Home Crypto Step-by-Step Guide to Investing in Crypto

Step-by-Step Guide to Investing in Crypto

The crypto market experienced a massive bull cycle in 2020, thanks to Bitcoin’s bull run, which broke all kinds of records, including an all-time high of over $60,000 in April 2021. Consequently, there was a surge in demand for cryptocurrencies, as other virtual currencies followed the same trend and entered a bull market phase. As a result, the number of trading platforms increased with hundreds of different trading sites on the crypto market and a record number of new cryptocurrencies. The current number is around 20,000.

If you’re new to the world of crypto, you might feel overwhelmed by the options in front of you – everything from crypto trading sites to new cryptocurrencies makes it more difficult for you to start trading. This is why in this article, we have compiled a list of three steps that will help you learn about investing in cryptocurrencies as a beginner.

Blockchain Technology

Without the innovative blockchain technology, Bitcoin would not have been able to achieve spectacular success on the crypto market and to operate as it does without intermediaries or control by any financial organization.

The more you know about blockchain technology, the easier it will be for you to make the right decisions about your portfolio of cryptocurrencies. Firstly, blockchain technology was designed as a distributed decentralized ledger that makes it virtually impossible for anyone to control the network, alter the data or tamper with its operations.

In the blockchain network, each transaction is recorded, added to a block of transactions, and distributed across a cluster of computers worldwide. Each computer has the same copy of the blockchain network, and as it is a peer-to-peer-based network, the data about the transactions are completely visible to everyone.

This also makes it easier for the participants to keep track of every process, and also, the transactions are completed quickly compared to fiat currencies, with low processing fees. Although each blockchain network might be a bit different, crypto projects can have differences in its operations, verifications of crypto transactions, or other unique innovations; they are all based on the original Bitcoin’s blockchain technology.

Online Exchange Platform

The rise of cryptocurrencies is based on the decentralized crypto market, which consists of different online trading platforms. Namely, online trading sites allow you to trade cryptocurrencies and fiat currencies from desktop and mobile devices. The only difficult step is to pick the right one for your financial goals and budget.

For example, Tesla Coin is an AI-based trading site that utilizes its crypto token, Tesla coin, to complete the technical aspects of trading automatically. There is an option to access a demo account, see how trading functions on the platform, and an integrated wallet management system allowing you to trade on the go as this is a mobile-optimized trading system.

The Artificial Intelligence technology has become an important aspect of many trading sites because it is able to derive valuable insights from a huge amount of data, and in the future, we expect it to become more prevalent on many trading sites.

Crypto Wallet

A crypto wallet is important for every user regardless of their experience or chosen trading platform. It represents a safe storage option for crypto assets and a secure medium for online trading. You can make payments, receive crypto funds, and place orders on trading sites.

There are four different wallets, each known for its limits and advantages. The crypto wallet can be a cold storage option, desktop, mobile or online wallet. They all have a private key used to virtually sign off transactions and a public key, a virtual address required for you to receive crypto payments.

If you choose to use a mobile crypto wallet, although it is considered a bit safer than a web wallet, it is still vulnerable to viruses and cyber-attacks. Otherwise, it is very convenient to use and allows you to keep up with your investments on the go.

The web wallet, as we mentioned, is not considered as safe as the others, but it is easily accessible and stores your crypto assets on a third-party server you don’t control. So, you can access your wallet from any web browser.

A desktop wallet is deemed safe and great for use and online trading, offering you complete control of your crypto assets. Regardless of the crypto wallet, you choose for trading, and it’s advisable to have a hardware wallet (cold storage option) to back up your crypto funds and store them safely offline.

Summary

In conclusion, to start trading, you need to do your research and find a reliable crypto trading site with an appropriate license that allows you to trade from desktop and mobile devices. It’s even more important to have a good financial plan which will lead you toward better financial decisions. Lastly, make sure to have both hot and cold storage options for your crypto assets.

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