Cryptocurrency is a new and foreign topic to many people. Even though it’s an emerging market that’s growing rapidly, it’s not the easiest to understand.
If you ask the average person about cryptocurrency and their thoughts on investing, most think it’s a scam or it’s too risky.
A lot of people I’ve asked are still trying to learn about it as well as how to invest. There really isn’t a set process like there is in traditional investing, it’s a lot of trial and error.
The data speaks for itself, a study from Triple-A shows that the global cryptocurrency ownership rates are only 3.9%. “As of 2021, we estimated global crypto ownership rates at an average of 3.9%, with over 300 million crypto users worldwide. And over 18,000 businesses are already accepting cryptocurrency payments”.
This means that there’s so much potential for other countries and users to adopt cryptocurrencies. Even Visa and Paypal are offering that users can use crypto as a payment method.
More and more demographics are looking to invest in Bitcoin and other currencies as a path to financial freedom, as a retirement strategy, or as a hedge against inflation.
Here’s an easy and unintimidating guide to getting started on your crypto investments in 3 steps.
In order to start investing in cryptocurrencies, you’ll need to sign up at an exchange that’s user-friendly and that has the coins that you want to invest in.
Every exchange has different coins listed so you may need to sign up for a few different ones depending on the coins you are looking to invest in.
The good news is that most or all exchanges have Bitcoin (BTC) which is the biggest cryptocurrency by market cap and most trusted amongst investors.
Here are some of the top-rated exchanges according to Nerdwallet:
After you sign up for an exchange, you’ll need to connect your bank account information, set up security verification, and choose which currency you’d like to invest in.
I would recommend researching coins and watching content on youtube, listening to podcasts, and reading articles to get a grasp of trending coins.
A list of good research websites is provided below. Please use your own discretion when investing in currencies and invest in coins that you believe in and have done your research on.
If in doubt contact financial advisors and be cautious about who else you take investment tips from.
Speaking of research, here are some great websites for researching various currencies and getting news on the space, they’ll help you stay on top of the latest prices and news:
A more complete list of all the best crypto platforms and what to use them for can be found in our article on Where to do Crypto Research: The Best Crypto Platforms.
You want to research the incentives for purchasing the token, what are the tokenomics of this cryptocurrency?
Tokenomics give insight into the use cases and supply and demand of a cryptocurrency project you are investigating. Understanding a cryptocurrency’s tokenomics should be central to your investment decisions in the crypto industry.
The most important step is to secure your cryptocurrency. Digital currency is decentralized, in other words, it isn’t backed by a traditional bank like Wells Fargo so you have to make sure you store your crypto securely.
It’s our responsibility to store our currency and it’s really important to write down your passwords and seed phrases and create a few extra copies in case you lose them, there is no way to retrieve your secret pass phrases so be cautious about that process.
Make sure you hide your passwords in a secure place and do not share them with anyone. You can then start to transfer your digital currency to wallets and store them for safety.
Here are some of the top wallets where you can secure your digital assets, please note the differences between hot and cold wallets.
Crypto Hot wallets are web, mobile, and desktop-based, which should be used for quick and easy access to make quick transactions. Hot wallets can still be prone to online attacks compared to cold wallets.
Crypto Cold wallets are offline, physical wallets that you should order directly from the provider’s website for security reasons.
This is highly recommended since you do not want to risk buying them on Amazon. If you purchase them from Amazon you risk someone having preemptively bugged the device for future hacking.
People who invest in large amounts of crypto most likely store it in a cold wallet because it’s the safest method and cold wallets are physical.
The only way they can get hacked is if someone gets their hands on the physical wallet.
In conclusion, beginning to invest in cryptocurrency really isn't that hard. Just begin!
Try some stuff out with small sums of money until you get comfortable and understand the space, once you understand the space and believe in it invest a little more.
Just don't go al in at once since the wallet and crypto storage process has had many people lose their money forever into the wallet abyss.
It may seem scary at first, but once you've played around a bit it will become clear and easy!
Disclaimer: Please note that this article is not financial advice, i merely provide my personal opinion on numerous topics.