Many people find it challenging to navigate the crypto world at first. They hear buzzwords like HODL, staking, mining, broker, digital wallets, smart contracts, and the likes, but have no clue what they are.
Investing in cryptocurrency could be as lucrative as it’s risky. Hence it would be best if you got the basics of the coin market correctly as a starter. If not, going on investing would be similar to placing a bet based on uninformed world cup predictions.
Crypto investing occurs in different forms. These might involve buying a digital coin directly or investing in companies and crypto funds.
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How to Invest in Cryptocurrency Now
Cryptocurrencies are pretty accessible lately with the presence of several online exchange outlets. If you’re trying to get into the digital market, you must make your findings just as you would if it were other assets. As a first-timer, here are things you need to know before starting.
1. Choose a cryptocurrency
If you would like to be a stakeholder in a company, you’d do some underground diggings about their stocks. The same applies here. There are tons of digital currencies out there. So you must find one (or several others) with desirable characteristics that pique your interest.
Some cryptocurrencies are piloted based on fraudulent practices. An example is a pump-and-dump scheme. Things like that sometimes make it difficult to be entrusted with a coin. Nevertheless, a thorough analysis is key to not falling victim to these scams.
2. Pick a crypto exchange or broker
To purchase cryptocurrencies, you need a broker or a crypto exchange. Although both are similar in many ways, they are slight differences.
Cryptocurrency exchanges are platforms where crypto transactions take place. They have an online presence with relatively low fees and sometimes clumsy interfaces. They provide you with performance charts and standard trade options. For a crypto newbie, this could be a little confusing. Popular examples are Coinbase, Binance, and Gemini.
On the other hand, brokers offer simplified processes for purchasing digital currency. Some are free, while others charge higher fees than exchanges. However, those that claim to be free often engage in shady activities, selling the information of clients out to larger brokerages. Hence you should be security conscious and find trusted brokers for your crypto transactions.
These digital media also have added advantages. They ease online transactions involving crypto and fiat payments. A few are affiliates to other platforms. For example, if you’re a soccer fan, you can stake your bet by paying from your wallet and checking in with world cup expert picks.
3. Create a verified account
After you’ve decided on a broker or exchange, you can go on to create and verify your account. The verification process mainly involves you providing details about your identity. Depending on the platform, you need personal documents like your international passport, driver’s license, national identity card, etc.
After your identity has been confirmed, you can then engage in transactions on the platform.
4. Decide on the amount to invest and make a deposit
Before trading on most exchanges, you must have money in your wallet. But first, you need to decide on the amount you’re willing to start with. This cash should be one you can afford. And borrowing is ill-advised, especially if it’s a large sum.
Once you have your money, make your deposit. You can do this via your bank account by linking it to the wallet. It might take a few days or hours, depending on the exchange or broker, before you can use your deposited money.
5. Carve out a management plan for your investments
Unlike other forms of investment, cryptocurrency is unique. The market is one propelled by volatilities. Sometimes, these could play out in your favor or not. To prevent an early exit from the marketplace, you need to develop a feasible management strategy for your investment, like the one you could develop having your world cup picks.
Remember, crypto investment is long-term. And the virtues of patience and consistency are essential to making it big. While there’s nothing guaranteed, you need to play it wise to be on the safe end, come what may. While you can make a lot of money from investing in crypto, you can also make a fortune from sports betting.