Are you tired of the complicated and arduous task of setting up a business to trade cryptocurrencies in Germany? With these simple steps, you can start trading cryptocurrencies like Bitcoin and Ethereum without forming a company!
Step 1: Get a wallet and an exchange account
The first step to start trading cryptocurrencies is to set up a wallet where you can store your crypto coins. The second step is getting an account with an online cryptocurrency exchange. Exchanges are similar to stock exchanges or forex exchanges but allow individuals to trade cryptocurrencies for other digital currencies or fiat money (e.g. the US dollar).
Use a hardware wallet
Another essential factor to consider is the reputation of a cryptocurrency exchange. There have been many cases of hacked accounts, so try and read some reviews before deciding where to trade cryptocurrencies.
Suppose you’re planning on storing large sums of crypto coins. In that case, it’s highly recommended that you consider using a hardware wallet instead of software wallets stored on your computer since these are less vulnerable to cyber-attacks.
Many different providers offer software wallets and exchanges, so it may be challenging to find one that perfectly suits your needs. You have plenty of options. Here is an example:
Step 2: Get Bitcoins or Ethers and transfer them to your wallet.
The next step is to buy enough crypto coins to start trading. When you decide which coins to purchase, make sure they are listed with the account you have. Bitcoins are generally considered to be the safest cryptocoin at this point due to their first-mover advantage, but there are many other alternatives – some good examples include Ether(ETH), Litecoin (LTC) and Monero (XMR).
You can purchase bitcoins or Ethers on most cryptocurrency exchanges using fiat currencies or cryptocurrencies. However, it depends on what is listed as a payment method, so please check before opening a trade! Some of the best places for buying these digital currencies are Coinbase, Kraken and Bitstamp. Note: A word of advice – ignore shady looking advertisements promising quick returns; trading cryptocurrencies is not a get-rich-quick scheme!
Step 3: Transfer your bitcoins or ethers to your exchange account
Once you’ve purchased enough crypto coins, the next step is to transfer them over to your trading account on an exchange. There are different ways of transferring balances, so please check with your wallet provider if they have any particular limits in place.
Some exchanges don’t allow fiat currencies (e.g. US dollars), so you’ll need to buy bitcoins/ethers first and then transfer these over once they show up as a balance in your account. Other exchanges allow direct transfers between bank accounts through services like SEPA or even PayPal; some exchanges offer credit card or debit card payments options (not recommended as these carry high fees and can lead to frozen accounts).
Step 4: Start trading on the exchange.
Once you’ve set up your wallet and exchange account, it’s time to start trading! The first step is to deposit your crypto coins from your wallet into an open trade – remember that cryptocurrencies are highly volatile, so keep in mind that prices may fluctuate dramatically.
When you make a buy or sell order, make sure you set up some limits if you don’t want any surprises – for example, placing a low limit of $100 per trade instead of letting the market decide (i.e. placing no limit which leads to higher risk).
Some of the most common options include:
- Buy – buy bitcoins or alternatives using fiat currency or crypto coins
- Sell – sell to make a profit in fiat currency or crypto coins
- Margin Trade – engage in trades that can result in much greater profits but with an increased risk (i.e. buying an asset and selling it as soon as the price goes up).
Step 5: Withdraw your earnings from the exchange
Trading cryptocurrencies is generally considered quite profitable. However, you need to pay attention to each trade and keep track of your bankroll at all times. Once you start earning a decent amount of bitcoins or Ethers, it’s time to withdraw them from the exchange and transfer them into your wallet again – remember that leaving money on an exchange is never a good idea!