It is difficult to make money with crypto using only exchanges and without dedicated financial instruments and tips that can make your money fruit, therefore in this article we will analyze how increase these profits.
After the creation of the wallet and the registration on the trading platforms, the most interesting part begins: the choice of an investment strategy.
Invest your money and profit depending on how accurately you assessed the financial market situation.
A safe starting point is the use of exchange reliable. But there are other tips that can help you earn more.
There are many strategies for making money with crypto and many platforms and tools to simplify this process, saving time and other user resources.
Below are the most interesting strategies from the point of view of earnings and the solutions that automate these strategies.
Trading bot to increase crypto profits on exchanges
Direct participation in 24-hour trading is physically impossible, for this reason they are used trading bot who are able to track operations and carry out transactions independently.
A trading bot consists of a series of indicators and algorithms which allow you to identify the latest trends and can be a good choice to increase the portfolio of traders by automatically carrying out operations on behalf of users.
In the event that the user has never used a trading bot before, it is better to start with the simpler bots that have few configurable parameters, but it should be borne in mind that these bots do not generate significant profits.
The more complex bots for the exchanges will result in a good profit, but in this case traders must acquire some experience in order to configure them correctly.
A typical trading bot, also known as arbitration bot, works only on a specific site and covers several services simultaneously. Arbitrage is a trading option. You gain from the difference in exchange rates on different exchanges.
The point is that the conversion rate of digital currencies can differ depending on the platform, and this is a great way to make money. You need to monitor the situation on the selected exchanges and sell the currency where the exchange rate is higher, and buy where the rate is lower.
The important is act promptly. Just delay a little bit – and you won’t have time to make money on the difference.
That’s why bots are usually used for arbitrage. In general, trading can be a good passive income to earn up to $ 300 a month.
Classic trading on exchanges
For absolutely profitable trading, it is better to divide the funds in 4-8 different directions. It can be Bitcoin, Litecoin, fork or fiat pairs. In addition, it is better to place orders no more than 2-3% of the amount awarded for each position. In the event of unexpected dumping or depreciation, this will allow a trader to recover even in the event of an initial purchase at higher prices.
To maximize the profitability of exchange trading and open good positions, in the opinion of most crypto traders, you must start with a minimum of $ 1,000.
However, the minimum for a transaction on popular exchanges starts at $ 20-50. Generally speaking, it is more profitable to bet on an increase, as the cryptocurrency market is growing again.
At the peak: futures trading
Futures contracts allow investors to earn on Bitcoin exchange rate movements, without owning it directly. An advantage of this strategy is that investors can earn on bitcoin in countries where cryptocurrencies are prohibited (given that traders don’t buy and sell bitcoins per se, but a contract).
Trading in futures and options on bitcoin has reached very high levels. Futures and other crypto contracts rose by 32% in May compared to April this year. In monetary terms, this volume amounted to 602 billion dollars. In addition, the trading volume also increased by 36% at the Chicago Board of Trade (CME). This is the first traditional exchange that has been involved in trading futures and options on bitcoin.
The first crypto exchanges with the support of futures began to appear after 2015. In particular, in 2016, the famous stock exchange of Derib appeared in the Netherlands. The next step in the formation of the crypto derivatives market was the appearance in 2017 of bitcoin futures on the Chicago CBOE and CME exchanges. These futures were only regulated, but completely legal. Regulated futures do not give the investor the right to buy BTC directly, but allow the trader to operate on price fluctuations and protect themselves from unexpected price movements.
To date, most of the crypto derivatives market depends on crypto exchanges, among which the leaders are Huobi, OKEx and Binance. Along with the growing interest of institutional investors in cryptocurrencies, many alternative platforms begin to offer more interesting services and tools for users. For example, the European exchange Cryptology offers traders a number of unique features, such as commission-free deposits even with a credit card and the referral program for trading futures with a bonus of up to 50%.
Digital assets will increase in price as they spread, many experts believe. For example, the research department of one of the longest running crypto exchanges, Kraken, predicted that the price of bitcoin will rise to $ 350,000 in 25 years, as the younger generation will decide to invest bitcoin. An analyst on the Amsterdam Stock Exchange, Michael van de Poppe, has planned that BTC will grow to $ 150,000 by 2025-2026.
One way or another, right now the market is truly unstable and it is not worth investing money that you are not willing to lose, unless it’s a long-term investment that thousands of people are making steady money from.
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