Beginner’s guide to trading digital coins

5
min read

Beginner’s guide to trading digital coins

5
min read
Glass-like 3D icons of popular cryptocurrencies including Litecoin, Bitcoin, and Polkadot, floating against a dark background.
Lesson
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minutes

Most of us use digital money every day-think about when you tap your card or make an online purchase. But what if money could exist purely in digital form, without banks or governments controlling it? That’s where cryptocurrency comes in. 

Let’s dive into the world of crypto and see how you can start trading it like a pro.


What is cryptocurrency?

Cryptocurrency is a type of digital currency that exists only online. Unlike traditional money, it’s not issued by any government or bank. Instead, it operates on blockchain technology-a secure and transparent digital ledger that records transactions across a decentralized network.


Why is it called "crypto"?

The "crypto" in cryptocurrency comes from cryptography, a method of securing data. Every transaction is encrypted, making it nearly impossible to hack or alter. This level of security is one of the biggest reasons crypto has gained so much trust and popularity.


Is cryptocurrency safe?

Yes! Blockchain technology makes crypto transactions incredibly secure. Unlike banks, which store your financial data in one place, cryptocurrency transactions are spread across thousands of computers. This decentralization makes hacking much more difficult. Plus, each transaction is cryptographically secured, meaning only authorized parties can access the data.


Why trade cryptocurrency?

Crypto trading isn’t just a trend-it’s a revolution. Here’s why traders love it:

  • No Middlemen – Trade directly, without banks or brokers taking a cut.
  • 24/7 Market – Unlike stock markets, crypto never sleeps. Trade anytime, anywhere.
  • Big Profit Potential – Crypto’s volatility creates opportunities for high returns (but also high risks!).
  • Global Accessibility – No need to deal with currency conversions—crypto is borderless.


How does cryptocurrency trading work?

You’ve got two main ways to trade crypto:

  1. Buying and Holding – You purchase cryptocurrency and store it in a digital wallet, hoping its value increases over time.
  2. Trading Without Owning – Using Contracts for Difference (CFDs) or multipliers, you can speculate on crypto price movements without actually owning the asset. This allows you to profit from both rising and falling prices.


Which cryptocurrencies are best for trading?

There are thousands of cryptocurrencies, but these are some of the biggest players:

Cryptocurrency What makes it special?
Bitcoin (BTC) The original and most valuable crypto, often called “digital gold.”
Ethereum (ETH) More than just a currency—Ethereum powers smart contracts and decentralized apps.
Tether (USDT) A stablecoin tied to the US dollar, offering less volatility.


If you’re just starting out, Bitcoin is a great first choice due to its popularity and stability. As you gain confidence, you can explore other cryptocurrencies to diversify your trading portfolio.

Where can you trade crypto?

At Deriv, you can trade cryptocurrency CFDs on Deriv MT5, Deriv X, and Deriv cTrader, or try out crypto multipliers on Deriv Trader. Not sure where to start? Open a free demo account and practice risk-free before diving into live trading.

Ready to trade?

Now that you’ve got the basics down, why not take the next step? Open your Deriv crypto trading account today and start exploring the exciting world of cryptocurrency trading!

Sign up now and take advantage of market opportunities!

Quiz

What was the first real-world purchase made with Bitcoin?

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A Tesla car
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A cup of coffee
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Two pizzas
?

FAQs

How do I start trading cryptocurrency?

First, choose a trading method-buying and holding or trading via CFDs. Then, sign up for a trading platform like Deriv, deposit funds, and start trading!

Can I trade cryptocurrency with a small budget?

Absolutely! You don’t need to buy an entire Bitcoin-you can trade fractions of a coin. Deriv also offers leverage, letting you trade with a small deposit while controlling a larger position.

What’s the biggest risk in crypto trading?

Volatility! Crypto prices can change rapidly, leading to both big wins and big losses. Always trade responsibly and use risk management tools like stop-loss orders.