While the Bitcoin, the first crypto currency to have been established there a few years ago, has already experienced a very high increase of its value, individuals who seek productive assets in which to invest in more interested in more of these virtual currencies that invade little by little the market. It is true that this new way of regulating goods and services online has something to appeal to users as the followers of the speculation, who see it as an asset of first choice to invest for the short, medium or long term. But how to invest and trade these crypto currencies online and what you should know about this type of asset before you begin to speculate ? This is what we suggest you discover today with some explanations and practical advice.
Reminder on the concept of crypto currency : What actually are virtual currencies ?
It is called «crypto currency» the currency say cryptography, but also the very system that allows this mode of payment peer-to-peer.
In summary, we can explain the crypto currencies, saying that these are virtual currencies and digital, which have no physical support. The crypto currency so have no parts or ticket allowing them to exchange material and physical. These currencies are not usable with the methods of payment traditional banking such as bank cheque or credit card.
The crypto currencies are an alternative to currency classic. Because of their total independence of the monetary system traditional, they do not have any legal tender in any country of the world. This independence also vis-à-vis gold or other currencies because their course is not indexed on any other value. Finally, it goes without saying that the crypto-currencies are also completely detached from any organ of central management specific.
However, the crypto currencies are not considered as currency risk since they present, on the contrary, with undeniable advantages in terms of both their security and their transparency. The cryptography system used for transactions by crypto currency allows you to secure these transactions and proceeding systematically to their verification and registration in a public domain. Thus, the users of crypto currencies are the guarantee of perfect privacy and a real authenticity. The technology to encrypt these transactions is called the » blockchain «.
How can we today obtain crypto currencies ?
To own and use crypto currencies at the present time, there are several different methods. For example, you can choose to sell a good or a service online, by requesting a payment in a virtual currency, which will credit your account crypto.
Like any other currency, you can also get a crypto currency by converting another currency like the euro or the dollar. There are several online services that specialize in the conversion of foreign currencies into crypto currencies, including Bitcoins. Of course and to convert a portion of your money in crypto currency, you will first need to register on a platform specifically designed for this purpose and provide a few supporting documents such as a copy of your proof of identity or proof of residence recent.
Now that you know how to obtain crypto currencies, you are probably wondering how they will be stored or kept, since they are not matérialisables. In reality, the only way to hold crypto currencies is to possess a specific portfolio.
This portfolio is ultimately a virtual account with an address in the form of a sequence of digits and secured by a password. It is relatively easy to create this type of portfolio of crypto currency online through a platform dedicated for this purpose. It is to be noted that each type of crypto currency has its own platform and its own portfolio dedicated, but some platforms can have multiple crypto currencies.
The use of your crypto currency, once held in your virtual wallet is quite simple and goes through an intermediary such as an exchange platform (broker) or a software that you can download for free.
The service is not totally free, and most of these intermediaries typically charge commissions on the transactions made.
In the light of these few details, it seems obvious that to possess virtually of crypto currencies is not necessarily the best way to invest on these assets for the future. We will see later how to the trading online is a solution more suitable.
What are the crypto currencies traded the most interesting at the moment ?
You may already know about the crypto currency the most well-known individuals, which is the Bitcoin, given that this virtual currency has been the very first to see the light of day. But since that time, the market of crypto currencies has changed significantly. While the Bitcoin was starting to show it’s limits in terms of speed of execution of transactions, particularly, other virtual currencies using the technology blockchain have made their appearance and are possible to trade online.
To guide the best use of your investment choice, we will introduce you to here the ten crypto currencies, the most important in terms of market capitalization in 2017 :
- The Bitcoin : Created in 2009, Bitcoin is still today’s crypto currency which has the highest market capitalization with more than $ 54 billion. It is therefore still the head of the ranking.
- Ethereum is positioned at the second place of this ranking. This virtual currency created in 2015 displays a market capitalization of nearly 27 billion dollars.
- The third position in the ranking is occupied by the Ripple which was launched in 2012. This crypto currency has market capitalization of nearly $ 7 billion.
- The Bitcoin Cash, created in 2017 to compensate for the defects of the Bitcoin original, is positioned in fourth place in the standings with a capitalization of $ 5 billion.
- In fifth position we find the Litecoin was created in 2011 and with a market capitalisation of around 2.5 billion dollars.
- The NEM, launched in 2015 and offers, at present, the market capitalization of 2.4 billion is positioned sixth in this ranking.
- The seventh place is currently occupied by the Dash, which was created in 2014. Its market capitalisation currently stands at 1.4 billion dollars.
- The IOTA, recently launched in 2017 is positioned eighth in this ranking with a market capitalization of nearly 1.4 billion.
- We found then in ninth position in the crypto currency Ethereum Classic, created in 2016 with a market capitalization of 1.4 billion dollars.
- Finally, the tenth and last place in this ranking is occupied by the crypto currency NEO, launched in 2016, and that capitalizes 937 million in 2017.
Of course, all these crypto currencies are not necessarily offered by online brokers as an investment asset. You will, however, be no difficulty in speculating on the price of Bitcoin or Ethereum that are now very popular with investors worldwide.
The crypto currencies and their advantages as investment assets :
As we have just seen, the crypto currencies are becoming increasingly popular as a mode of secure payment for online transactions. But their recent success has also made them active investment of choice for individuals around the world. In the same way that other assets, such as currencies, stocks or commodities, the prices of crypto currencies is constantly evolving and it is therefore possible to speculate on the trends that will follow these courses on the market.
It must be said that the crypto currencies are assets rather attractive and have certain undeniable advantages in the face of traditional assets. Some consider them as a long-term investment more profitable than investments traditionally offered by banks or brokers. It should be remembered that the Bitcoin has taken, in the summer of 2017, the bar of $ 4 000, while it only stood at that 434.22 $ in January 2016, which is a course almost tenfold in just a year and a half. You can well imagine the potential for traders and investors who had placed their savings.
This impressive performance does not focus on the Bitcoin but also most of the other crypto currencies that remain all of the assets of particular interest to investment strategies in the long term. But the volatility of these assets also allows for strategies that are more short to be very interesting, including the use of contracts as CFDS which allow you to invest in the upward as well as downward.
Invest on crypto coins online finally returned more or less to speculate on a technological breakthrough that could change, in the long term, our use of money and of settling our transactions.
Investors are the most cautious merely banking on the Bitcoin that remains, to this day, the leader of the market of the virtual currency, and the more daring can bet on the growing success of other crypto currencies such as Ethereum, a good place to dethrone the Bitcoin in the medium term.
How to trade crypto currencies and CFD’s online ?
As we mentioned earlier, building a portfolio of crypto currencies to take advantage of the possible boom of this asset is not the ideal solution at the present time and has many disadvantages.
Fortunately, another solution is possible with CFD’s or contracts on the difference, offered by the online brokers. These contracts allow you to in fact investing on the price of the crypto currencies, the most popular without having to hold really with a management completely online. Here are the steps to take to start investing online on crypto currencies :
First, you need to open an online trading account with a broker regulated such as those that we recommend on this site. Useless to own a portfolio of crypto currency to do this since the deposit of capital will be in a first time in the currency of your choice.
We advise you then to take the time to perform your analysis carefully taking into account the technical indicators and the news of these markets and using the tools available to you by the trading platform that you have selected. You can then put in place a real strategy of investment in the crypto currency, according to the results obtained from your analysis and your predictions about the evolution of their course.
From your strategy, you will then place an order for the purchase or sale by choosing your position size and positioning of the orders closing the courses down and up that you feel is compelling. Of course, you can close manually your position by clicking a single button, either because the course of your crypto currency has reached to the higher the goal you set for yourself, or to cut your losses in the event of her course move in the opposite direction of the one on which you have wagered.
You will find on the trading platforms of these brokers numerous tools to help with the analysis to help you manage your positions, and to identify potential investment opportunities but also to limit the risk of loss too much of your capital. Regardless of the crypto currency on which you invest, your trading account will be credited in the currency of your choice.