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A Beginner's Guide for New TradersIntroduction to Cryptocurrency: Cryptocurrency has become a major financial trend in recent years, attracting both experienced traders and newcomers alike. If you're just starting out, this guide will help you understand the basics of cryptocurrency and what it takes to start trading. 1. What is Cryptocurrency? Cryptocurrency is a type of digital or virtual currency that uses cryptography for security. Unlike traditional currencies like the US dollar or Euro, cryptocurrencies operate on decentralized networks based on blockchain technology. This means that they are not controlled by any central authority, such as a government or bank. The most well-known cryptocurrency is Bitcoin (BTC), but there are thousands of others, including Ethereum (ETH), Ripple (XRP), and Litecoin (LTC). 2. How Does Cryptocurrency Work? Cryptocurrencies operate on blockchain technology, which is essentially a distributed ledger that records all transactions across a network of computers (nodes). These transactions are grouped into blocks and added to the blockchain, ensuring transparency and security. Since every transaction is verified by the network, there is no need for a middleman (like a bank), reducing transaction costs and increasing efficiency. 3. Common Types of Cryptocurrencies Bitcoin (BTC): The first and most widely recognized cryptocurrency, often referred to as "digital gold." Ethereum (ETH): Known for its smart contract functionality, Ethereum is a platform for building decentralized applications (dApps). Stablecoins (USDT, USDC): Cryptocurrencies pegged to the value of traditional currencies like the US dollar, offering stability and reducing price volatility. Altcoins: A broad term for any cryptocurrency other than Bitcoin. These include a wide range of coins like Litecoin (LTC), Ripple (XRP), and more niche coins such as Dogecoin (DOGE). 4. Why Trade Cryptocurrency? High Volatility: Cryptocurrency prices can fluctuate dramatically, providing opportunities for traders to profit from price movements. 24/7 Market: Unlike traditional stock markets, cryptocurrency markets are open 24/7, allowing traders to trade at any time. Global Accessibility: Cryptocurrencies are accessible to anyone with an internet connection, making it possible to trade from anywhere in the world. 5. How to Start Trading Cryptocurrency To start trading cryptocurrencies, follow these steps: Step 1: Choose a Cryptocurrency Exchange A cryptocurrency exchange is an online platform where you can buy, sell, and trade cryptocurrencies. Some popular exchanges include: Binance: One of the largest exchanges, offering a wide range of coins and trading pairs. Coinbase: Known for its user-friendly interface, making it ideal for beginners. Kraken: Offers a variety of coins and advanced trading tools. Step 2: Create an Account Once you've chosen an exchange, you'll need to sign up by providing your email and personal information. Most exchanges will require you to verify your identity before you can start trading. Step 3: Deposit Funds After creating your account, you can deposit funds into your exchange wallet. Most exchanges accept deposits via bank transfer, credit/debit cards, or other cryptocurrencies. Step 4: Choose a Trading Pair In cryptocurrency trading, you'll often be trading pairs, such as BTC/USDT (Bitcoin/US Dollar Tether). You'll be buying one currency while selling another. For example, if you believe Bitcoin will rise in value against the US dollar, you'd buy BTC/USDT. Step 5: Place a Trade There are two main types of trades: Market Order: This is an order to buy or sell immediately at the current market price. Limit Order: This is an order to buy or sell at a specific price. The trade will only execute when the price reaches your target. 6. Basic Trading Strategies There are several strategies traders use to make profits in the cryptocurrency market. Here are a few basic ones: HODLing: This refers to holding onto your cryptocurrency for a long period, regardless of market fluctuations, expecting it to rise in value over time. Day Trading: Buying and selling within a single day, aiming to profit from small price movements. Swing Trading: Holding onto an asset for several days or weeks, attempting to profit from short- to medium-term price movements. Scalping: Making quick trades for small profits over a very short time period, often minutes or seconds. 7. Key Concepts for New Traders Volatility: Cryptocurrency is known for its wild price swings. As a trader, you'll need to understand that prices can go up and down very quickly. Liquidity: This refers to how easily an asset can be bought or sold without affecting the market price. High liquidity means you can trade larger amounts without causing significant price changes. Market Capitalization (Market Cap): This is the total value of a cryptocurrency, calculated by multiplying the price by the total supply of coins. It gives a rough indication of the size and popularity of a coin. 8. Risks of Cryptocurrency Trading Market Volatility: Prices can swing dramatically, leading to significant gains or losses. Security Risks: Cryptocurrency exchanges and wallets are often targeted by hackers. Always use secure exchanges, enable two-factor authentication (2FA), and store your assets in a secure wallet (e.g., hardware wallet). Regulatory Risks: Governments may impose regulations on cryptocurrency trading, which could affect the market. 9. Security and Wallets When you're trading cryptocurrency, it's important to know how to secure your assets: Exchange Wallets: These are provided by the exchange where you trade, but they can be vulnerable to hacks. Software Wallets: Apps or programs where you store your cryptocurrency. They're more secure than exchange wallets but still vulnerable to online threats. Hardware Wallets: Physical devices, such as Ledger or Trezor, that store your crypto offline, offering the highest level of security. 10. Tax Implications In most countries, cryptocurrency profits are subject to taxes. Be sure to check your local tax laws and keep track of your trades for tax reporting purposes. 11. Start Small and Learn If you're a beginner, it’s important to start small. Trade with an amount you're comfortable losing, as the cryptocurrency market can be unpredictable. As you gain more experience and understand how the market works, you can gradually increase your investments. Conclusion Cryptocurrency trading offers exciting opportunities, but it also comes with risks. Understanding the basics, choosing the right strategies, and being cautious are essential to becoming a successful trader. Keep learning, stay updated with market trends, and don’t rush into decisions without proper research. #Crypto #Bitcoin #learn #Altseason #Bullrun2025
Education
by CRYPTOMOJO_TA
DreamAnalysis | DXY Insights with Major Price Zones AheadToday, we’re diving into the DXY (US Dollar Index), a key player in the forex market. We’ll break down its current price movements and explore what we can anticipate based on critical levels. 📊 Current Market Overview : At the moment, the price has swept through several key sell-side liquidity (SSL) levels, including the Previous Month Low (PML). We expected a retracement higher, but so far, price hasn’t made any significant moves. Now, price is hovering around an Equal Low (EQL), which also aligns with the Previous Week Low (PWL). With that said, the possibility remains that price could drive lower, clearing additional SSL levels. 🕓 Identifying Key Levels : Here are the critical levels we’re monitoring on the chart: - PMH: Previous Month High - PML: Previous Month Low - PWH: Previous Week High - PWL: Previous Week Low - EQL: Equal Low - BSL: Buy-Side Liquidity - 4H FVG: 4-Hour Fair Value Gap (potential retracement and imbalance zone) - Daily FVG: Daily Fair Value Gap These levels represent important zones where the price may gather liquidity, enabling it to move toward the next major target. The Fair Value Gaps (FVGs) are imbalances that price may revisit to "rebalance" and collect orders. 📈 Bullish Scenario : For a bullish outlook, we’ll need to see the price sweep the Previous Week Low (PWL) liquidity level, which is also an Equal Low (EQL). However, aggressive traders may look to lower time frames to find entries as price dips into low-resistance sell-side liquidity zones. 📉 Bearish Scenario : In a bearish scenario, we would need the price to sweep low-resistance buy-side liquidity (BSL) levels on lower time frames before targeting lower levels like the Previous Week Low (PWL). Currently, there isn’t strong confluence on higher time frames to aim for significantly lower prices. 📝 Conclusion : As we wrap up, it’s crucial to remain flexible and responsive to changing market conditions. Understanding key levels and potential scenarios allows us to refine our trading strategies and capitalize on opportunities. 🔮 Future Market Trends : Stay tuned! We’ll continue tracking the DXY, EUR/USD, and other major currency pairs, offering timely insights and updates as the market evolves. ⚠️ Disclaimer : The information provided here is for educational purposes only and should not be considered financial advice. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
TVC:DXYLong
by DreamAnalysis
GTAIUSDT can ascend further ! What Shall we Expect ?We have a Bullish Structure here Adam & Eve pattern is completed and now we testing the resistance cluster of Descending Resistance + A&E neckline + 1$ Key Zone☝️ Looking for a breakout and rally📈 ✅ Due to the Ascending structure of the chart... 🟢 High potential areas are clear in the chart. 🟢 Adam & Eve pattern. 🟢 AB=CD. ✨We spend hours finding potential opportunities and writing useful ideas, we would be happy if you support us. Best regards CobraVanguard.💚 _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ✅Thank you, and for more ideas, hit ❤️Like❤️ and 🌟Follow🌟! ⚠️Things can change... The markets are always changing and even with all these signals, the market changes tend to be strong and fast!!
Long
by CobraVanguard
DreamAnalysis | FTM Set for Major Move? Daily & 4-Hour AnalysisWelcome to today's analysis. Today, I will be analyzing FTM on the daily and 4-hour time frames for futures trading, reviewing entry and exit triggers, and discussing the potential trend of this coin over the coming days. 📰 Recent News Update : Before we start the analysis, I want to talk about the recent news surrounding this coin. The project has announced a major $100 million airdrop, which is expected to be distributed to its users in the coming months. To participate in this airdrop, you need to be active within the DeFi space on this network. In future sections, we will engage in DeFi activities on this network to accumulate points for the airdrop. 📈 Daily Time Frame Analysis : On the daily time frame, after a sharp price increase that pushed the price up to 1.1264, we saw a significant correction to the downside. After breaking 0.6179, the coin entered a downtrend, with the price falling to 0.3286. This support level is one of the strongest for this coin and has shown strong reactions in the past. 🚀 Current Uptrend Overview : Currently, after being supported at 0.3286 and breaking the descending trendline and resistance at 0.5307, the first wave of the upward movement has started. The buying volume has increased well, and during pullbacks and consolidations, the declining volume has shown the health of this new uptrend. The RSI indicator also shows high momentum for this coin in this time frame and has entered the overbought region twice during this wave. Contrary to many analysts, I believe that the price entering this region is not a sign of trend weakness, but rather an indication of strong buying power. 🛑 Resistance and Pullback Possibilities : After the recent upward wave, the coin has now reached resistance at 0.72 and entered a correction and consolidation phase. This correction could be a pullback to 0.6179 or 0.5307. If the price stabilizes below 0.5307, we could conclude that the uptrend is over and expect the long-term downtrend to resume. ⏳ 4-Hour Time Frame Analysis : In the 4-hour time frame, the upward trend is clear and noticeable, but after reaching the peak at 0.7160, volume has started to decline. During this time, the price has been fluctuating between 0.6282 and 0.6756, and volume has significantly decreased. For a long position, a risky trigger is at 0.6545 and the main trigger is at 0.7160. If the RSI holds above 62.54, it confirms the entry of bullish momentum in this time frame. 🔻 Short Position Opportunities : For a short position, the best trigger at the moment is 0.6282, and the best confirmation for this position is breaking the midpoint of the RSI. If 0.6282 is broken and the RSI confirms it, and if selling volume increases with the start of a downward wave, we can open more short positions on this coin. 🎯 Key Fibonacci Targets for a Decline : In case of a decline, potential targets and supports based on Fibonacci levels could be 0.5631, 0.5283, and 0.3638. In my opinion, 0.5283 is the most important and strongest support, not only because it’s the 0.5 Fibonacci level, but also because it overlaps with the pullback area we identified on the daily time frame. 📊 Final Thoughts on FTM's Future Trend : In my view, this coin will likely continue its upward trend for now due to the positive news surrounding it. With more users participating in the airdrop, the price of this project's coin is likely to increase further.
F
by DreamAnalysis
BNBUSDT: Why BNB Remains Bullish and Its Next Potential MoveHi. BINANCE:BNBUSDT the BNB is in a ascending triangle now which means the price will increase and also It is expected that the price would at least grow as good as the measured price movement(AB=CD) Note: we should wait for the breaking of the triangle and than make a move! ✨We spend hours finding potential opportunities and writing useful ideas, we would be happy if you support us. Best regards CobraVanguard.💚 _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ✅Thank you, and for more ideas, hit ❤️Like❤️ and 🌟Follow🌟! ⚠️Things can change... The markets are always changing and even with all these signals, the market changes tend to be strong and fast!!
Long
by CobraVanguard
2
DreamAnalysis | EURUSD Key Levels That Could Change Everything!✨ Welcome to this segment of our channel, where we dive into the key currency pairs shaping today's market landscape. 📆 Today, we're focusing on the EUR/USD pair and breaking down its current price action to uncover strategic trading opportunities. Join us as we analyze key levels and market dynamics to fine-tune our trading strategies and maximize potential gains. 📊 Current Market Overview : Currently, price has reacted strongly to the 4H Fair Value Gap (FVG), a key level we highlighted in our previous analysis. However, it has yet to sweep any significant levels such as the Previous Week High (PWH) or Previous Week Low (PWL). Patience may be key here, as we can wait for these levels to be swept before taking action. 🕓 Identifying Key Levels : Here are the critical levels we're monitoring on the chart: - PMH: Previous Month High - PML: Previous Month Low - BSL: Buy-Side Liquidity (important for a bearish scenario) - SSL (EQL): Sell-Side Liquidity (potential targets for market movement) - 4H FVG: Fair Value Gap (potential retracement zone and area of imbalance) - Daily FVG These liquidity zones represent crucial areas where the price seeks to gather orders, enabling movement toward the next significant level. The Fair Value Gaps (FVGs) highlight imbalances in the market that price may revisit to "rebalance" and collect orders. 📈 Bullish Scenario : In a bullish outlook, we could see a retracement lower to sweep Sell-Side Liquidity levels like the PWL or Daily FVG. Once these liquidity zones are cleared, we can anticipate upward momentum, with targets such as the Previous Month High (PMH) offering opportunities to capitalize on bullish movements. 📉 Bearish Scenario : For a bearish scenario, we might wait for a sweep of higher time frame Buy-Side Liquidity, or focus on lower time frames for short-entry opportunities. Whether the price interacts with the 4H Imbalance or forms new structures, identifying these shifts will be key to executing short positions aimed at the Sell-Side Liquidity levels. 📝 Conclusion : As we conclude our analysis, it’s vital to stay alert and adaptable to the ever-changing market conditions. By grasping the significance of key levels and understanding potential scenarios, we empower ourselves to refine our trading strategies and seize opportunities for success. 🔮 Future Market Trends : Keep an eye on the horizon! We will continue to track the evolving dynamics of the EUR/USD pair and other major currency pairs, providing you with timely insights and updates. ⚠️ Disclaimer : The information provided here is for educational purposes only and should not be taken as financial advice. Always conduct your own research and consult a licensed financial advisor before making any investment decisions.
Short
by DreamAnalysis
I Cannot Long This !!! situation+next targets.Given that the price has reached the top of the megaphone pattern and a negative signal (regular bearish divergence) has emerged, we can expect the price to decline from here to the points indicated on the chart. ✨We spend hours finding potential opportunities and writing useful ideas, we would be happy if you support us. Best regards CobraVanguard.💚 _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ✅Thank you, and for more ideas, hit ❤️Like❤️ and 🌟Follow🌟! ⚠️Things can change... The markets are always changing and even with all these signals, the market changes tend to be strong and fast!!
Short
by CobraVanguard
3
DreamAnalysis | Technical Analysis Dow Theory EP02📚 Welcome to the Educational Content Section of Our Channel: Technical Analysis Training 📚 Recap of the Previous Session: In the previous session, we explained the first two principles of Dow Theory. Make sure to review and study them, and if you have any questions, feel free to reach out to us in the comments. 📖 Today’s Focus: Principles 3 & 4 of Dow Theory Now, let’s dive into Principles 3 and 4 of Dow Theory and explore them together. 🎨 What is Technical Analysis? Let’s talk a bit about technical analysis and patterns in life. Technical analysis is not a science; rather, it is an art. Therefore, there is no right or wrong in art. Instead, we apply rules we have created through experience in this lawless market. 📑 Principles of Dow Theory : 1 - The Averages Discount Everything (Not applicable to crypto) 2 - The Market Has Three Trends 3 - Trends Have Three Phases 4 - Trend Continues Until a Reversal is Confirmed 5 - The Averages Must Confirm Each Other 6 - Volume Confirms the Trend 📊 Principle 3: Three Phases in Every Trend According to Dow Theory, each major market trend is divided into three distinct phases: 1️⃣ Accumulation In this phase, large and informed investors begin buying or selling assets at favorable prices. These groups consist of individuals and institutions with significant knowledge and financial resources, often acting contrary to the majority of the market. While most market participants may not yet notice price changes, these informed investors are positioning themselves to benefit from future market movements. 2️⃣ Public Participation At this stage, most investors start recognizing the trend and begin participating in the market. The trend accelerates as public attention increases, and new capital flows in. This phase is typically characterized by a sharp rise in prices during a bull market or a sharp decline during a bear market. 3️⃣ Excess or Fear In this phase, participants jump into trades out of fear of missing out on profits or due to panic over further losses. This phase often signals the nearing end of the major trend and is usually followed by a reversal or change in trend direction. 💡 Principle 4: Different Indexes Must Confirm Each Other This principle states that the overall market trend must be confirmed by various indexes. It means that a bullish or bearish market trend can only be considered valid if other key indexes are moving in the same direction. 🔍 Example: To confirm a bullish market in a country like India, all major indexes, such as Nifty, Sensex, Nifty Midcap, and Nifty Smallcap, should be moving upward. 📝 Important Note: These principles were developed over a century ago, and it is natural that with today's diverse financial markets, there are varying views on their application. ⚠️ Please remember that these lessons represent our personal view of the market and should not be considered financial advice for investment.
Education
by DreamAnalysis
1
Honestly, I don't feel like explaining, the chart says it all !!As you can see, MATIC has created an ascending Triangle and is also located in the Broadening wedge . , which means that if it breaks, we expect the price to reach the top of the Broadening wedge . ✨We spend hours finding potential opportunities and writing useful ideas, we would be happy if you support us. Best regards CobraVanguard.💚 _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ✅Thank you, and for more ideas, hit ❤️Like❤️ and 🌟Follow🌟! ⚠️Things can change... The markets are always changing and even with all these signals, the market changes tend to be strong and fast!!
MLong
by CobraVanguard
2
ETH: This May Be Your Last Chance Before Exploding to UpsideAs I mentioned in the previous analysis, Ethereum can experience significant growth after breaking out of the wedge, which indeed happened. Now, we can set the target at 2800. If this zone is broken, the price can reach the top of the megaphone pattern. Previous Analysis ✨We spend hours finding potential opportunities and writing useful ideas, we would be happy if you support us. Best regards CobraVanguard.💚 _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ ✅Thank you, and for more ideas, hit ❤️Like❤️ and 🌟Follow🌟! ⚠️Things can change... The markets are always changing and even with all these signals, the market changes tend to be strong and fast!!
COINBASE:ETHUSDLong
by CobraVanguard
7
wabagHere's a detailed explanation of the chart with added emojis: 1. **Breakout Level**: 📊 **Breakout Level** (marked in yellow) represents a key **resistance** point around ₹1,421.90. - 📉 In the past, the stock price repeatedly tried to cross this level but was pushed back down each time, showing that sellers were strong at this point. - 🚀 **Breakout** occurs when the stock **closes above this resistance** with strong momentum, which often signals the start of a bullish trend. This is a key level traders watch to determine if a stock is ready to rise further. - 📏 The resistance level is like a ceiling the price couldn't break before, but once it does with strong conviction, the price may start moving upwards faster. 2. **Up Arrows** (📈) at Support Points: 🔼 These arrows mark where the stock finds **support** from the market. - 🔍 Each time the price touches the **ascending trendline** (the purple diagonal line), it bounces upward, showing that buyers are stepping in at higher levels. This signals that investors are confident in the stock and willing to pay more each time the price drops to this line. - 💪 This forms an **upward trend** over time. The higher lows indicate that the stock is gaining strength as demand continues to increase. The price bouncing off this trendline multiple times adds to the idea that the stock is forming a **bullish pattern**. 3. **Down Arrows** (📉) at Resistance Points: 🔽 These arrows highlight moments where the stock price hits a **resistance point** (the yellow line) and can't move higher. - 🔄 The stock was **rejected** at this level several times in the past, creating a **consolidation phase** between the trendline and resistance. This pattern shows indecision in the market—buyers are willing to step in at lower levels, but sellers are still in control near the resistance. - This series of price rejections emphasizes how hard it was for the stock to **break above** the ₹1,421.90 level before, making the eventual breakout even more significant. 4. **Hammer Candle** (🔨): 🔨 **Hammer Candle** forms just before the breakout, signaling a **potential trend reversal** from bearish to bullish. - 📉 Initially, the price falls, but buyers step in strongly by the end of the session, pushing the price back up to near where it opened. This creates a hammer shape: a small body with a long lower wick. - 🛑 Hammer candles typically appear at the bottom of a **downtrend** and indicate that the sellers' momentum is weakening. The long lower shadow shows that buyers stepped in aggressively, preventing the price from falling further. - 📈 This hammer formed near the support line (purple trendline) is a powerful bullish signal that suggests the market is preparing for a **reversal**. Traders often see this as a sign that a new **uptrend** is starting. 5. **Bullish Candle** (📊): 🟩 The large **bullish candle** following the hammer is a classic sign of a **breakout**. - 🚀 The stock has broken above its previous resistance level of ₹1,421.90 and closed significantly higher at ₹1,518.70. - 📈 The strong green candle indicates that there is a surge in buying interest, and the bulls are now in control. This large movement up suggests that many traders are entering the market at once, fueling the price rise. - 🔥 This is often considered a **breakout confirmation**, especially when the price closes well above the resistance level. It is a clear sign of upward momentum. 6. **Volume Spike** (📊🔊): 🔊 The **volume spike** shown in the green bar at the bottom represents a huge increase in **trading volume**. - 📈 Volume is crucial in confirming the breakout. A breakout without volume might be a false signal, but when volume surges (like it does here), it shows that a significant number of participants are involved in the move. - 🏦 **High volume** means many traders and investors are buying into this move, which suggests that the breakout is likely to continue with strength. ### Summary: 📊 The stock was consolidating between an **ascending trendline** (purple line) and **resistance level** (yellow line). 🔨 The hammer candle signaled a **reversal** was coming, and the breakout was confirmed by a large **bullish candle** supported by a **volume surge**. 🚀 The stock is now in a strong **bullish phase**, with potential for further upward momentum after breaking past its key resistance level. The combination of the breakout, hammer candle, volume increase, and bullish price action suggests a positive outlook for this stock. no reommendation for buy and sell
NSE:WABAGLong
by investigationofchart
DreamAnalysis | Understanding Liquidity Pools in DeFi EP02✨ Welcome to the second DeFi educational content! 🔄 Active vs Passive Income Recap In the previous session, we discussed the concept of active and passive income. To briefly explain, active income refers to the income one must work for every day, while passive income does not require daily effort, and one can still earn money over weeks or even months without doing anything special. If you want to read more about this concept in detail, you can check out the first part of DeFi education in this channel. 📅 Introduction to Liquidity Pools Today, I want to dive into the concept of liquidity pools for tokens and how these tokens generate income. First, I’ll explain what a liquidity pool is and how it has evolved from the past to the present. ✅ From Barter to Currency In ancient times, before the invention of money, people bartered goods with each other. For example, they would exchange wheat for meat. But there were days when no one had meat available, and those who needed it couldn't find what they were looking for. After the creation of governments, with rationing and the supply of necessary goods, this problem was somewhat solved, as any time a commodity became scarce in the city, it was quickly brought to the market so people could obtain it. 🏛 The Role of Banks and Exchanges With the establishment of banks and exchanges, people shifted from bartering goods to exchanging currencies, but the issue of availability still exists. Sometimes, banks or exchanges don’t have the currency a person is looking for. For instance, someone who wants to exchange their dollars for euros can likely do so in most exchanges because euros and dollars have high liquidity. However, finding an exchange that will give Turkish Lira in return for dollars may be harder because Lira doesn’t have high liquidity in most countries, and the bulk of its liquidity is in Turkey. 💵 Liquidity in the Crypto Space In the crypto space, there are also many liquidity pools. For example, Binance is the largest cryptocurrency exchange because 1) it has a large user base, and 2) it has large liquidity pools. This means that the market depth on this exchange is high, allowing users to buy and sell their coins and tokens without causing price fluctuations. 📊Trading without Price Slippage For instance, if someone wants to sell $1,000 of Bitcoin at a price of $60,000, and someone else wants to buy the same amount at the same price, the transaction can happen without moving the price, and the exchange earns a fee from both parties. 🕯 Price Fluctuations with Lower Liquidity In another scenario, someone wants to buy $1,000 at $60,000, but the second person is only willing to sell $900 at that price. In this case, the price moves upward, and now the buyer purchases $900 at $60,000 and the remaining $100 at $60,001. If another seller offers $100 at this price, the transaction happens, and the price moves slightly higher. So now we understand how price changes and how exchanges earn fees. 🌱 DeFi’s Liquidity Pools and Token Swaps This also exists in DeFi. For example, when you exchange Ethereum for Bitcoin through the Uniswap platform, you are essentially trading, and Uniswap needs to have Bitcoin in its reserve to give you in exchange for your Ethereum, just like Binance does. But there is a significant difference between Binance and Uniswap. 🟢 As mentioned earlier, Binance creates liquidity pools, and therefore it charges fees for your trades. However, on Uniswap, users themselves can create liquidity pools and earn transaction fees. 🔔 For example, a user can deposit their Bitcoin and Ethereum into this platform and earn fees from the trades of other users. So if someone wants to exchange Ethereum for Bitcoin, they can give their Ethereum to the user who created the liquidity, and the liquidity provider will give them Bitcoin and earn the transaction fee. All these processes are automated, which is why the user who provides liquidity earns passive income. 🤝 I’ll stop here so that the explanations don’t get too lengthy, and in the next part, I’ll explain more about liquidity pools. ❌Disclaimer The information provided in this lesson is for educational purposes only and should not be considered financial advice. Liquidity pools and DeFi investments involve significant risks, including potential loss of capital. Please conduct thorough research and consult with a financial advisor before participating in any DeFi platforms. The channel and its creators are not responsible for any financial losses incurred.
by DreamAnalysis
DreamAnalysis | What Is DeFi? EP01✨ Welcome to the first DeFi educational content! 📅 Today, we have prepared the first DeFi lesson for you, and we want to present this sweet topic completely and comprehensively in this channel. In this lesson, we want to cover the basic and fundamental concepts of DeFi, review DeFi in general, and assess the risks and how to generate income from this space. 🧩 To better understand DeFi, it is better to first become familiar with the concept of "Passive Income." The income we have in life is divided into two types: active and passive. ⚡️ Active Income Active income means the income that a person must earn every day to receive a salary in exchange for the work they do. For example, an employee who earns $10 per hour has active income because they only earn money as long as they work, and if they don’t work for an hour, they won’t receive that hour's wage. In the crypto market, active income can be exemplified by futures trading. Although you don’t get paid hourly, the money you earn depends on market conditions. However, if you stay away from the market for a week and don’t make any trades, you won’t make any profit. Most jobs and most of the population have active income. 🔄 Passive income Passive income means the income that a person doesn’t need to work every day and hour to receive in return. For example, if a person deposits $100,000 in the bank and the bank gives them a 5% annual interest, after a year, they will have $105,000, and they didn’t do anything for the $5,000 they earned. Of course, we must consider that this person took on a risk and put their money at risk because the bank might go bankrupt, and all their capital could be lost. In the crypto space, DeFi acts as a passive income where the individual earns profit not based on time spent but by taking on risks. 🌱 Now that we understand the difference between active and passive income, we will better understand the concept of DeFi. 🔑 What is DeFi? DeFi (Decentralized Finance) in English means "decentralized finance." In fact, the DeFi space is a kind of decentralized bank where you can do things like lending, borrowing, creating liquidity, staking, etc., completely decentralized. Given its decentralized nature, all the money exchanged in between is moved by the platform's users, and the profit and loss of this process are also in the hands of the users. 💵 For example, you can create liquidity in decentralized exchanges and receive transaction fees when other users make trades, or you can lend the money you have and earn interest in return for lending it to another user. All your contracts and transactions are recorded on the blockchain and can be tracked. In future lessons, we will examine all DeFi income generation methods and cover all methods step by step and practically. ✅ So far, we have mentioned the good parts and advantages of DeFi, such as DeFi being a passive income that doesn’t require daily work and is completely decentralized. But there are also risks that may keep many people away from this space. Let’s go over the risks of the DeFi space. ❗️ DeFi Risks Let’s move on to the risks you must accept when entering the DeFi space. First, let’s start with the market trend. In DeFi, we buy various coins based on their use cases, and it is possible that these coins may lose their value over time and be worth less than when they were purchased. So, if the market is bearish, the likelihood of losing money in the DeFi space increases significantly. Of course, in future lessons and when we reach advanced training, we will teach you how to profit in a bear market. However, if the market is bearish, the chances of losing money increase. 🔔 The next risk you must accept when entering DeFi is related to device and wallet security. There are always hackers trying to seize your assets in any way possible, and since DeFi is completely decentralized, there is no way to pursue it if your wallet gets hacked. So, by entering DeFi, you must also consider the possibility of being hacked, in which case all the capital you have invested will be lost. 📍 The last risk is the platforms and websites to which we connect our wallets. By connecting your wallet and signing digitally, which is stored on the blockchain, the platform in question will have limited access to your wallet. If you sign the wrong contract or the site gets hacked, the assets in your wallet may be lost. 📚 These three risks are the most important in DeFi. But how can we reduce and control these risks? First of all, you must manage your capital. Given the risks of DeFi, the maximum amount of capital that I think can be invested in DeFi is 10% of your crypto capital. For example, if you have $100,000 in the market, invest a maximum of $10,000 in DeFi so that if your investment is lost, only 10% of your total capital is destroyed. The second solution is that you can increase security by creating several wallets and distributing the 10% of the capital you want to enter the market between them so that if one of the wallets is hacked, only a small part of your capital is lost. 🤝 I hope this lesson has helped you. DeFi training will be provided every Saturday so you can learn this skill without any cost. Next week, we will have training on the initial steps and prerequisites for entering DeFi, so I recommend continuing with us. ❌ Disclaimer The information provided in this lesson is for educational purposes only and should not be considered financial advice. DeFi is a highly volatile and risky market. It is essential to conduct thorough research and consult with a financial advisor before making any investment decisions. The channel and its creators are not responsible for any financial losses incurred.
by DreamAnalysis