Cryptocurrencies How to make huge profits

Cryptocurrencies .. How to make huge profits?

Individual and international investment in digital currencies is increasing, especially in light of the financial fluctuations in the current systems. However, profit operations remain governed by precise strategies, so let's get acquainted with them.

What are digital currencies?

Digital currencies are electronic money that lacks tangible form, calculated and transferred through digital encryption using electronic devices or electronic wallets. These wallets make it difficult to counterfeit any digital currency.

Transactions made using these currencies are kept through decentralized networks called "Blockchain". These networks form a common database between a network of websites and electronic servers and create a path that can be followed to reduce cyber attacks.

Cryptocurrency trading history
Digital currencies have been in existence since the invention of the Internet, but at first it was difficult for people to accept them. This feeling has gradually faded with the development and spread of the Internet, and the willingness of people to invest in digital money has increased. PayPal is one of the first successful companies that worked on the idea of easy-to-use digital financial transactions.

With the increasing popularity of currencies, countries began to work on regulating them, in 2015 New York made headlines for being the first state in the United States to regulate these virtual currency companies. Many countries also have plans to launch their own cryptocurrencies.

How many digital currencies?
All statistics confirm that the number of all digital currencies is more than 5000 digital currencies. According to Statista data, there are currently more than 9,900 coins, and CoinMarketCap data for January 2021 shows that the total number of cryptocurrencies is 7,812, with a total market capitalization of $324,716 billion.

A large number of cryptocurrencies in circulation are also "fork" (a fork is a case in which a blockchain splits into two separate chains). For example, Bitcoin Cash and Bitcoin SV split from Bitcoin. Also, Ethereum split from Ethereum Classic.

Cryptocurrency market
The top five cryptocurrencies, which include Bitcoin, Ethereum, Binance, Tether and US Dollar Coin, represent over $1.18 trillion in market capitalization. For example, Bitcoin dominated the market on January 27, 2022 with a share of 41.6%.

The market capitalization of coins depends on the performance of major digital assets such as Bitcoin and Ethereum. The price of each currency can often fall sharply in the times after its release.
Types of digital currencies
In general, there are three different types of digital currencies:
Cryptocurrencies
They are digital currencies that use cryptography to secure and verify transactions. Cryptography is used to manage and control the creation of these currencies. Bitcoin and Ethereum are examples of cryptocurrencies.
Virtual currencies
Virtual currencies are a type of unregulated digital currency, controlled either by their developers or by creating a protocol that defines how they are calculated. For example, a gaming network token whose economies are determined and controlled by developers.
Central bank digital currencies
Central bank digital currencies (CBDCs) are regulated digital currencies issued by the central bank of a country. It can be a supplement or alternative to traditional paper currency. England, Sweden and Uruguay are among the countries considering plans to launch a digital version of their original fiat currencies.

Cryptocurrency properties
open source

Cryptocurrency is usually open source, which means that developers can create free programming interfaces and therefore anyone can use and join these interfaces.

encryption

It is impossible to counterfeit a digital currency or send the same currency to multiple people. These currencies are also subject to encryption, where you can view and send or receive them with an encrypted code.

Anonymity

Cryptocurrencies are held in an encrypted wallet based on an encrypted address. This address is controlled by the owners of the coins, but it is not linked to their identity and therefore they can use a pseudonym. For example, Bitcoin or Ethereum is sent to and from addresses, apart from people's names.

Best cryptocurrency

1-Bitcoin

Bitcoin (BTC) was created in 2009 by an unknown person under the pseudonym Satoshi Nakamoto. This currency runs on the blockchain, where it is kept securely. It also has a market value of more than $730 billion. Its price increased from approximately $500 in May 2016 to more than $38,000 on February 1, 2022. This represents a growth rate of about 7600%.

One of the reasons why Bitcoin is among the best digital currencies is that it is the oldest of them, and it has the largest number of developers and investors who support it for further growth. For example, Bloomberg, Microsoft, Overstock.com, Expedia, have started accepting payments in Bitcoin.

Bitcoin faces huge challenges in scaling due to its slow transactions, with a single transaction taking about 10 minutes. Transaction fees are also high, making them less feasible.

The process of creating a new Bitcoin by solving a mathematical puzzle called “mining” is now only possible using very expensive, very powerful and consuming huge amounts of electricity.

2- Ethereum

Created in 2015 by Vitalik Buterin, Ethereum has a market value of more than $327 billion. Ethereum features decentralized applications and smart contracts that occur automatically when conditions are met, along with Blockchain technology. In addition to the speed of making transactions that do not exceed a few seconds.

The currency witnessed tremendous growth from April 2016 to February 2022, as its price increased from about $11 to more than $2,700, an increase of nearly 2500%.

Ethereum has serious scalability issues, as it still uses an outdated transaction verification mechanism that leads to network congestion. This is the same mechanism that Bitcoin uses, so it requires a lot of electricity like it, but its developers are trying very hard to find a solution to this problem. Ethereum also supports only one markup language, which makes it a barrier to entry for developers. In addition, it faces stiff competition from coins such as NEO and Cardano which offer similar platforms but with improved technology.

3-Tether USDT

Tether is worth over $78 billion in the cryptocurrency market. It is a stable currency, because it is backed by fiat currencies such as the US dollar and the euro and virtually holds a value equal to one of these two denominations. In theory, this means that the value of Tether is supposed to be more stable than other types of currencies. Therefore, it is preferred by investors who fear the extreme volatility of coins.

4-Binance (BNB)

With a market capitalization of over $63 billion, Binance is one of the largest cryptocurrency exchanges. Since its launch in 2017, Binance Coin has expanded simply for the ease of trades on its exchange. You can use it to trade and pay fees or exchange it for other forms of cryptocurrency, such as Ethereum and Bitcoin.

Binance launched at a price equal to $0.10 in 2017, rising to about $377 on February 1, 2022. This increase represents approximately 377,000%.

5- US dollar coin (USDC)

The US dollar is worth more than 50 billion dollars. It is considered a stable currency because it is backed by the US dollar. It is powered by Ethereum and you can use it to complete global transactions.

6 - Cardano (ADA)

Cardano has a market capitalization of over $35 billion. It is best known for solving the three challenges faced by other cryptocurrencies, as it speeds up transaction time, reduces energy use, and reduces environmental impact.

The Cardano team launched this project with the aim of launching a smart contracts platform that is advanced enough to allow more advanced features that compete with the protocols available in the field. According to the statements of those in charge of the project, their goal is to launch the first blockchain platform based on scientific foundations.

The ADA token from Cardano has achieved relatively modest growth compared to other major coins. In 2017, its price was $0.02, then increased by 5.1505 on February 1, 2022, to become $1.05.

7- Solana (SOL)

Solana coin is an open source "Blockchain", with a market capitalization of more than $33.5 billion. This platform is designed to host decentralized and scalable applications. The currency is characterized by the speed of transactions with low fees compared to the currency of Ethereum.

Initial work on the project began in 2017. However, it was officially launched on the cryptocurrency market in March 2020 by Anatoly Yakovenko of the Solana Foundation at a price equivalent to $0.77. However, by February 1, 2022, it scored about $100. This represents an increase of approximately 13,000%.

8- Ripple (XRP)

The market capitalization of Ripple is over $29 billion. It can be used on its established Ripple network, in order to facilitate exchanges for different types of currencies. Including other major crypto and fiat currencies.

At the beginning of 2017, its price was $0.006, reaching $0.62 on February 1, 2022, which is equivalent to an increase of more than 1,000%.

9- TERRA LUNA

With a market value of over $21 billion, Terra Luna is a blockchain platform that enables payments using algorithmic stable coins through native cryptocurrency (LUNA). The coin aims to combine the reliability of stablecoins with the advantages of blockchain technology.

The price of the Terra stablecoins is held constant by the same protocol which includes an automated market maker that allows trading of the Luna and Tera stablecoins in both directions (supply and demand). Coming back to Luna, it is the original coin of the Terra platform that stabilizes the price of coins. It also plays an important role in maintaining the protocol, as it is the necessary coin for storage.

As reliance on Terra platforms increased, so did Luna's value. On December 3, 2021, its price was $0.64 and then increased by almost 8000% to reach $51.39 a year later.

10- Polkadot (DOT)

Polkadot records more than $19 billion in the cryptocurrency market. Polkadot aims to integrate coins of the same name by creating a cryptographic network that links different block chains so that they can work together. This integration has led to impressive growth, as its price has increased since its launch date from $2.93 in December 2020 to $19.49 on February 1, 2022. This is an estimated increase of 565%.

Pros of cryptocurrency
Cryptocurrencies are characterized by their fast transactions due to the presence of investors within the same network.
Currency transfers are done without intermediaries.
Electronic transactions based on digital currency require record keeping, which enhances transparency.
The circulation of this type of currency does not require physical manufacturing and does not require many requirements, such as the establishment of physical manufacturing facilities. These coins are also immune to physical defects or contamination found in physical currency.
This type of currency is not governed by the state or central banks. Therefore, it would be outside government manipulation.

Digital transaction costs are cheaper than traditional transactions, as they allow direct interactions within the network. For example, a customer can pay a particular store owner directly without the need for intermediaries as long as they are in the same network.

Disadvantages of cryptocurrency
1- These currencies do not solve all storage and infrastructure problems, although they do not require physical wallets, but they have special requirements such as Internet connection.

2- Hackers can steal fiat currency from internet wallets or change their protocols, making them unusable.

3- Digital currencies can experience sharp fluctuations in prices. For example, the decentralized nature of cryptocurrencies has led to an abundance of currencies with little capitalization and whose prices are subject to sudden changes based on the whims of investors.
How do I invest in digital currencies?
The world knows only a few successful and wealthy cryptocurrency brokers because of the density of information that you have to absorb and use when choosing a profitable strategy.

1- In the cryptocurrency market, you are taught to buy at a low price and sell at a high price. Therefore, you need to monitor the market and its price movements. For example, currencies that are going in an upward trend will eventually increase in price, which is when you can sell to make a profit.

2- You should monitor Bitcoin because it is the basis of cryptocurrencies. Hence, their prices will often influence other currencies.

3- You have to follow all the political and economic news, as it has a great impact on the market. For example, when Iran responded to US aggression and bombed US military bases in Iraq, the price of Bitcoin rose from $8,000 to $8,300. This situation also led to the emergence of an upward trend for the entire market.

4- If you do not calculate the potential profits you will make, you will probably sell your crypto asset at a lower price. Which will lead to your loss.

5- Choose a reliable crypto exchange, because it will provide you with fast deals, high security and easy withdrawals. Moreover, your personal data will not be hacked.

Cryptocurrency trading strategies
HODL

Traders say that the HODL strategy is the easiest scheme for beginners to invest in cryptocurrency and it means holding the asset for the long term in the belief that the price will rise in the future. It also allows you to invest in popular coins or tokens to reduce your risk.

In this strategy you should avoid checking prices regularly because you may sell your assets too soon. But it is a risky strategy, as the price can drop suddenly even if it looks like an upward trend, and instead of taking profits you will stumble on a loss.
Cryptocurrency trading strategy
Statistical review is one of the most popular strategies among traders and it works by buying coins on an exchange, then selling them on another platform and then for fiat currency.

The logic of this strategy is to take advantage of the delayed price correction across these exchanges. The only difficulty you can face is in the fees, which can be higher than the potential currency income. Therefore, try to use platforms with low commission in order to make a profit.

No matter what strategy you may follow when investing in cryptocurrencies, you must remain wary of losing because the market can be very volatile at times.