How to start your cryptocurrency investment
Cryptocurrencies have emerged tremendously as a new asset class. Investors have jumped on the cryptocurrency due to the potential for large profits over a short period of time.
How to start investing in cryptocurrency and what you need to watch out for.
Step 1: Select a Crypto Exchange :
There is no set structure or uniformity to cryptocurrency trading in India because there is no regulatory framework for the industry. The sites of the crypto exchanges, however, make it simple to purchase and sell your digital money. But for better experience of crypto trading CoinCRED offers a well structured app.
Step 2 : Start a Trading Account :
To start trading, you must create an account at the cryptocurrency exchange of your choosing. This account will resemble a bank account. The exchange will check your credentials during registration based on the services you choose, the amount you intend to deposit, and the choices for exchanging coins that are offered. Sharing KYC (Know Your Customer) information and setting up payment choices are required. You might have to provide copies of your PAN card, picture ID, and address verification for KYC. Notably, unlike traditional stock markets, cryptocurrency exchanges run 24*7.
Step 3 : Add Funds into your account :
You must deposit funds into the cryptocurrency trading account after creating an account in order to purchase cryptocurrencies. From your bank account to the cryptocurrency trading account, you can transfer money online. But to do so, you must link the two accounts. Additionally, there can be a waiting period before you can buy digital currencies, depending on the regulation.
Step 4 : Investing and Buying Cryptocurrency :
It will pay to conduct some study before you acquire some coins or tokens just because someone thinks it's a smart investment. It's crucial to realise that choosing a reliable cryptocurrency is different from choosing a reliable stock. A share of stock indicates ownership in a business that, at the very least, has the potential to generate income for its shareholders. Cryptocurrency ownership entails possession of a digital object with no inherent worth.Simple supply and demand is what determines whether a cryptocurrency's price rises or falls. The price rises when demand increases and supply becomes more constrained. You must choose the coins you want to invest in after opening an account and sending money. By far, Bitcoin and other altcoins like Ethereum, Cardano, Binance Coin, Tether, XRP, and Dogecoin are some of the most well-known ones.
Step 5 : Store your cryptocurrency :
After making your purchases, storage is the most crucial step. Cryptocurrency exchanges are not officially supported by any organisation, and therefore almost certainly do not have a standard insurance coverage. Additionally, they worry about being hacked. As a result, you must securely keep the passcode to your assets and account. Generally speaking, it is a good idea to keep your bought coins in a crypto wallet.
Top cryptocurrencies for Beginners
You shouldn't try to locate a diamond in the rough as a new bitcoin trader. You should start off with more established cryptocurrencies that are supported by networks that have already been put in place. You will then be able to better understand how bitcoin investment works and how it fits into your portfolio.
BITCOIN : Every exchange for cryptocurrencies will allow trading in Bitcoin. With Bitcoin, you know exactly what you're receiving because it's a well-known currency. Although it is only digital currency and nothing more, the first-mover advantage has led to its widespread adoption. In terms of actually functioning as a means of exchange, this provides Bitcoin a competitive edge.
ETHEREUM : Another excellent option for novice investors is ether. The majority of DeFi initiatives, which use the Ethereum blockchain to carry out smart contracts and offer financial services without a central authority, are powered by Ethereum technology. A user must spend Ether each time they wish to add a smart contract to the blockchain. Ether demand will rise as DeFi apps become more widely used.
CARDANO : Cardano is a third choice for novice investors. Cardano is an Ethereum competitor that employs a proof-of-stake technique to validate blocks on the blockchain, making it more energy-efficient. As a result, its transaction costs are now substantially cheaper than Ethereum's. In addition, similar to Bitcoin, Cardano maintains a hard cap on the total amount of its tokens. That implies that the supply may eventually be limited, which would raise the price.