Digital Currency Training For Beginners In Simple Language: Everything You Need To Know About Cryptocurrencies
Digital Currency Or Cryptocurrency Is A Form Of Electronic Money Based On Cryptography. The Nature Of Digital Currencies Is Decentralized, Which Means That No Institution Or Organization Controls Them.
Part 1: Familiarity with cryptocurrencies
What is a digital currency or cryptocurrencies?
Digital currency or cryptocurrency is a form of electronic money based on cryptography. The nature of digital currencies is decentralized, which means that no institution or organization controls them. The formation of digital currencies was rooted in two problems, one of which was “trusting the third party” and the other was “spending twice.” As the first digital currency, Bitcoin solved both problems, and people no longer had to trust organizations or banking institutions to do their finances.
As a result, an electronic currency was created and popularized by the people to serve the people under the name of cryptocurrencies or digital currency.
What is Bitcoin?
Bitcoin is a digital currency first developed by an unknown person named Satoshi Nakamoto. Bitcoin is a decentralized digital currency, meaning it can be sent and received from one user to another on the blockchain network without a central bank or a single administrator. It is interesting to note that Satoshi Nakamoto did not design only twenty-one million units of bitcoin at the time of designing Bitcoin so that its value as a rare asset could increase over time.
This process is designed so that the Hawing phenomenon occurs every 4 years to control inflation better. In Hawing, the miners’ reward for adding a bitcoin to the blockchain is halved, and this reduction halves the production of new bitcoins. As the supply of bitcoin decreases, so does the price over time.
What is digital currency mining?
Mining means solving complex mathematical problems with computer hardware. You get paid more when you solve more complex problems in the network of cryptocurrencies. Mining is becoming more difficult over time as mathematical equations become more complex; As a result, you need newer and more expensive hardware to make a reasonable income from mining.
What is a digital currency wallet?
One of the most important trading tools is digital currency wallets. Unlike real wallets, these wallets do not contain any physical currency, and only each wallet has a unique address. When you want to give someone digital currency or receive digital currency from someone, you have to use this address as a bank card number. There are many types of wallets, and most of them are free.
If the security of your assets is important to you, the use of hardware and paper wallets will definitely be a priority for you. One of the most popular hardware wallets is the Ledger and LedgerNano S, which supports many tokens. But if you want free access and ease of use, software and web wallets are the best option. Wallets such as Electrum, Trust Volt, Automatic Volt, and Metamsk are free software cryptocurrencies.
Tim Draper, famous Tesla and Skype investor:
“I think at some point in the future, digital currencies will prevent common currencies from being seen.”
Are digital currencies safe?
Although we have said that decentralized digital currencies are a huge advantage, decentralization is a serious threat when security problems arise. To avoid potential problems, always work with reputable exchanges, store your digital currencies in a special wallet, and never give 12 wallet recovery words to any site or exchange.
How much capital do we need to enter digital currency?
Investing in cryptocurrencies is one of the most volatile and risky things. As a result, we recommend that you spend a small portion of your assets on high-risk items by learning capital management basics and building your unique strategy.
Frequently Asked Questions
At the beginning of the road, there may be many questions such as: “Is mining with a miner still cheap?” “What is the best digital currency wallet?” “If I buy bitcoin, how much will I earn per month?” “Is it legal to buy and sell cryptocurrencies in Iran?” And “What is the minimum amount of money that can spend on digital currency?”
Part 2: How to make money from digital currencies
What are the different ways to make money from digital currencies?
There are several ways to make money from digital currencies, which we will discuss only in more practical terms:
Holding or long-term storage: Holding means buying valuable cryptocurrencies such as Bitcoin, Atrium, or other cryptocurrencies at a good price, keeping them in a safe place such as a personal wallet, and selling them at a higher price at the right time. In this case, if you can buy cryptocurrencies at a reasonable price, you can make a relatively significant profit in the long run.
Trading or trading: This means that you can multiply your capital by making regular trades and small profits. This requires knowledge, patience, and analytical skills. Of course, you can also use the experience of other major market analysts without learning technical analysis.
AirDrop, ICO, and IEO: Many digital currency companies pre-sell or pre-launch digital currency before entering the market to raise project capital. You can identify the best digital currency startups and profit by registering and investing in them.
6 principles of capital management that you should know before starting trading
At first, you may think that technical analysis knowledge is enough to profit from this market, but if you can not manage your capital and do not know how much of your capital you invest in trading, you will still be exposed to great risks.
The main goal of capital management is to reduce losses and increase profits. This means that we can reduce the losses of wrong trades as much as possible and make more profit in the right trades. But always keeping capital is the top priority in strategies.
To have proper capital management, we need to know 6 basic rules:
- Limit the loss.
- Choose a reasonable and standard trading volume.
- We must observe the profit-loss ratio.
- Do not increase the volume of trades that are at a loss.
- Before starting the transaction, determine the loss limit.
- Update the loss limit according to the conditions and time.
Now, based on the above points, we can design a good trading strategy for capital management.
Andrew Bailey, Governor of the Bank of England:
“Only buy cryptocurrencies if you are ready to lose all your money.”
Part 3: Recognizing the best cryptocurrencies for investment
How to choose the best digital currency for investment?
How you choose the best digital currency for your investment depends entirely on your experience and your trading strategy. There are generally two perspectives on trading: long-term and short-term.
If you are not yet a professional and do not know the basics of trading, we suggest that you not take risks by buying new cryptocurrencies but choose a few well-known digital currencies such as Bitcoin, Atrium, Cardano, or BainScoin for long-term investment.
Usually, the most valuable digital currencies are the top 20 currencies on the coinmarketcap.com list based on transaction value. By following the news of these currencies, you can identify suitable investment opportunities. To do this, follow reputable news agencies such as cointelegraph.com, coindesk.com, mihansignal.com, tradingview.com. These sites typically review the latest digital currency projects and give you investment opportunities and risks. Also, in some cases, members of new project development teams post useful news on Twitter, which you can be informed about by subscribing to this social network.
Analysts have stated:
The positive growth trend of digital currencies will continue this year. With the increasing use of these currencies in everyday work and various industries, the demand for digital currencies, especially Bitcoin and Atrium, which are the leaders in this field, is expected to increase significantly this year. These factors will eventually lead to a significant increase in the price of these digital assets. . To the extent that the price of bitcoin may reach one million dollars by next year!
Homeland analysts have also predicted a signal that:
“The price of bitcoin will reach one hundred thousand dollars in the next 12 months; “So you are expected to dedicate part of your portfolio to Bitcoin, Atrium, and other digital currencies.”
Should we buy Dodge Coin, Sheba, and new tokens?
These tokens are based on online jokes, and first, buying and selling them can be very lucrative. But after a while, it may cause you irreparable damage; Therefore, it is recommended that if you intend to invest in high-risk projects, be sure to allocate a small portion of your portfolio to these types of assets using the principles of capital management.
How to detect digital currency fraud projects?
If the cryptographic project has these conditions, you can identify it as a scam:
- If your account is blocked after a while and you can not log in to your account.
- The exchange website will not open for a while or announce that the website has been hacked.
- Lack of information on members of the project development team on LinkedIn or Twitter
- User reports in reputable digital currency forums.
- Money has been withdrawn from your account without notice.
- Support does not answer you.
Part 4: Start buying and selling cryptocurrencies
How do I buy Bitcoin or any other cryptocurrency?
These days, buying and selling cryptocurrencies has become very simple. All you have to do is register at a reputable Ramzarz exchange office, top up your account in Rials and then buy the digital currency you want.
How to buy the initial supply of digital currencies, and how much capital do we need?
This is a little more complicated. You must first register with a reputable foreign exchange. Then research new projects that are going to be offered initially in exchange offices. Note that many of these projects are scams. A scammer may make a worthless token and persuade you to buy it with empty promises. After offering a large amount of this token, it will offer the bulk at a higher price and pocket such a large amount of capital.
What is a digital currency exchange?
Digital currency exchange lets us buy and sell digital currencies such as Bitcoin, Atrium, and other coins.
These exchanges are generally divided into centralized and decentralized models. You can automatically purchase a digital currency in the centralized model by recharging your account and placing an order. But in decentralized mode, after sending the order, an operator manually receives your balance and gives you bitcoins.
What are the characteristics of a good exchange office?
- Always available
- Be credible and reliable
- Having a mobile and internet version
- Online and telephone support
- Easy withdrawal and payment of Rials
Which Iranian digital currency exchanges are reliable and licensed?
So far, no reputable Iranian exchange office has legally obtained a license to buy and sell digital currencies, and they mostly use advertising slogans. The fact that the price of buying and selling, strong support, and the approval of the exchange can be the evaluation factors of a reputable Iranian exchange in the eyes of a large number of users. Do not forget to use digital currency exchange as a wallet and after purchasing, be sure to transfer your account balance to a secure wallet.
What is the best digital currency exchange?
In September 1996, with the blocking of the accounts of Iranian users on the Bittrex site, millions of dollars of Iranian assets block, and since then, Iranian exchange offices have mushroomed. This has made it more difficult to select a reputable exchange with the right criteria. In the photo below, we have briefly compared some of the services of the best Iranian digital currency exchanges:
How to register and buy and sell in foreign exchange offices?
At foreign exchange offices such as Binance or Cocoin, Quinx, or Oak Exchange, you will not need authentication if the amount of your transactions is a certain amount.
What is Binance Exchange?
Binance Exchange (binance.com) is the largest digital currency exchange globally, where more than 350 digital currencies are traded daily by millions of users around the world. Creating an account on this site is free and will be done in a short time. Binance opened in 2017 but has grown very fast, surpassing its competitors. It has quickly become the largest digital currency exchange in terms of value. Binance ‘s daily trading volume averages more than $ 34 billion, which means that the number of buyers and sellers in this exchange is extremely high.
Why is Binance the best exchange in the world?
- Binance has official offices in 8 different countries.
- Supports futures and margin trading.
- It is possible to stack and invest in a variety of digital currencies.
- It is possible to use leverage or leverage up to 125 times the asset.
- In addition to its centralized version, it has launched the decentralized version (DEX).
- It has developed its official wallet called Trust Volt.
- It is one of the safest exchanges in the world.
But in some cases, due to the harsh sanctions against Iran, you have trouble working with Binance; Therefore, we recommend that you start with complete knowledge and information if you intend to buy and sell in Binance Exchange.