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What you need to know about automated bitcoin trading

20th September 2020 Print

What You Need to Know About Automated Bitcoin Trading

Over the last few years, bitcoin and other cryptocurrencies have grown considerably in the number of people using, buying and trading the novel type of money. There are people who have made large sums of money through their dealings with cryptocurrencies by following the classic business strategy of buy low sell high. But with market prices  fluctuating rapidly every minute it can be tricky to constantly watch the ticker to find the best times to buy and sell your cryptocurrencies. This can be helped by the process of automated bitcoin trading, which allows the software to assist you in buying and selling at the best prices. 

This article will seek to outline a few common questions about automated bitcoin trading and give you a clear idea of whether it is right for you. 

What is bitcoin?

If you are not familiar with cryptocurrencies then there is a chance that you do not know what bitcoin is either. Or maybe you are like most people in that you have heard of it before and do not quite understand how it works. Bitcoin is a decentralized currency, which means that it is not a FIAT currency, such as the USD, Euro, and other main currencies seen in the world. Bitcoin is supported by people who uphold the network, or ‘mine’ bitcoins. 

By upholding the servers, miners are rewarded with a chance to get a bitcoin when it is released. Because bitcoin has a finite amount of coins that will ever exist, 21 million, it has a more stable value than FIAt currencies, which no longer are based on the gold standard. This makes bitcoin a popular option for many investors and venture capitalists. 

How do you trade it?

Bitcoin is traded by using cryptocurrency exchanges, similar to the stock market. This allows people interested to buy and sell cryptocurrencies in online markets with one another. There are many different cryptocurrency exchanges with different systems and fees associated with them. Be sure to explore so different options until you find the exchange that works best for you. Some popular options include Binance, Coinbase, Kraken, and many others. Also be sure that you are aware of the different types of taxes that your country or location has about capital gains made from cryptocurrencies. You do not want to be charged with tax fraud over your bitcoin adventures. 

How do you automate it?

There are a number of different ways that you can automate your bitcoin trading process. There are a number of third-party apps that are able to facilitate automated trading, similarly to what is used for the stock market. There are also options available in the interface of many cryptocurrency exchanges that will allow you to set up an auto sell or buy option when something reaches a certain price. This can help save you time, make you money, and allow you to do something else besides constantly checking your phone or computer to keep an eye on the prices.


Is it safe?

One main concern that many people rightfully have about using any third-party application with cryptocurrencies is the potential to be scammed and lose your coins. This is a reality that many people have seen, due to data breaches and hacks. However, most platforms are safe and encrypt your data. For a comprehensive review of the safety of automated bitcoin trading, experts at insidebitcoins have you covered. If you are really worried about losing your coins you always have the option to store them in a hardware wallet, a device used to store cryptocurrencies offline. This will keep your coins safe and out of harm's way. 

If you are still concerned about the safety of automated bitcoin trading then be sure to consult one of the numerous online resources to help ease your mind and understand how companies keep your data and coins safe. 

Is it profitable?

Cryptocurrencies have been responsible for making people millions of dollars over the last few years, because of their fast growth in popularity and potential for investment. To think that in the year 2010 the first real-world bitcoin transaction saw a man buy a pizza for ten thousand bitcoins is absolutely crazy. With the average price of bitcoin currently sitting around ten thousand dollars, that same amount of bitcoin is worth today nearly one hundred and 45 million dollars! It must be hard to be the first man to spend this fortune on a pizza just ten years ago. There is still lots of room for growth with bitcoin, so be sure to get in fast while the price is relatively low. In the last few years bitcoin has been worth almost 25 thousand dollars per coin, so now might be a good time to get back in the game. 

How do I start?

The first thing you need to do to start your automated bitcoin trading is to buy some bitcoin. Do some research to see where there is available to buy some cryptos online, such as some of the aforementioned exchanges. This will allow you to make a purchase and start making money as soon as possible. You might want to also consider getting a hardware wallet or some other place where you can store your bitcoin and other cryptos offline. 

Hopefully this article has been helpful and informative regarding all the different things that you need to know about automated bitcoin trading. If you have never used bitcoin before it can seem like a strange concept and you may be unsure of how it works. Use this article and any other sources online and you should be able to answer any questions on the subject that you may still have. 

You do not want to wait to get in on bitcoin until it is too late. If you had gotten in earlier than you could potentially be a millionaire right now! Make sure you take action before it is too late. You have lots of potential profit sitting untapped in front of your face. All you have to do is reach out, get online, and take part in this amazing modern phenomenon before everyone else makes all the money.

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