Due to the global spreading of the highly infectious COVID-19, most businesses have been temporarily closed while some people are fortunate enough to enjoy a work from home arrangement, but many more are forced to take leave without pay or are left without a job. You are stuck inside your own home, with so much time on your hands but so little activities that can be done. Why don’t you learn how to trade digital assets and cryptocurrency as it might be a good way to make the most out of your isolation period? Here are the five reasons why:
1. Creating An Account is Easy and Requires Zero Physical Contact
When deciding to go digital, you can forgo the hassle that requires physical contact. Opening a new trading account can be entirely done online from your laptop or smartphone. It generally takes mere minutes to an hour to set up a new account and start trading; there is no need to show up at a physical location like you would at your nearest bank branch, in full protective gear and end up dealing with tons of paper documents.
The Know-Your-Customer (KYC) process has been streamlined throughout the years. Most of the time, users only need a photo of their identification document and a portrait, upload, and Whala! Your account has been approved and you are good to go.
2. Crypto Market is Resilience
Despite the recent drop in prices along with all traditional assets caused by the fear of the COVID-19 pandemic, the cryptocurrency market as a whole has shown strength and managed to rebond firmly. Looking at the market from a technical analysis perspective, some of the big names in the crypto market such as Bitcoin remain at a pivoting point but the long term uptrend structure has not been entirely broken. Even if it does, Bitcoin has proven time after time that it will come back stronger than ever.
The COVID-19 crisis will definitely leave a scarring mark in the real business sector and aftershocks are expected to be felt throughout the remainder of 2020. Assets like gold and Bitcoin still remain a lucrative investment opportunity as they start to decouple from financial and equity markets.
3. Open 24/7 – Crypto Never Sleeps
For those who still have day jobs, the cryptocurrency market might be a good alternative since it opens 24/7 everyday throughout the year, and yes, even during Christmas! You can spend any time of the day on short-term trading without worrying the market will close by the time your daily tasks are completed. Plus, there is little to no minimum fiat deposit or buy limit, so you can start out small and increase your positions as you get better.
4. High Volatility – Risky also means Opportunity
The digital assets and cryptocurrency market is relatively young and immature, and is filled with plenty of volatility. This is great for traders looking to do short-term swing trades. Prices can go up and down in double-digit percentages within a day or even just a few hours. However, we only recommend looking at high-cap cryptocurrencies as the smaller ones might lack liquidity.
5. Whole New Asset Class and Business Model
Aside from the most popular and largest cryptocurrency in terms of market cap Bitcoin, there are many alternative coins dubbed “Altcoins” for investors to explore. Many of the large-cap altcoins offer interesting business models and high potential use cases. Ethereum, a smart contract platform, was very popular in 2017 from being a go-to platform when launching ICO projects, to what it is now as it explores the world of decentralized finance or DeFi. Ripple (XRP) which is currently being used widely among institutions and banks, enables fast and low cost cross-border money transfer and remittance services. Some of the other well-known altcoins can sometimes offer traders even higher volatility and trading opportunities.
Digital asset trading might sound tempting and lucrative, but please always keep in mind to do your own due diligence. Start small and learn as you grow, do not rush or double down on your trade or you will end up losing instead of gaining or what the crypto community usually describes as getting ‘Rekt.’
You may also want to read: New to Technical Analysis? This is What You Should Know