There are many debates about crypto trading. On the one hand, the market of digital assets is incredibly volatile, which allows for making enormous incomes from buying and selling coins. Still, on the other hand, this high volatility does not always play into the hands of traders and brings considerable losses. Indeed, the risks of trading crypto are much higher than trading any other asset or commodity because the market of digital assets is still emerging and too sensitive to external factors and new backgrounds; plus, the market is not controlled by governments directly so no one can keep crypto rates at the same level.
So before you start to trade crypto, you should understand the main risks you face. Let’s discuss them in this article.
Crypto prices go up and down daily, and those fluctuations can be sharp and significant. So you risk buying, for example, a LINK coin, and the next day, its price will drop. To succeed in trading and catch the wave of price fluctuations, traders do a lot of work analyzing price charts and trying to predict the next price movement.
When you buy crypto online and leave it on a crypto exchange, you risk losing funds because of a hacker attack. To avoid such a scenario, you should pick only reliable and credible platforms with official registration and license, for example, WhiteBIT.
Risk of Losing Private Keys
If you store your investments on a crypto exchange, then in the case you lose your password, the service can help you recover your private keys, for in this case, both you and the exchange have it. If you keep your funds in a non-custodial wallet, that means the kay belongs to you only, and if you lose it, no one can help to recover it.
When you seem to pick the perfect crypto to trade, it may change its price direction unexpectedly, moving to the opposite side and ruining all your plans to earn. There are some events you cannot count on when forecasting crypto prices – changes in the world’s economy, political decisions, large exchanges’ bankruptcy, etc. That is the reason why it is better to diversify your investment portfolio.
To buy crypto online, feel free to use the WhiteBIT exchange:
- pass KYC;
- move funds to your account from your bank card;
- open the trading position;
- pay the fee.
The platform will send the needed crypto coins to your account in a few minutes.