We are living in a word full of uncertainties and at times, it can be extremely challenging and full of hassles. One of the things that people are constantly worried about is money. For many years, banks have been the dictators of funds. They determine when and where we can and cannot send money and charge a high fee for it. This means we are not financially free as there are a lot of restrictions.
Fortunately, with the inception of cryptocurrencies, we are becoming financially free. Wondering whether crypto trading is paving ways for financial freedom?
In this post, we will talk about how crypto is making a way for financial freedom.
What is Financial Freedom?
Before we can talk about crypto trading, you need to know what financial freedom is. Financial freedom can mean different things to different people. But mostly, it means living without having to worry about money.
Well, we all want to live in a world where we don’t have to worry about money. This might be a dream for many people since few people are aware of all the possibilities. Or some people don’t want to take the leap.
Trading assets is a well-known and traditional way of making profits. Recently, the learning curve and price have made the entrance extremely hard for people. With the help of advanced technology, it is changing.
Thanks to technology, a new trader or an inexperienced trader can make profits without any difficulty. Yet, many people find it hard to follow. So, if you are first to the new technology, it will pay off greatly in the future.
Adoption of Cryptocurrency
In 2017, it was reported that nearly 1.7 billion people in the world do not have any link to a financial institution or have a bank account. With the introduction of new technologies like blockchain and cryptocurrency, there is a hope that it will bring potential benefits of banking to such people.
These technologies have changed the way we communicate and transfer information. There is a debate going on between central banks regarding cryptocurrencies. A lot of confusion surrounds whether it should be considered as a commodity, asset, or a currency.
Amidst this confusion, Bitcoin showed how easy it is to enjoy financial inclusion. All people need is an internet connection and a device. Cryptocurrencies are gaining popularity for many reasons; ease of using and trading it internationally being amongst it. A wonderful thing is that you will not have to incur a lot of costs.
Wondering if it is not something new? Well, yes, MasterCard and Visa have been offering cashless transactions for a long time. But their fee structure burns a hole in pockets of small businesses. One of the benefits of cryptocurrency is that there are no middlemen. This makes it a peer to peer and decentralized approach.
We have a real-life example of how cryptocurrency has better financial inclusion for everyone. Venezuela has been influencing hyperinflation since 2016 and was on the brink of ruin. During the period 2016 to 2019, the inflation rate increased by 53,789,500%.
After the depreciation of the value, the citizens started using Bitcoin as a substitute. Since then, the weekly trading volumes have increased. This enabled them to take control of their money without any middlemen i.e. third parties or banks. People even started receiving their salaries in digital currencies.
When it comes to cryptocurrency, you need to keep in mind three words: value, accessibility, and stability. It offers more control to the people over their assets. This means you can keep them away from governments and any kind of financial crisis.
Moreover, it is a great alternative to the hyperinflation of currencies. Having crypto assets, you can indulge in a commission-free trade that will allow the people to keep most of their assets.
How Cryptocurrency Gives You Freedom
Cryptocurrency wallets focus on keeping your currency secure and safe. There are different security measures used for doing so such as deep-freeze storage, online, and offline storage. This offers a wide range of benefits including:
- You can send and receive cryptocurrency effortlessly, from anywhere in the world.
- Get to access your money at any time of the day. Holidays or bank closures will not impact it.
- Offers increased security.
- There is no risk of fraud and human error.
- You have complete control over money.
- It will keep your personal information safe and secure.
- People who don’t have access to modern banking can have access to it as well.
- If you want to truly enjoy financial freedom, cryptocurrency is the
How Crypto Trading Is Making Financial Freedom Possible?
Everyone knows that during an instability, either cultural or political, the conventional banking system does not address the requirements of the people. Luckily, both cryptocurrencies and blockchain systems, are capable of surviving and work efficiently in troubling times.
These will not only help in making everyday payments, but it can also be used for generating more wealth. Let’s take a look at how you can achieve financial freedom using crypto trading.
Just like normal currency, cryptocurrency is also traded on the exchange. The working of this exchange is similar to that of the global equity market. For those who have a knack for fundamental analysis or technical analysis, this is a highly profitable approach.
Just keep in mind that day trading is quite risky since some tokens can experience high volatility frequently.
Buying and Holding
It was more than 10 years ago when Bitcoin was launched and since its inception, the value of several cryptocurrencies has appreciated. If instability is a major concern in the short term, the prices increase to meet the high demand. This is the reason why cryptocurrencies have a high market capitalization. There was a time when Bitcoin was trading between $1 to $2. But now, it is trading around $10,000 mark.
Many people started keeping cryptocurrency in their wallets. Just like bank accounts, for creating a wallet you need to get approved by a third party. You will need an internet connection and a device like a smartphone or a computer, to have access to the wallet.
A better strategy is to buy a small amount of the currencies and hold it for some time.
Another way to achieve financial freedom is through mining. For those who don’t know, mining can be defined as the process of using computational power for verifying transactions. Also, it is useful for generating new cryptocurrency units.
Currencies like Bitcoin are not mineable through consumer-grade hardware. However, currencies like Zcash or Ethereum can be mined. Without a doubt, mining can be very profitable, but it requires some kind of upfront investment, usually in hardware form.
The best thing about mining is that it is capable of generating revenue, without your attention.
We all are aware of the marketing practice that when a new project is started, they offer a complimentary gift to their users. The same is the case in the cryptocurrency industry. Whenever a new blockchain project is started, it gives away free tokens. This act of giving free tokens is known as an airdrop.
The main purpose is that more people will try the new product or service if they don’t have to spend money.
The tokens you get have value in the real world. So, in this way, you can trade them for another cryptocurrency.
Initial Coin Offerings
We all know blockchain technology and cryptocurrency is still in its infancy. Many startups and enterprising developers are working tirelessly to improve the application of the cryptocurrency and blockchain.
Since it is the currency of the future, it better to invest in such a project at an early stage. You can participate in Initial Coin Offering (ICO). This is open for public investment, unlike stock exchange listing.
There are many cryptocurrencies that started out as an ICO. For instance, Ethereum started as an ICO and offered great returns in a few years.
Before you can invest in an ICO, you must understand the project. This will help in avoiding any scam.
A safe and better substitute to day trading is price prediction. There are apps that allow you to predict the prices of different cryptocurrencies like Alluva. The more accurate your prediction is about the value of the currency, the more you get tokens. Such tokens can be traded for other currencies or can be redeemed at the partner’s website.
A good thing about this approach is that there is no need for an upfront investment.
Some cryptocurrencies utilize staking for verification of transactions. A great thing about this approach is that it enables holders to get an interest in the tokens as a reward. Basically, in staking, you will have to store some tokens in a live wallet. The more tokens you have, the higher the reward will be. This is considered better than mining because you will not have to buy hardware, which costs you an arm and a leg.
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Tips for Crypto Trading
Because of a lack of knowledge, crypto trading is a challenging and daunting task. Traders have to rethink their plan when it comes to the trading of crypto. This is because cryptocurrency is highly unstable.
To make it easy for you to trade crypto, take a look at the following tips.
It’s Better to Invest in Different Coins
One of the biggest made by many traders is investing in the same currency or coins. Just like Warren Buffet said, “Don’t put all your eggs in one basket”, you should not just invest in one type of coin. It is better to invest in different coins to avoid high risk.
Know the Risk Before Investing
We all know there is an elevated risk with cryptocurrency, even though it is well-versed. It is a good practice to know the stakes before investing in a coin. We advise calculating the percentage of the risk and its adverse impact on capital. You must go through only if the risk is well-calculated and you can bear it.
Don’t Let Fear or Greed Take Over Your Decision
It is common for emotional factors to take over our better judgment. Greed and fear are two emotional factors that will negatively impact your decision-making skills. That is why these two factors should be eliminated.
When trading crypto, these factors can lead to making bad decisions. So, you should calculate the risk and then make a decision.
Get All the Information
Before making an investment or trading, it is better to gather all related information regarding the Bitcoin trading mechanism. Also, you must have comprehensive knowledge about the instability of the cryptocurrencies.
After you have all the information, it will be easy to decide. Bitcoin trading is different, so information is crucial for successful trading.
Choosing a Cryptocurrency Trading Platform
Another tip is for choosing a reliable platform for trading crypto. Since there is not a lot of information available and many fraudulent companies are operating, it is easy to make mistakes and even become a victim of such companies.
This is why it is recommended to find a reliable trading platform. You must check the registration of the companies and make sure they are licensed by the government. Besides this, we recommend checking their legitimacy offers, and services.
Trade With A Plan
“Failing to plan is planning to fail”. This popular saying can be applied to the crypto trading market as well. It means you should invest in coins without having a precise and accurate plan if you want to have good results.
Therefore, we hope you have a better understanding of how you can achieve financial freedom with crypto trading. However, this list is a great starting point for someone new to this technology. These ways will help you capitalize on your investment.
Without a doubt, blockchain and cryptocurrencies will continue to grow and expand their applications. There is, still, a lot of uncertainty about how these technologies will bring a change in the operations of businesses and industries.