Crypto (cryptocurrency) trading is buying and selling crypto coins via an exchange platform. Some traders use Contract for Differences (CFD) to speculate on the direction of crypto prices without taking ownership of the coins. Others use a spot trading strategy that allows the buyer and seller to negotiate on the price.
Over the recent years, cryptocurrency has become a household name in Singapore and globally. More people are engaging in crypto trading and investment. Several trading platforms exist, but each person has their preferred crypto trading platform in Singapore. As a result of the incredible growth in cryptocurrency, people are looking for the top crypto exchange to partner with and invest effectively.
Some of the crypto exchange platforms include:
- Gemini Exchange
- Crypto.com
- Zipmex
- Kraken
- Thebitcoinsystem
Table of Contents
What causes fluctuations in the crypto price?
The cryptocurrency market is volatile, just like the financial markets. However, this is quite different from the typical stock market as it is faster. More volatility may be scary to beginners, but this is the secret to making money with cryptocurrency. That is why you need to master what causes the price changes.
- Integration – cryptos are becoming a mainstream medium of exchange, and the integration with diverse payment and banking systems causes price fluctuation.
- Press coverage – cryptos traders love press coverage. They will sell or buy their coins based on the news which moves the market.
- Wider events – government decisions and political events that closely relate to cryptocurrencies also make the market volatile.
Why are cryptos famous?
These digital coins are popular for disassociation from governments, anonymity means of investment, trade, cryptography, and technology.
Cryptography – many people see cryptocurrencies as the future of money and currency. Encryption and cryptography have been used in online payment methods and credit cards, translating to more privacy and security for your money.
Anonymity – is among the most significant advantage of cryptocurrency. However, you should understand that all transactions are recorded on a public ledger, so if someone is keen enough, they may trace transactions back to the sender.
How does cryptocurrency work?
The big question to beginners in the cryptocurrency journey is how are these digital coins created? These currencies are minted just like the banknotes and coins you carry around.
Step 1: Crypto Minting
Regular coins are metallic, and the paper notes are printed in factories using special machines. On the other hand, cryptocurrencies are created digitally after miners solve complex mathematical puzzles using special computer hardware. Back in the day, these coins were minted on typical desktop computers. As long as you had an internet connection, a computer, and graphic cards, then you would mine cryptocurrency.
Step 2: Crypto mining
Today, cryptos are minted via ASIC (Application-Specific Integrated Circuits). This hardware is application-specific. That means Bitcoin ASIC miners will only mine Bitcoins.
Anyone can access the mining software as you can buy an Antminer S19 Pro on Amazon. However, this hardware consumes high energy, so most Bitcoins mining activities happen in China due to low electricity costs.
Step 3: Adding to the blockchain
The final step is where the typical person receives cryptocurrency in their wallet. Upon creating an account at a crypto exchange, you will place an order to purchase Bitcoins, altcoin, or stablecoins.
An announcement is made to the Bitcoin miners’ network, and after validating this transaction, the coin is sent to your blockchain wallet.
Buying Cryptocurrency in Singapore
Are you still green in cryptocurrency? Do you wish to purchase your first Ethereum, Dogecoin, or Bitcoin? How do you go about that in Singapore?
Where to buy it?
In Singapore, you can purchase cryptocurrency in three common ways. They include DBS, online crypto exchanges, and Bitcoin ATMs. The typical way and preferred by most traders is via online crypto exchanges. Popular cryptocurrency exchanges in the country include Kraken, Binance Singapore, Crypto.com, and Gemini.
How to purchase?
You will need to choose a reliable crypto trading platform and register before buying cryptocurrency. Registration may include several verifications of documents such as passport, residential address, and face recognition. After successfully opening the account, you will fund the account.
Depending on the exchange platform you select, you can buy crypto using bank transfers, debit cards, credit card payments, or other cryptos.
Who can buy cryptocurrency?
Virtually anyone in Singapore can buy these digital coins. However, it is advisable to understand what you buy and all the relevant information. It is also great to ensure that is money you can afford to lose in case of dropping in value of the crypto.
Cryptocurrency Exchange Platforms
It is crucial to talk about these platforms. Typically, there are two exchange platforms to trade or buy and hold your cryptocurrency. These are centralized and decentralized exchange platforms. They are slightly different, and you need to know the difference as a trader.
Centralized exchanges conduct trades from cryptocurrency to fiat and vice versa. The crypto exchange also allows trades between two crypto currencies. Here a third party is present to secure and monitor the transactions. You have to verify your personal information to use this type of exchange. Some places that have stricter regulations like Canada, have a limited set of exchanges that you can trade coins on, one such exchange that is fully regulated in Canada is Netcoins.
Decentralized exchanges are similar to centralized ones, only that there is no third party. Funds are kept on the blockchain, and peer-to-peer trading can happen. Transactions here occur in a “trustless” environment. These types of exchanges are less famous and less widespread than centralized ones.
Have a crypto trading plan
Any trader must have a strategic trading plan to make good money in the crypto market since the market is quite volatile.
Even though extremely attractive, the market is challenging to trade and risky. The trading plan should have your goals, risk management tools, entering and exit trades, and the cryptos to trade.
Take Away
It would help if you learned deeply about the cryptocurrency trading world. The information would help you make informed trading decisions. Take note of this information and research extensively to have all the information you need to trade profitably and keep your money safe.
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