Cryptocurrency is one of the assets with the highest earning potential, but such earning potential comes with high risks. In the past few weeks, most cryptocurrencies had a bad journey and a majority of traders are skeptical about their near-term performance. Don’t worry, bitcoin taking a plunge is not the end of the game and you can still make profits from it with the right tools. Here are several tips for traders, especially for beginners, to hedge the price crashes of bitcoin.
Understand Why Bitcoin Took A Plunge
The sell-off last week could be mainly attributed to market FUD bought by China’s crackdown on mining firms and Elon Musk’s reversed attitude on Bitcoin. The lack of momentum to establish $60k as support also exhausted the market. Cryptocurrencies, including Bitcoin, are relatively new and speculative. So it is best to keep yourself updated with market news. Some exchanges offer market analysis and news feed subscriptions, as well as trading advice to users.
Change Your Trading Strategies
Futures trading is specially designed for traders to hedge loss and to profit from market volatility rather than be stuck simply stashing their coins. Traders can borrow leverage from exchanges to greatly enhance their buying power. Futures trading with leverage is extremely profitable during market sell-off, where large quantities of bitcoin are dumped into the market.
For instance, if you use 1 BTC and 100x leverage to short bitcoin at $35,000, when bitcoin drops to $33,000, you will earn ($35,000 – $33,000) * 100 BTC/$33,000 = 6.06 BTC.
Take A Break From Trading
Trading Bitcoin is very stressful, especially with Bitcoin continuing to drop. It would be better to stop trading for a while and focus on your real-life when you are feeling too stressed. An interest wallet can help you grow your wealth when you take a break. Take the Bexplus wallet as an example, it offers up to 21% annualized interest to users and the deposits can be withdrawn at any time.
Why Trade on Bexplus?
- No KYC, No Information Leakage
Registration only requires your email confirmation and will only take a few minutes. Upon registration, you will get a real trading account and a demo account with 10 BTC for practice.
- No Deposit Fee and Fast Withdrawal
No deposit fee required, you can start your deposit at 0.001 BTC. To withdraw your deposit, you only need to file the request and confirm it by email. Withdrawal is 24/7 and usually, it can take as less as 1 hour during work hours.
- Demo Account For Practise
What better way to improve your skills than practicing in the simulator. There are 10 replenishable BTC in the demo account for traders to practice as much as they like, without taking any risks. You can also learn to analyze the market and use the toolkit with the demo account.
- 100% Bonus to Help You Maximize Profit
Double deposits, double profits. Users can get a 100% deposit bonus for every deposit on Bexplus. If you deposit 1 BTC, 2 BTC will be credited to your account, and the profits gained with the bonus are withdrawable.