This guide will teach you how to earn money by trading altcoins in 2021 and beyond. That is why I wrote this guide: To assist you in determining precisely how to profit from altcoin trading – without risking your entire investment.
What Are Alternative Coins?
Altcoins are essentially any cryptocurrency that is not Bitcoin. While Bitcoin is the most well-known cryptocurrency, there are still over 2,000 altcoins available – most of which are not nearly as popular as Bitcoin. Additionally, more trading options equals more potential trading profits.
Would you like to see how much money you could earn? However, this is not solely about profit! Altcoins have a slew of advantages – as you will discover below.
Six Reasons Why You Should Learn To Trade Altcoins In 2021
- You do not require a large sum of money. Even if you start with a small investment of $100, the power of compound interest allows you to earn a respectable return. This brings me to my next point.
- The returns are absurd. Gains of 100% in a single day? 1,000% in a month? Once you understand how to make money trading altcoins, these gains are possible – far exceeding the returns on most traditional investments.
- Cryptocurrency is the currency of the future. While there is a bubble in place at the moment, cryptocurrency is a highly disruptive technology. That is, cryptocurrency has the potential to alter the future of money fundamentally! Privacy, online security, anonymity, and everyday payments are just a few of how altcoins have the potential to transform our world. Cryptocurrency trading is akin to picking the next Apple, Amazon, or Tesla!
- Altcoins are thriving at the moment. Following Bitcoin’s meteoric rise, there has never been a better time to invest in cryptocurrencies than now. And I fully anticipate a boom in altcoin trading in 2021.
- It’s enjoyable. The awe-inspiring heights. The dizzying lows. Gains of 1,000 percent. Is there anything more exciting than riding the cryptocurrency wave? Without a doubt, there is a LOT of risks associated with altcoins – but that is part of the ride. Remember to invest prudently.
- Getting started is simple. Verification on Coinbase (where the majority of people purchase Bitcoin) may take a few days – but once you’re in, you’re in. You do not need experience, qualifications, or a large sum of money to participate.
How to Earn Money Investing in Altcoins
A small tip: Take your time, and do not hurriedly complete the steps listed below!
It’s critical to thoroughly research your altcoins, understand the risks, and exercise caution before making any trades.
Without further ado, here is a seven-step guide to making money trading altcoins.
- Join Coinbase.
Before trading altcoins, you must first purchase Bitcoin.
Most people purchase Bitcoin through Coinbase – it’s a convenient and quick way to do so online.
That is possible here.
- Money Transfer To An Exchange.
You can trade altcoins on exchanges – Bittrex and Binance are two of the most popular.
Exchanges are where most major altcoins are listed – they’re essentially an online marketplace for buying and selling cryptocurrency, similar to eBay for cryptocurrency!
- Make a Shortlist of Your Alternative Coins.
Now I understand what you’re thinking.
How do you know which altcoin is the best when there are thousands to choose from?
If you’re looking for some guidance, take a look at my top cryptocurrency investments for 2021.
I’d recommend investing in a long-term altcoin that you’re comfortable holding for at least six months – just in case the market conditions change.
Bear in mind that prices are so volatile that they fluctuate by a few percent from minute to minute.
As a result, I’d recommend waiting for a market correction before investing in your top pick. These dips typically occur every few days in between periods of rapid growth.
You can keep track of the latest cryptocurrency prices by visiting google.
- Keep an eye on Your Gains.
You can easily track profits/losses on exchanges such as Bittrex or Binance.
And with prices fluctuating at such a high rate, it becomes somewhat time-consuming to calculate costs constantly.
Rather than that, download the Blockfolio app.
Blockfolio automatically updates your cryptocurrency portfolio each time you open it – and it’s also relatively simple to use.
- When You Are Prepared, Sell Up.
Therefore, how do you determine when you’re ready to sell?
Establish profit targets – and when they are met, sell out.
When you’re first learning how to make money trading altcoins, it’s all too easy to become greedy.
However, do not allow this to occur!
Because prices are so volatile, if something rises, it will almost certainly fall as well. And this frequently occurs without warning!
Therefore, sell and exit as soon as your profit margins are reached.
Nota bene: when ready to sell, the majority of people convert their altcoins back to BTC.
- Withdraw your funds.
Remember: Until you cash out, you have not earned anything.
Without a doubt, those 100 percent gains are fantastic.
However, they are meaningless until the money is in your bank!
Therefore, return your balance to Coinbase – and then cash them out into your bank account.
The funds may take a few days to arrive.
Everything Is Information
When learning how to earn money trading altcoins, you can take a devious shortcut!
As you can see, I am not a trade analyst.
I have no desire to be one.
And I’m a complete failure at math!
However, you do not need to be a chart reader or a math whiz to learn how to make money trading altcoins.
All that is required is the ability to conduct research.
It is because knowledge equals profit.
Each time a new update, press release, or significant announcement occurs, you’ll notice that the prices of altcoins fluctuate quite a bit.
Therefore, join a few Facebook groups. Read some white papers on initial coin offerings—Scan Reddit for the latest cryptocurrency news.
Additionally, gather as much information as possible about your investments.
Information Is Profitable.
I recently earned approximately 90% on Bitcoin Cash the day before it was listed on Coinbase.
However, I had no intention of selling until I received information that Bitcoin Cash was about to crash! Shortly afterward, a large number of sellers dumped it in a massive panic sale.
Within 24 hours, Bitcoin Cash has fallen by 70%! Consider how critical information is now.
Three Proven Alternative Currency Trading Strategies For 2021
- Compound Interest Gains at a Slow Pace.
If you’re not up for trading high-risk, volatile altcoins, have no fear!
Rather than that, focus on gaining a small percentage point each day. While 10% per day may seem insignificant, compound interest quickly adds up.
For instance, if you earned 10% interest daily for 25 days, you would double your investment! Calculate how much you could earn with compound interest by clicking here.
And while that is entirely possible with altcoins, it does require considerable practice and technical knowledge.
Choose a cryptocurrency that you can hold for the foreseeable future and hold it.
It’s straightforward. However, it also works flawlessly!
You would have made a fortune if you had held Bitcoin since January 2017. And the situation is identical if you invest in a reputable altcoin with a bright future.
- Adhere to The Hype.
When it comes to altcoin trading, your competition is not particularly astute.
You are not in competition with Wall Street. Or banks.Or incredibly sophisticated software.
You see, when it comes to altcoins, you’re essentially trading in a market crowded with everyday people looking to make a quick buck.
Thus, while Wall Street savages Bitcoin, altcoins have yet to enter the mainstream market. They are only available through exchanges, which means you will not be competing against many professional traders. Yet!
Trading Altcoins Is Extremely Risky.
With large profits come greater responsibilities!
And when it comes to learning how to make money trading altcoins, a significant portion of the game is risk management.
Remember: You’re hedging your bets on cutting-edge technology. Nobody knows what the actual worth is.
Additionally, it would be best to exercise extreme caution when it comes to the exchanges you use. Some are superior to others – so exercise caution when selecting one.
Take precautions against hackers, safeguard your login information, and always use double-layer verification on your account.
Avoid These Rookie Trading Mistakes
Greedy. If you’re earning a profit, at the very least, withdraw some of it! When you’re making good money, it’s all too easy to succumb to greed. However, this will ultimately harm you.
Never invest more than your risk tolerance allows. Rule #1 when it comes to investing in any asset. Be responsible and avoid taking unwarranted risks.
FUD. FUD is an acronym for fear, uncertainty, and doubt. Facebook groups are notorious for this type of behavior. Decide on a course of action and stick to it – because no one knows what the future holds.
FOMO. Have you seen an altcoin that has increased 1,000% in a single day? Kindly refrain from pursuing it! Fear of missing out can transform even the most seasoned professional into a naive rookie. Rather than chasing saturated buys, wait for the next opportunity.
Pump and dump station. If you’re new to the game, a pump and dump occur when a group of traders artificially inflates the price of an altcoin. It’s essentially a scam that leaves you with low-quality coins. If you’re having trouble identifying a pump and dump, read this.
Stupid money. Hundreds of low-quality altcoins are currently flooding the market, and the situation will only worsen in 2021. Therefore, exercise caution when investing and always conduct your research.
Establish stop-loss orders. When it comes to altcoin trading, the market can quickly crash. Therefore, safeguard your gains and establish stop-loss orders – these will automatically sell your altcoins if they fall by a significant percentage.
Avoid panic. I’ve made $1,000 in my sleep trading altcoins – but I’ve also lost similar amounts! Making money trading altcoins is a risky game that can quickly suck you into emotional, rash decisions. Therefore, whatever you do, avoid panic buying/selling!