If you are figuring out how to invest/trade into cryptos like Bitcoin, Dogecoin, Ethereum, etc then being a novice this domain can be confusing at first. But, trust me it’s pretty simple to learn the ropes. One can start investing/trading in cryptocurrency by following a few steps which we shall be discussing in this article. Remember: investing here is quite speculative, and your capital might be at risk. Below is an exhibit of the crypto market from 2020 to 2027 (expected figures) about its market share.
1. Choose A Broker Or Crypto Exchange
A cryptocurrency exchange is a platform where traders meet to buy/sell cryptocurrencies. Exchanges have complex interfaces with multiple trade types and advanced performance charts, but they charge low fees relatively. A few examples of cryptocurrency exchanges are WazirX, CoinDCX, Zebpay, and UnoCoin.
Cryptocurrency brokers throw the complexity to purchase crypto, by offering easy-to-use interfaces that interact with crypto exchanges. They charge fees on a higher side than exchanges. While they’re truly convenient but one needs to be careful with them because of restrictions while moving the cryptocurrency holdings off the platform. With some, for example, you cannot transfer your crypto holdings out of your account.
Read: Let’s Understand Crypto In A Layman Language
2. Create Digi Account
Once the decision is made on a cryptocurrency broker or exchange, you can sign in to open a new digital crypto account. After that, the identity needs to be verified on the platform by depositing a few documents and photographs. One may not be able to trade cryptocurrency until he completes the entire verification process.
3. Deposit Amount To Buy Coins
To trade into crypto, one needs to make sure one has funds in your account. The bank account or a debit card needs to be linked to the crypto Digi wallet so that the funds can be easily transferred as per requirements. Once the money is there in the account, the user is ready to place his first cryptocurrency online order.
4. Place Cryptocurrency Order
A Plethora of cryptocurrencies is available for purchasing from Bitcoin and Ethereum to more obscure cryptos like Theta Fuel or Holo. When one decides on which cryptocurrency coin to buy, he can enter its ticker symbol – Bitcoin, which is BTC – and the number of coins he would like to purchase. One can also buy fractional shares of such cryptocurrency, which allows buying a share of high-priced tokens like Bitcoin or Ethereum that could otherwise take thousands of rupees to buy.
5. Storage Selection
Every coin has two sides and so do these. If an investor is taking home luring profits which is a speculative asset in such case even risk is on the higher side. As we know few countries have full legal protection towards cryptos while few countries are neutral or have also banned its trading. In such a scenario if anything goes wrong then the investor cannot legally claim his crypto wallet. One can lose the investment if he forgets or loses the codes to access his account. Hence, it is important to have a secure storage place for cryptocurrencies. As noted above, if one is buying cryptocurrency via a broker, he may have no choice but to store his coins, but if he is purchasing via an exchange, he can leave his coins on the exchange itself. One can also transfer it off the exchange to a hot or cold wallet.
Alternative Ways To Buy Cryptocurrency
Although it is known that cryptos are highly volatile and risky investments, still I am being reported by many. It is also a form of excitement for many as it is a new concept of trading with huge scaling profits. Apart from brokers and exchange, one can also indirectly invest in Bitcoin and other cryptocurrencies:
1. Wait For Crypto Exchange-Traded Funds
ETFs are quite popular investments that shall allow a buying exposure to many individual holdings in one fell swoop, which means they shall be providing immediate diversification with less risky investments. There is a huge appetite for such crypto ETFs, which allows investment in diverse cryptocurrencies at once.
2. Invest In Companies Associated With Cryptocurrency
If one wants exposure to the cryptocurrency market, being a first-time investor with less risk-taking ability one can buy shares in companies that use or own cryptocurrencies and the blockchain that makes them powerful. Example- Nvidia is a technology that designs graphic processing units used to mine cryptocurrency. Another example could be Square which is a payment services provider for small businesses which purchases Bitcoin and allows people to buy, sell and store cryptocurrency.
Read: Cybersecurity Timeline and Trends You Should Know Before Planning for 2023
