The Official Dummy’s Guide to Trading the Binance Exchange 

binance-tutorial-guide-exchange

Today we’re going to review one of the biggest and fastest growing cryptocurrency exchanges to date, Binance. In fact, it’s been able to reach the 10th place rank of all exchanges with regard to cryptocurrency trading volume in just under 5 months. With cryptocurrency becoming more and more popular by the day, Binance was able to ride out this trend by offering an excellent user experience to traders who want to start entering the market for the first time. 

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So Why Binance?

Sure, there are so many other cryptocurrency exchanges out there, however why does  Binance seem to have almost a cult like following, especially for novice traders. At the rate it’s currently moving, Binance may even reach the number 1 spot as the top cryptocurrency exchange in the world by the end of 2018.

This exchange  offers a wide range of altcoin trading aside from the usual Bitcoin and Ethereum pairs. In fact, Binance is already in the same league as some of the biggest players like Bittrex and Poloniex who have been in this space for well over 4 years. 

It comes down to a few different aspects…

  • Marketing, marketing, and more marketing (they have a great team and a great referral program)
  • Fees – fees are as low as 0.001% if you use their BNB coin.
  • Their trading platform is easy to use for beginners. They offer both a basic
    platform as well as an advanced chart for more experienced traders.
  • Their support is very responsive.

How Do I Start Trading on Binance?

To trade on Binance, you simply have to open an account, fund it, configure a few settings, and your off to the races. Check out my step-by-step guide on getting started below.

1. Register for an Account

Easy right? Not exactly. Go to Binance , simply click the Register button and fill  all that necessary information you’re used to filling out on these cumbersome applications. Don’t worry it only takes a few minutes.

Once you’ve filled out everything,  submit your form and wait for a confirmation email that will be sent to your email. Follow the steps in the confirmation email, click the confirmation link, and you’ll redirected to your very own Binance dashboard.

2. Set Up a 2 Factor Authentication

This is one of the most important steps in the process as it’ll give you that extra padding of security you’ll need so that no one can easily hack  your account. Once logged in, you’ll receive a message prompting you to set up your 2 Factor Authentication.  You’ll be instructed to download the Google Authenticator app to your smartphone as well. Once that’s done, you’re ready to fully login. Just follow the instructions given in the message prompt and you’re good to go. Fort know security at your fingertips!

3. Verify Your Account & Setup Your Deposit

With a basic Binance account the withdrawal limit is 2 bitcoin every 24 hours. With a verified account, where you’ll need to scan your photo ID,  you can withdraw 100 bitcoin every 24 hours. Quite the difference huh?

If you’re planning to be the next crypto millionaire, then you just might want to verify your account. Either way….it’s good get it done.

While you’re waiting for your photo verification to be approved, you can still trade, so let’s get to it. Got to your dashboard and on the top right hand side you’ll see a funds option above the menu bar. Hover on that portion and a drop down should appear. Click on the Deposits/Withdrawals option. It will bring you to the page where you can deposit your funds.

deposit-funds-into-binance
click to enlarge

4. Choose Your Crypto Coin

You have the choice to deposit various types of coins, which you’ll use to trade later. Choose which one you’ll want trade with and then press the deposit button. Upon doing that, you’ll be appointed a code for your dedicated wallet (it’s a mix of numbers and letters). This is the address that you’ll use to deposit your funds into your Binance account.

Take note that the wallet address differs per coin, so it’s better to stick to one coin wallet which can be used as your main deposit wallet. Once that’s done, transfer your coins from your other wallet (via Coinbase, LocalBitcoin, Gemini, etc. Take a look at our exchange page for options) to this new coin address.

funds-into-binance-review
click to enlarge

5. Finally the Day is Upon Us! Start Trading on Binance.

Once you’re done with all that verifying, form filling, and wallet transfers, you can finally start trading like the big boys! The first step is to hover over the Exchange option on the menu (top left) and click the Basic Exchange option. From there, you’ll see a list of coin pairs that you can trade.

Take note that you’ll be betting the value of one coin versus another, much like how you do in Forex (e.g. Bitcoin against Ethereum is ETH/BTC). If you know the coin pair that you want to trade already, you may simply search for it in the search bar so that you can see it right away.

PRO TIP:  I highly advise you check out our technical analysis section of the site to discover the basics of fundamental trading, unless you just want to roll the dice and invest in what your friend told you last week.

6. Tips On Trading Execution

So, let’s use the example of Bitcoin and Ethereum. In the exchange, click on the ETH/BTC pair to buy/sell it. When you click on the pair, you’ll be brought to the order book where you can see details on the pair such as volume, last price, high 24 price, low 24 hour price, and a trading chart.

buy-and-sell-on-binance

When you want to trade, there are a few features you’ll need to take note of, most importantly the Buy and Sell Limit boxes. The Buy or Sell Limit is a feature that allows you to choose what price you want to trade the pair with. Once the pair hits your Limit price, then it’ll open the trade automatically.

Say you’re trading the BTC/ETH pair. When you set a buy limit order for 0.02 ETH  (converting BTC to ETH) for 0.01 BTC and your order is filled, you’ll have 0.02 ETH at the buy price of 0.01 BTC. This may be hard to grasp at first, but believe me, once you do it a few times, you’ll won’t ever forget it.

For more detailed information about this process, check out this video

Also take note of the Stop Loss, which is a function that allows you to close a trade once the pair hits a certain price (usually below your buy in price). This lets you control how much of a loss you will incur in the event that your trade doesn’t go too well. This is a very significant feature in trading because it allows you to manage your funds wisely and never lose more than a certain percentage you set up.

What is the Binance Coin?

The Binance coin, also known as the BNB, is a special cryptocurrency that was specifically made by Binance. This coin is the preferred method of paying for fees incurred while trading on the platform. The fees would include the buying fee, selling fee, and the withdrawal fees that you have to pay while using the exchange.  

binance-coinOne of the great things about using the BNB coin is that you will get a 50% discount for your transactions in the first year of your trading in the exchange. This is to entice more people to use the coins and participate in the exchange. In the second year, you’ll receive a 25% discount, a 12.5% discount in the third year, and a 6.25% discount in the fourth year.

Another great feature of the BNB is that it can be used along with the Binance Launchpad to allow you to invest in ICO’s through Binance. So, if there is a particular ICO on a new coin, then Binance will allow you to have first dibs to invest in the ICO using the BNB. Pretty cool right? One of the future plans of Binance is to use 20% of its total profits to buy BNB again from the market.

Pick up some BNB today and start trading, but remember, only put money in that you can afford to lose. Never play with your “bill money”, ok? Good luck young grasshoppa!

 

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