Today’s era is the digital era. There are multiple sources of earning money through bitcoin, such as accepting bitcoin as a payment method by integrating into your eCommerce website if you are selling online products, selling products by larger organizations, mining, investing, and trading bitcoins.

But there are only two most popular ways convenient for everyone, which means these two ways are learnable. These two ways are investing and trading, but people are confused with these two terms. They want to learn where to go with investing or trading.

So in this article, we will discuss the basic terms that will help you choose the proper earning method that is suitable for you. We will discuss all the things, and it also depends upon you. If you have trading skills, then trading is best for you and if you have investing skills, investing is beneficial for you. So without wasting time, let’s choose the best-earning method.

What is trading?

Before going further, you must learn the basic terms like what is trading and investing. Trading is short term holding of bitcoin. In simple words, trading means buying bitcoin at the market price, or if you think this is the best price for buying and selling when the market price of bitcoin increases, then the price at which you purchased. So trading is elementary in theory but very risky in practical.

What is investing?

Investing is the opposite of trading because you have to hold the bitcoins for more than five years. It would be best to have patience here, and many people cannot wait for a long time. Investing is the most secure and best way to earn money. Here you need a skill that is the skill of patience. If you can wait for more than five years, you will earn a considerable profit, and if time is more, the return will also be more. It is not a risky way to earn money through bitcoin. You can start investing if you want to earn huge money safely.

Comparison 

There are the following terms in trading and investing, and it suits different people differently, so choose wisely:-

  • Trading is a hazardous form of earning money, and if you are a risk-taker, you can go with trading. Investing is a long-term process, so it is not risky. If you do not want to take risks, then you can go with investing.
  • If you cannot wait for years and want instant profit, you can go with trading and if you have the patience or can wait for years, then choose to invest.
  • Bitcoin is a deflation currency that means the price of bitcoin will increase over time, so trading will not give you enough profit. On the other hand, if you want huge profits or are serious about multiplying your money, you can invest.
  • Skills required for trading and investing:- If you want to trade bitcoin, i.e., earn money through buying and selling in the short term, you have to practice with simulators without spending real money and learn how trading works. First, you have to learn how to trade, understand the technology and bitcoin, market research skills, and be active. Many beginners initially lose their money because they heard that it is possible to be a millionaire through trading. In bitcoin investing, you need one skill that is patience. Once you buy, forget it for 5 to 10 years whether the price increased or decreased. Do not check until the time is over, and after that period, you will see a miracle because bitcoin is a deflation currency, and the price of bitcoin will continue to increase in the future.
  • Suppose you are doing intraday trading that means you have to sell bitcoin before closing the market, and suppose you purchase bitcoin at the market price of $100. Before closing the market, the price is $90, which means you must sell the bitcoin at the market price, i.e., $90. Here you lose $10. It is just an example, beginners trade high amounts and lose high amounts, and then said trading is just a waste of time and money. To practice and learn to trade, you need to consider the bitcoin wallet qualities you must look for.