How To Start A Bitcoin Business; There are not many people who know how to start a Bitcoin business and become successful in it. This line of business requires a very rich extent of knowledge on how it works. This is because of the novelty of the crypto ecosystem at large.
The need to understand the different trading models and how best they find relevance under specific conditions is integral to starting a Bitcoin business. This article is structured to serve as an inroad into the causative factors that trigger Bitcoin price shift as shown by records, conditions that influence Bitcoin market behaviors, and the ideal exchanges for newbies looking at how to start a Bitcoin business.
Starting A Bitcoin Business; What You Need To Know
The concept of Bitcoin business simply borders on buying and selling Bitcoin; it’s about buying Bitcoin with the hope of selling at a higher price than that at which it is bought much later.
This means, except if the Bitcoin market behaves in a way that aligns with this, you’re certain to experience loss. Below are concepts that you must understand if you have to succeed in the Bitcoin business endeavor.
- Hodl
- Types of trading
- Factors triggering price shift
1. HODL
The concept of “HODL,” as it pertains to the Bitcoin business, refers to the idea of not selling one’s digital assets even in the center of a terrible market downturn. It’s a business strategy, an acronym that represents “Hold On for Dear Life.” This pattern requires that a Bitcoin trader doesn’t sell hastily regardless of terrible price fluctuation and negative volatility.
HODL is a very important aspect of trading Bitcoin. An instance of the importance of this strategy is seen in one of the most brutal Bitcoin bear markets in 2022, which had BTC sinking to a 20,000.00 USD market value. However, in 2023, Bitcoin now sells for over 27,000.00 USD. This means every person who bought Bitcoin at 22,000.00 USD before it sank to 20,00.00, now has a 5,000.00 USD gain to every BTC unit they held without selling.
Types of trading
Understanding how to start a Bitcoin business means understanding that there are different trading strategies, and not all are befitting of every trader. For instance, scalp trading is more befitting of newbies as it’s a trading type that takes advantage of smaller price shifts to make subsequent gains that’d sum up to something big.
Dollar-cost averaging (DCA) as a strategy, on the other hand, is more befitting of traders with rich trading portfolios. This strategy encapsulates the diversification of investment across different times regardless of the crypto price at that time. And for the fact that Bitcoin price is constantly faced with a price shift, the principle of DCA advises traders to only sell from every single investment across one’s portfolio only on the condition that it is at a price higher than that which it was bought for.
Other trading strategies include:
- Range trading
- High-Frequency Trading (HFT)
- Day trading, etc.
It’s important to understand them all if you must be successful in the Bitcoin business.
3. Factors triggering Bitcoin price shift
The giant factor that influences the Bitcoin price shift is simply the law of demand and supply. So, the question here is, what then triggers the need to buy or sell? You have them below.
(a). Social media hype:
When there’s been speculation of positive turnout of events about certain crypto on social media, there’s a good chance that the crypto is going to experience a spike in market value. Bitcoin is no exception.
(b). Adoption by giant bodies
The concept of cryptocurrencies being money is only because people agree that it is, and tied value to it. Now this gives an extent of liquidity. This means that you can be certain of a Bitcoin price spike if any giant body makes it public that it’s adopting it as a legal tender. This was seen with Dogecoin and Tesla as made public by Elon Musk.
(c). Government regulations
Negative government regulations, especially from influential first-world countries, can have a negative influence on crypto prices. It’d lead to panic sellers flooding the market, thus resulting in excess supply over demand. And when this happens, the price falls.
Conclusion
Starting a Bitcoin business is not as difficult as it has been made to seem. It all boils down to how well one understands the crypto ecosystem’s modus operandi and sticks to the principles that guide it. There are different trading strategies, and one of the undoings of most traders is failing to identify the peculiarity of their portfolio and not adopting a trading pattern that syncs with it.
Read Also; How to Maximize Bitcoin Profit
