Money replaced the trade by barter system as a means of exchange for goods and services. People paid for and sold goods and services by tendering and receiving money. The value of money is relative from one country to another, and different countries have different currencies. Currencies have always been physical until Bitcoin; the first cryptocurrency was introduced in 2009.
Since the creation of the cryptocurrency market, over 13,000 cryptocurrencies have been introduced. Examples of other cryptocurrencies include Ethereum, Tron, Dogecoin, Litecoin, Ripple, Tether, and Cardano. The value of these currencies is controlled by the number of people investing (or not investing) in them. This makes it volatile, and many people now trade cryptocurrency to make a profit.
However, as a beginner to crypto investment, you have to be guided on the pros and cons by experts like Paybis. Here, we provide you with everything you need to know about crypto investment. If you follow through on this discussion, you won’t miss a step in your investment journey.
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How Does Cryptocurrency Work?
Cryptocurrency is a digital asset, and transactions are securely recorded by using an online log. This log details transactions in computers all over the world using strong cryptography. Different computers record this transaction and store the transaction details as a receipt whenever a crypto transaction occurs.
Many companies have created their digital currency allowing people to pay for the goods and services that they offer. These digital currencies are known as tokens. To get these tokens, you will have to exchange them with your hard currency. The management system of cryptocurrencies makes it impossible for any government to have control over it.
The computers used to record and store transaction details make up a safe and secure system called Blockchain. This system protects currencies and ensures transparency before, during, and after a contract.
How Can I Buy or Sell Cryptocurrency?
As a newbie in the cryptocurrency market, learning to buy, keep, and sell cryptocurrencies is a must. It might prove difficult initially, but you can follow these easy steps to selling or buying cryptocurrency;
1. Find a crypto exchange platform or broker
The first step to getting or letting off crypto is finding a reliable platform with which you can do your exchange. On this platform, you can perform a direct exchange with relatively low transaction charges.
Buying or selling might be tricky if you are new to the trading world. These trading platforms usually have a user-friendly interface so that you can get along fast as a beginner.
Alternatively, you can find other people in the crypto world who also want to exchange cryptos. These people are called brokers, and they make the transaction easier. However, you should be careful, so you do not get dwindled.
2. Sign up with the exchange platform
These crypto exchange platforms are available on the web and have mobile applications. When you choose the broker or platform you want to exchange with, you have to sign up with them. After signing up, some platforms will require you to go through a verification process. This verification helps to prevent fraudulent practices and meet up with regulatory laws.
Without completing this verification, you will be unable to perform any transaction, or your transaction will be limited.
3. Make an initial deposit
After signing up on a crypto platform, individual wallets will be created for different cryptocurrencies like Bitcoin, Ethereum, Litecoin, etc. These wallets will be empty upon creation. Since you are buying cryptocurrency, you will need to deposit hard currency into your wallet.
4. Place a crypto order
When you make the deposit, you can convert your hard currency into its equivalent in any digital currency of your choice. It is time to make your first crypto order. There are many cryptos that you can purchase. You can read on cryptos with the potential for exponential growth. If you have settled for crypto that you want to purchase, enter the wallet for that crypto and buy. The process is pretty easy, and your order will be entered into the Blockchain.
5. Store the crypto
If you are buying cryptocurrency from a broker or platform, your tokens will be sent to your wallet. When you have received them, you will need to decide on where you want to keep them. You can leave them in the online wallet or send them to a cold wallet. Cold wallets are more secure because they are not connected to the internet and cannot be hacked, unlike online wallets.
If you are selling a cryptocurrency like Bitcoin, you can do this in two easy ways.
Exchange with your platform or broker to receive hard currency that can be withdrawn to your local bank.
Exchange with your platform or broker to receive another cryptocurrency like Ethereum or Litecoin. You can invest in cryptocurrency by storing tokens till they appreciate.
6. Is Cryptocurrency Worth Investing In?
There are several speculations and debates online and offline about whether or not it is safe to invest in cryptocurrency. Before delving into the cryptocurrency market, you must understand that the market’s volatility makes it risky and profitable. So, if you can bear the risk associated with the volatility, you can be a part of the blockchain revolution.
7. How to Start Investing in Crypto
Here are three ways that you can invest in cryptocurrency as a beginner.
Buy and hold any valuable cryptocurrencies: You can buy a cryptocurrency and leave them in your wallet until they mature or increase in value.
ETFs: Exchange-Traded Funds or ETFs allow you to invest in multiple cryptocurrencies at once, reducing the risk involved.
Investment companies: Another way to invest in cryptocurrency is to buy stocks from companies that have cryptocurrency tokens. PayPal and Nvidia are examples of companies that have digital tokens that you can buy and keep.
The cryptocurrency market is volatile and there is always a constant price swing. It has no sole proprietor, and the activities of investors determine the volatility. Anything – as little as a single tweet – can make the value of a cryptocurrency skyrocket or nosedive. So, as you enter the market, make sure that you tread with caution.