearly impossible for the project to retain its pegged value.
Eliminate the Root Cause
META 1 eliminates this concern in two ways. First, the developers have taken the extraordinary step of banning all no humans from the ecosystem. This maneuver removes large trading firms, corporations, and governments from the economy. Since these are the groups most likely to conduct predatory whale trading maneuvers, this approach makes sense. All users must prove they are human to participate in the METANOMICs economy. Additionally, no single trader may hold over $5 million in META 1 Coins at one time.
Crypto Trading Can be Both Fun and Profitable
Trading crypto isn’t easy but it can be very rewarding if done correctly. The skills and experience you gain trading crypto can be used when trading nearly any asset. Additionally, the prospect of being able to generate profits from anywhere in the world using your PC is appealing to a large percentage of the population. As such, you can expect to see the crypto market continue to expand with new users over the coming years as the economy continues to go digital.