Cryptocurrency trading courses aren’t as old as the fad itself.
The first time the internet exploded with the cyptocurrency mining frenzy, i remember that there weren’t a lot of websites offering to teach people about it. Needless to say, it was more of a trial and run experiment for many folks looking to either mine Cryptocurrency, or just get on with setting up a basic rig to get started.
Fast forward to 2021, not only do we have a plethora of platforms that teach you all about Cryptocurrency through in-depth Cryptocurrency trading courses, but they also help to give a sense of direction to learners at their own peril!
Yep, there’s still a high chance that despite learning the ropes from one of the best Cryptocurrency trading courses online, you may end up with a very menial success rate.
To that effect, after you’re done learning through a course, you won’t have to scramble for making investments in heavy-duty Cryptocurrency mining equipment. Most of the stuff can be done online. That doesn’t mean that Cryptocurrency mining hardware isn’t important, it works like a charm.
However, at the beginner level, take one step at a time to apply your concepts. Be patient, compare your monthly results, and then move on with purchasing equipment or making bigger investments.
What Does This Post Cover?
As it’s evident from the title: ‘Cryptocurrency Trading Courses For Beginners’ highlights some of the fundamental concepts that are often overlooked by first-timers.
Here’s some basic information to skim through if you are not looking to go through the entire post:
- Fundamental Beginner Level Cryptocurrency Trading Concepts: Think about margin trading, Blockchain, nodes etc.
- Hands-On Approach to Cryptocurrency Farming/ Mining
- Best Cryptocurrency Trading Courses Available Online
- Proof of Work and Proof of State Concepts etc.
The Concept of Margin Trading for Bitcoin Beginners
Margin Trading is when you borrow bitcoins/USD and bet against bitcoin going up or down. So you go “long” (this means betting bitcoin will go up) and you’ve borrowed 2 bitcoin. Bitcoin goes from $100 to $120, you’ve made $40.
You take the profit, and give the bitcoins back + a small fee. If the price were to go down to $80, you’ve lost $40, and need to pay that back to the lender.
Say you actually owned 1 bitcoin in the scenario above (non-borrowed). That’s 2:1 margin trading (ie: losses are amplified 2x). If you lost $40, you would need to sell part of that bitcoin to pay the lender back.
If bitcoin went from say, $150 to $100, that’s a $100 loss (since you borrowed 2 bitcoins and each lost $50), and you’d have to sell your entire bitcoin to pay back the lender. When you’re “forced” to sell like that, it’s called a “margin call”.
So because so many people are going long right now, and the price crashes, they get margin called, are forced to sell their bitcoin, which drives the price lower… creating more margin calls. I’m sure you get it.
What are The Best Cryptocurrency Trading Courses Online?
Aside from margin trading for any sort of Cryptocurrency, there’s a lot more to Cryptocurrency trading than what meets the eye. Speaking of which, here are some of the best Cryptocurrency online trading courses that you can sign up for to get started.
Do bear in mind that the learning curve for each of these courses varies. Some of them are too tough to begin with, while others only cover elementary-level concepts at best. Needless to say, if you were to staple multiple courses at the beginner level, it’ll give you the best results.
1. An Intro to Crypto Currency for Complete Beginners:
This one’s hosted at Udemy as a fairly moderate compendium of Cryptocurrency basics.
For those people who have literally little to no knowledge about Cryptocurrency, other than the fact that they’ve only heard about ‘Bitcoin’ and ‘Bitcoin Mining’, this online course is extremely useful.
Besides, Udemy keeps running its discount campaigns. So, whenever the price drops to, let’s say between $9.99 to $18.99, you can buy this Cryptocurrency trading course without any hassle.
You will learn the technology and mechanism behind Blockchain alongside a practical demonstration of the best practices to adopt when getting started in this realm for the first time.
2. Cryptocurrency Technologies and Bitcoin
If Udemy doesn’t cut it for you, sign up for ‘Bitcoin and Cryptocurrency Technologies’ course at Coursera’s official website.
As far as the course rating goes, this Cryptocurrency trading course maintains a staggering 2.6K+ reviews, and about 500K students, who have enrolled already for the classes starting on June 2.
So, yes, NOW would be the best time to sign up for this Cryptocurrency course online. You will learn a great deal of information about Bitcoin and other types of Cryptocurrencies. The instructor details how anonymity works for users in the coin mining industry, and many other foundation-level things to get you started.
if you have gone through this course with due diligence, you will be able to set up your own Cryptocurrency mining rig, make investments in different online Cryptocurrency purchases, and identify low vs high-risk opportunities at best.
At a bigger level, students of this Cryptocurrency trading course are easily able to integrate Bitcoin and other Cryptocurrency mining projects into their ongoing work processes. This also reminds me of the fact that Blackhat Cryptocurrency miners go to lengths to unethically use resources to mine currency without “miners’” consent.
It’s a debatable concept, but let’s leave it for another day.
3. Cryptocurrency Foundations:
Dr. Jonathan Reichantal’s Cryptocurrency trading course comes off as a refreshing intake on the creation and mining of the notorious virtual currency.
- How did the creation of Bitcoin come to be?
- Is it still a wise decision to invest hundreds of hours of energy, monetary and financial resources to dig up Bitcoin on the internet?
- What’s the best way of calling the shots on potential Bitcoin mining scams?
- Ethical vs Non Ethical Cryptocurrency Trading Concepts
- Ensuring that you have signed up for a secure Cryptocurrency wallet account
… and about a bazillion other things.
The best part about this Cryptocurrency trading course online is that it’s hosted at LinkedIn. Therefore, credibility is not such a big issue. However, you still might want to go through the course content before signing up for it.
In case, you have already honed your skills at a basic level, you’d want to move on to some of the advanced courses that the industry has to offer.
4. Open Source Tools (*OSINT) For Cryptocurrency Forensics
The last one on our list of Cryptocurrency trading courses is a compilation of use cases and practical insight on how to use open-source tools for Cryptocurrency forensics?
Unlike other courses in this write-up, this one comes with a handy software installation guide, working through real-life cases and different projects that you are supposed to submit by the end of each milestone.
It’s fairly easy to say that after the course completion, you will be equipped with the knowledge and some starter-level skills to understand how criminal activities work in the notorious Cryptocurrency industry.
Forensics comes with a sense of enlightenment towards using tools and developing keen hindsight on how to detect fraud, scams, and other potentially illegal activities in Cryptocurrency that lead to unsavory results.
Due to the anonymous nature of the Cryptocurrency industry itself, there’s always a gap between skills that are yet to be learned and whatever modern-day crime ensues in the cyber universe. However, once you have understood the basics of how Bitcoin hash commitment schemes work, Cryptocurrency operating mechanisms, and other elements, you will be able to seek a professional career in the Forensics department of your choice.
This is a Project-based Course (Learning) and learners are required to complete to apply the skills acquired.
Blockchain
Cryptocurrency, Bitcoin, Ether are all blockchains. Blockchains are basically a spreadsheet (LEDGER) that is duplicated multiple times across a network and updated regularly simultaneously. There is no centralized version of this ledger.
It is hosted simultaneously by thousands/millions of computers. These ledgers will update on their own, Bitcoin as an example automatically checks itself every 10 minutes.
Each of these 10-minute increments of transactions (in bitcoins case transactions would be sending or receiving bitcoins from one person to another for goods or services) are called BLOCKS. For these blocks to be confirmed, accepted, and updated to the ledger nodes are required.
Nodes (Mining/Forging)
A node is a computer running the blockchain software on the network. The blockchain software will automatically download the entire ledger of all transactions since its inception.
At regular intervals, the software will take the transactions of a block (data on the ledger) and convert them into a mathematical puzzle to be solved by randomly chosen nodes (MINING). Mining requires powerful processors (typically GPUs) and substantial quantities of energy to receive mined tokens profitably.
When a specific number of nodes solve the puzzle with the same answer they are basically confirming that the data on the block is accurate as multiple independent nodes found the same answer. When confirmed, the block gets added to the previous blocks making a chain of blocks aka a blockchain.
As an incentive to run your computer as a node you are rewarded with TOKENS. If a single person or group of people wanted to manipulate the ledger, the amount of machinery and electricity used to achieve the majority of miners thus allowing you to manipulate the ledger is so exponentially expensive that it serves no reasonable purpose.
This is an example of a Proof of Work Blockchain System (computer solves puzzle and rewarded with tokens)
Tokens
Tokens are part of the core of the blockchain.
They are an incentive to validate transactions and create blocks. They gain intrinsic value based on the blockchain they are associated with. Some blockchains grant token holder’s different abilities.
With Bitcoin, tokens are needed to pay for transaction fees. Others allow voting rights on how certain blockchain functions are managed. There is a limited amount of Bitcoin that will ever be released to nodes (21 million expected to be all be released by 2033) which also keep inflation from being a problem.
Blockchains can create their platform with whatever number of tokens they would like and release them or create means to mine them as they see fit. Essentially, as with any other fiat money (currency that a government has declared to be legal tender NOT backed by a physical commodity), as adoption and trust increases the value of the token will increase.
If most people accept Bitcoin for services and stores accept Bitcoin for goods than it is as good as the next currency.
Wallets
Whether you mine for tokens, are paid in tokens for goods or services or purchase tokens from a person or currency exchange you need a place to store them securely and a way to send and receive them.
Cryptocurrency Wallets don’t store currency, they hold your public and private keys that interface with the blockchain so you can access your balance, send money and manage your funds. The public key allows others to send money to the public key only.
A wallet that is “offline” (see Hardware or Paper below) cannot access funds or send money unless it is accessed with another form of wallet, either desktop, online, or mobile.
- Desktop Wallet – Installed on your computer and are only accessible from that SINGLE computer. Very secure but if someone hacks your computer you are exposed.
- Online Wallet – Run remotely (cloud based) and are far more convenient to access but make them more vulnerable as they are controlled by a third party and are also vulnerable to hacking attacks. Exchange wallets are online wallets but you are not in control of the private key. View it as a wallet that is lended to you so you can trade. The wallet is technically not yours.
- Mobile – Ran on an app and are useful as they can be used anywhere including retail stores
- Hardware – Private keys are stored on a tangible device like a USB drive. They can make transactions online but they are stored offline. Compatible with web interfaces and support many but not all currencies. To use, plug into a computer, enter a pin, send currency and confirm. Safest form of storage.
- Paper – Basically a physical printout of your private and public keys. It is not stored online anywhere and the only way transactions can happen is if you transfer money with the help of an Online wallet.
Most wallets provide a Recovery Mnemonic Passcode that is a series of words (typically 12 to 24 words) in a specific order. If you lose your login information for your wallet you can supply the mnemonic passcode and retrieve your lost login information.
If you lose your login information and your mnemonic passcode your wallet will be inaccessible and your tokens are lost to you. The above basically describes a first-generation Blockchain Cryptocurrency such as Bitcoin.
It is used basically as currency with no centralized entity regulating the release of additional currency and keeping the ledger of where the money is going secure and extremely safe from manipulation.
Second Generation Blockchain
The second generation blockchains sprung out of this environment with something more valuable. Utilizing the blockchain system to allow applications to be ran on top of a decentralized secure system. Instead of just recording transactions, contracts could be transmitted the same way.
More complex transactions (SMART CONTRACTS) allow for things such as: – Funds to be spent only when a required percentage of people agree – Manage agreements between users (such as insurance) – Provide utility to other contracts
- Store information about an application such as domain registration information or membership records This basically can allow applications to be ran on top of the blockchain system. This can cut out the middleman for many real-world applications (mortgages, banking, communications, security confirmations etc.)
Proof of Work/Proof of Stake
As I mentioned earlier, Proof of Work (PoW) requires nodes to solve a mathematical puzzle which is rewarded with tokens. Proof of Stake (PoS) is different, the tokens with proof of stake systems are pre-mined meaning they are all created when the blockchain system is created. Blocks are not verified by the typical method.
The block validator uses the blockchain software to stake their tokens and is chosen based on specific factors depending on how many tokens the person holds and for how long. Depending on how many tokens they hold will restrict the number of blocks they can validate.
If they own more they can validate more often but all validators will be chosen randomly keeping the rewards fairly distributed (unlike PoW which typically rewards the first completed.) The blockchain still requires a mathematical puzzle to be solved but it is much easier than PoW requiring far less time and energy.
If the blockchain has premined all of their tokens then new tokens cannot be mined for rewards in PoS. The reward for staking your tokens to be a validator is a portion of the transaction fee that is charged as part of normal transactions on the blockchain.
That is why PoS miners are called forgers. If manipulation is attempted then their stake can be taken from their wallet adding more motivation to prevent data manipulation.
Fork or Hardfork in Cryptocurrency Trading:
Some cryptocurrencies may need to update or upgrade the coding of their blockchain software. When this happens usually a fork occurs. This basically means the cryptocurrency splits into two separate cryptocurrencies.
Because the nature of blockchain technology, they are decentralized and autonomous so the older version cannot be deleted or removed. If people choose to continue using the old version they can.
For mining/forging purposes the nodes will need to choose which they will mine/forge and download the blockchain software on their computer to proceed. When the fork occurs, anyone holding tokens in the original currency will be given the same number of tokens in the forked currency.
(When Bitcoin forked to Bitcoin Cash, anyone holding x amount of Bitcoin would receive a new wallet for Bitcoin Cash also containing x amount of Bitcoin Cash.) This is called a Hard Fork and all previous transactions are made invalid.
There are also Soft Forks, in this case, it is backward compatible and all previous transactions are valid. This can result in two currencies but in most cases, it doesn’t as it is usually accepted by most miners/forgers because it is backward compatible.
Exchanges
Online currency exchanges allow you to buy, sell or exchange fiat money (USD, EUR, etc) with digital currencies or in most cases digital currencies for other digital currencies.
There are a large variety of different exchanges that are operated in multiple countries but there are around a dozen that the majority of cryptocurrency trading volume is present on.
Not all cryptocurrencies will be listed on all exchanges, some have specific prerequisites to be listed on their exchange and there may be fees associated as well.
Once your account is set up you will have a list of all available cryptocurrencies to trade. Each currency will have an associated online wallet with the public key address allowing you to send that specific currency to that wallet.
(Many exchanges are having delayed or canceled identity verification, currency transfers and lack sufficient customer support due to the influx of new traders) Examples of top exchanges:
- Coinbase (trades fiat)
- GDAX (trades fiat)
- Gemini (trades fiat)
- Changelly (trades fiat)
- Bittrex
- Binance
- HitBTC
- EtherDelta
- Bitfinex
- Kraken
- Bithumb
- Bitstamp
- Poloniex
- OKEx
Sending/Receiving Cryptocurrency Tokens
All wallets have the ability to send digital currency to other wallets. The function is relatively easy, make sure the currency you are sending is going to the appropriate wallet for that currency.
Ethereum tokens cannot be sent to a Bitcoin wallet for example. (The tokens aren’t actually moving location; the list of transactions/ownership is what is stored in the wallet). Triple check the wallet private key you are sending the tokens to.
If you type the wrong address the tokens will be lost in nearly all incidents. Some mobile wallets allow you to scan a QR code that will automatically enter the public key rather than copying/pasting or typing out the public key.
Taxes vs Cryptocurrency Trading Online
As of January 1, 2018, it appears that the tax on digital currency has changed. Every trade between any digital currencies (Bitcoin to Ether, Ether to Litecoin, etc) will be a taxable transaction.
If you hold the currency for longer than one year then you will pay capital gain tax when it is traded or sold (15%-20%) and if you sell or trade-in less than a year you will have to add the profit to your taxable income to adjust your tax bracket.
Altcoins
Altcoins are basically any coin that is not Bitcoin. Most cryptocurrencies do not have a native blockchain (their own independent dedicated blockchain). Bitcoin, Ether, Ripple, Waves, NXT, Cardano all have their own native blockchain.
Many other cryptocurrencies run on other cryptocurrency blockchains. Litecoin runs on Bitcoins blockchain, hundreds run on the Ethereum blockchain. These currencies act as smart contracts running on the adopted blockchain.
DApps (Decentralized Applications)
For a blockchain application to be considered a DApp it must be
- Open source, code available to all
- Decentralized, uses blockchain cryptographic tech
- Incentive, must have tokens to fuel itself
- Algorithm/Protocol, generates tokens and has a built-in consensus mechanism (mining/forging.)
There are 3 types of DApps, each basically piggybacks off the platform of the previous Type 1 – Have their own blockchain (like bitcoin) Type 2 – Use the blockchain of Type 1 DApps Type 3 – Use the protocol of Type 2 DApps
ICO (Initial Coin Offering)
Much like an IPO (Initial Public Offering) that offers stock in a private company to the public, an ICO raises money for new Cryptocurrency ventures.
Typically, a minimum investment is required in the form of a cryptocurrency such as Bitcoin or Ether and the investor is given tokens of the cryptocurrency at a reduced cost.
Due to the fact that ICO’s are so new, government agencies have not begun regulating these ventures making them extremely risky as anyone with a competent coder can create and market a cryptocurrency that can be used to swindle investors who aren’t cautious.
The US government no longer allows its citizens to participate in ICO’s and if you are using a computer with an IP address located in the United States, ICO’s websites will not allow you to invest.
Where to Research for Additional Cryptocurrency Trading Concepts?
- Whitepapers – Each cryptocurrency will have its own dedicated websites and most will have a whitepaper that has a description of what their cryptocurrency is designed to do.
- Roadmaps – Also on each cryptocurrency’s website, they tend to have a roadmap or timeline as to when they are planning to complete certain milestones be it added features to the blockchain or wallet or any other important events.
- com – List of every available cryptocurrency, the exchanges they trade on, market cap, trade volume, available tokens, newly created tokens, etc.
- org – Forums specific to individual cryptocurrencies. There is a lot of self-marketing (bounties) on this site. Take what they say with a grain of salt
- Twitter/Facebook (Social Media) – Many times news from team members or the cryptocurrency’s social media page will break news before it is listed on any of the above mentioned outlets.
Find out who is working for the cryptocurrency you are interested in and start following the team’s social media. Don’t forget to look at their Linkedin accounts if available, previous employment, and behavioral history to confirm they are competent.
Common Terms/Slang
Shilling – Covert advertising, personally endorsing a token so as to manipulate the price to either recoup a loss or increase gains on a token the individual owns.
FUD – Fear, Uncertainty, Doubt; another method to manipulate the price of a token the person owns by making others second guess their investment decision on a specific token.
FOMO – Fear Of Missing Out; buying a token (usually after the price has already increased) hoping they haven’t missed the majority of a price increase.
Shitcoin – A cryptocurrency that has become worthless over time or a scam operation. To the Moon – Massive increase in a token’s price.
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