Cryptocurrency, the decentralized, blockchain-based, digital currency is quintessential modern technology. It has revolutionized the concept of what currency can be and may even be the future of money. Tech-savvy traders have rushed to markets and exchanges around the world to get in on the crypto action.
When trading this technologically advanced currency, it is no surprise that traders are employing other technologies to help them become more successful traders. Below, we will look at some of the most important technologies crypto traders are using to help them in this endeavor. Here are five technologies crypto traders can’t live without.
If you plan on owning any type of cryptocurrency, you need a place to store it. Cryptocurrency comes with two types of identifiers, known as keys. The public key is the one shared with the world so that the existence of the coin or token is known. The private key is the code given to the owner of the coin to establish ownership. This key is what you have to store and protect in a crypto wallet.
There are two major types of crypto wallets, hardware, and software. Hardware wallets are physical objects that plug into your computer. These are the most secure way to hold your cryptocurrency. The issue is, hardware wallets can be expensive and they are more difficult to access. If you trade frequently, a hardware wallet is probably not for you.
Software wallets come in many forms. You can find a desktop wallet for your personal computer, a mobile wallet for your phone, or a web wallet that you can access from any browser in the world. The software wallets are listed here in order from most secure to least secure but the order reverses when considering which wallet is easiest to access and trade from.
None of these wallets are inherently better than any of the others. What you choose entirely depends on your preferences and needs. The general idea is to pick the wallet with the balance of security and accessibility with which you are most comfortable. This Cove Markets article has some tips for selecting a crypto wallet.
Real-Time News Aggregation
Crypto trade exchanges are all around the world. So the markets for cryptocurrencies are open 24/7/365. The market is extremely volatile, meaning that the prices can change at a moment’s notice and have a huge effect on the cryptocurrency you are trading. Because of these facts, you need to get the most up-to-date news as fast as possible.
The speed of the market makes it a necessity for traders to have the absolute latest news as soon as it comes out. This will help you make informed decisions without being blindsided by a recent development. To get this kind of news, crypto traders rely on crypto-specific news aggregators. These aggregators use algorithms to gather information from dozens or even hundreds of sites and social media platforms to put the most relevant, timely crypto news in front of you when you need it.
Many sites aggregate the latest crypto news. To find the one that works best for you, sampling a few of them is a good idea. Coindesk and Cointelegraph are both good sites that look and feel like blogs and webpages with which you might already be familiar. Other sites, like CryptoPanic and FAWS, are a little more in-depth and do a really great job of finding all the news in crypto you need to know.
Studying live charts is one of the most popular ways for traders to understand the trajectory of different cryptocurrencies and identify patterns in their price fluctuations. Studying these charts and using the insights to make profits is known as technical analysis (TA). The most successful traders excel at TA and use the insights they gain from this analysis to help them pounce when conditions are right so they know whether to buy or sell at the exact right time.
You can find multiple sites that provide live trading charts on different cryptocurrencies; most of the biggest and most popular exchanges provide them as well. These charts show trends and all types of technical indicators to help you beat the market and turn a profit. It will definitely take beginning traders some time and research to figure out how to read and use these charts effectively but it is worth it in the end.
TradingView is one of the most popular sites for live trading charts. Many pros use it because it gives traders many options and features. Cryptowat.ch, owned by the Kraken exchange, is another site where you can get helpful charts. It is free to use. Wherever you get your charts, using this technology can make the difference between winning and losing in the crypto trading market.
Like any investment, there are tax implications that come with trading crypto. The standard (and good) advice, is that you should always consult a tax professional with any kind of investment. Unfortunately, many tax professionals may not be all that familiar with the tax ramifications of trading cryptocurrencies. One way to take matters into your own hands is with crypto-specific tax software.
Many crypto tax software programs are available. You want to evaluate for several factors to find the program that is best for you. Consider what exchanges the software is compatible with, how easy it is to use and understand, what type of reports it generates, and if it is compatible with IRS requirements.
It is no surprise that traders are employing all sorts of technology to find success trading technology-based currencies. In addition to the technology above, traders can find different software, hardware, websites, and programs to deal with almost every aspect of trading crypto. At this point in the crypto lifecycle, many kinds of tech are available but very few pieces that have truly risen to the top. To become a successful trader, it is up to you to try different resources and evaluate each of them to determine what works best for your needs and style.