Here’s a laid-back overview of the three main ways to trade crypto—and when you might pick each one.

1. Spot Trading

Spot trading is the simplest: you buy or sell the actual coin at today’s market price, and you own it outright.

Use it when you’re in it for the long haul—hodling Bitcoin, Ethereum, or any altcoin you believe will grow over time.

Friendly tip: Stick to well-known exchanges, secure your account with two-factor authentication, and consider dollar-cost averaging (buying a bit each week) to smooth out those wild price swings.

2. Margin Trading

Here, you borrow extra funds to increase your buying power. For example, 5× leverage turns $1,000 into a $5,000 position.

Use it when you spot a strong short-term move and want to amplify gains.

Heads up: Leverage is a double-edged sword—your losses can exceed your initial stake. Always set a stop-loss, start small (2× or 3×), and never risk more than you can comfortably lose.

3. Futures Trading

Futures let you lock in a buy or sell price today for a contract that settles in the future—without owning the coin. You can go “long” if you expect prices to rise, or “short” if you expect them to fall.

Use it when you want to hedge an existing spot position, profit from bearish trends, or lock in a price for later.

Pro move: Watch the funding rate (periodic fees paid between longs and shorts) and monitor your margin level to dodge forced liquidations.

Quick crypto-trading hacks:

Risk first: Cap your exposure—never gamble more than you can afford to lose.

Stay curious: Read market updates, learn to interpret on-chain metrics, and test new ideas on demo platforms.

Keep records: Use a simple spreadsheet or portfolio-tracker app to log your trades, P&L, and margin calls.

Mix and match these styles based on your goals. Trade smart, manage your risks, and keep it fun! #TradingTypes101