The Definitive Beginners Guide to Ethereum Trading [2020 Revision]

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Binance’s fees are quite expensive in comparison to other platforms like PrimeXBT, however BNB can be used to make trading somewhat less expensive, although it is important to understand that even with the discount in price trading is still not cheap here.

Binance continues to increase the number of assets listed on their platform, and as that number grows Ethereum traders will have more options available also in the future.

There are many ways to trade cryptocurrencies like Ethereum and although obvious favorites like buy low, sell high, and long term holding or “HODLing” are used by many traders, there is a spectrum of different strategies that can be used.

HODLing

HODLing is a popular catchphrase within cryptocurrency circles that means to buy an asset and hold it for a long time, no matter whether the price goes up or down.

Maybe surprisingly to many that are new to cryptocurrency, hodling has been historically one of the most successful strategies, although there are many other strategies that deliver higher returns for lower risk.

This is obviously the easiest strategy possible however, so if you don’t mind waiting a year, or two, or three for a payoff and don’t want to learn about trading, this might make sense.

Margin Trading: Shorting, Leveraging

Margin trading is the use of borrowed money to create trades that are not normally available, and platforms such as PrimeXBT specialise in Ethereum margin trading, as well as margin trading for many other cryptocurrencies.

The two main types of margin trading are shorting and leveraging.

Shorting is the process of borrowing funds and selling them, then waiting for the price to be lower in order to rebuy at less than the original cost.

This strategy allows traders to profit from downwards price actions, instead of always having to try to buy low and sell high.

Leveraging is borrowing funds and then creating trades that are much larger than normally available. You can leverage by 50x for example, and then for every $1 you would have normally made, you will now make $50.

Ethereum Algorithmic Trading

Algorithmic trading or “bot trading” is the process of programming computer programs to continuously run strategies of buying and selling cryptocurrency at different times, depending on the orders that you have given them.

While there is a need to understand trading and programming in languages like C++ or Python, bot trading can be extremely profitable, especially when strategies such as market making, arbitrage and HFT are considered.

Trading Ethereum isn’t the only way to make money with it — in fact there are a number of different ways to make money that don’t require an understanding of trading at all.

Ethereum Mining

Ethereum is a proof of work cryptocurrency, which means that thousands of computers are constantly trying to solve a puzzle which when solved by one of the computers provides them with a free amount of Ethereum.

These computers or “mining rigs” can be set up in a house with a cluster of GPUs being connected together, or can be more large scale with entire factories being turning into “mining farms” worth millions of dollars.

Ethereum Faucets

Ethereum faucets are websites that give out free Ethereum — sometimes for doing nothing, sometimes for completing a very small task like going to a website.

While no-one ever got rich from Ethereum faucets, they have a very low barrier to entry and you will actually get paid for what you do, even if it is only a few cents at a time.

Ethereum Bounties/Referral Programs

Bounties and referral programs can be found throughout the cryptocurrency world, with some programs such as PrimeXBT’s 4-tier referral program providing the potential to earn significant rewards by sharing details of the platform in social media and to friends.

Bounties are provided by many different projects, with Ethereum itself even having its own bounty program to find bugs in their system

Today Ethereum has become the 2nd largest cryptocurrency, and is seen by some as the only other crypto-asset that has breached the mainstream apart from Bitcoin.

One of Ethereum’s main issues has been technical problems its had with scaling. When the ICO boom of 2016 came about, the Ethereum blockchain laboured under the increased pressure and transaction times became so sluggish that many people began questioning if Ethereum could be a viable cryptocurrency in the future.

Since then until now, the project has expended a huge amount of effort redesigning their systems, and fixing the scaling problems that have held them back.

Free Bitcoins: FreeBitcoin | BonusBitcoin

Coins Kaufen: Bitcoin.deAnycoinDirektCoinbaseCoinMama (mit Kreditkarte)Paxfull

Handelsplätze / Börsen: Bitcoin.de | KuCoinBinanceBitMexBitpandaeToro

Lending / Zinsen erhalten: Celsius NetworkCoinlend (Bot)

Cloud Mining: HashflareGenesis MiningIQ Mining

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