Cryptocurrency is making the headlines in the investment world today more than ever. It has been a topic of intense discussion over the last few years among individuals and organizations especially in 2017 where the popular bitcoin reached an all-time high.
The talk of people becoming overnight millionaires wouldn’t let others sleep and on a daily basis, more people are ready to throw in hundreds and thousands of dollars to earn some real money too.
It’s often common to find that when people have made the decision to invest in any crypto of their choice, they are still confused and don’t know where to start.
With so many options available, choosing the best may be very difficult. Buying cryptos require some processes although they are simple and straight forward when the investor is properly guided.
As the most popular cryptocurrency, bitcoin is the most wanted as it is now widely accepted around the world not just as a digital investment but also as a means of payment for goods and services.
Investing In Crypto Currency – How To Buy Crypto as Noob
The immutable and exchangeable cryptographic tokens promises to become big, hard and non-manipulatable money for the world.
Considering the world’s largest digital currency by means of market capitalization, investing in bitcoin is quite easy.
Another alternative is to use mobile apps such as Blockchain Bitcoin wallet for iOS or Bitcoin wallet for Android. This involves filling out an online form that includes providing your basic details. The filling process usually takes less than 2 minutes.
Payment method – Buy Crypto
One of the most common methods to buy bitcoin is to do so with cash. Other methods includes bank transfer or credit cards. Different websites have different provisions for investors to complete their transactions.
Once you have secured your bitcoin wallet, the next step is to ensure that the website you choose accepts the payment method you intend using. Once this has been ensured, the bitcoin is transferred to your wallet.
The availability of the selected payment method is subject to the area or jurisdiction and exchange opted for.
On websites that sell cryptocurrencies, there is an interface that shows both “buy and sell” option. The account holder is expected to choose which digital currency you are buying or selling aswell as your method of payment.
Bitcoin Exchange And Bitcoin Wallet
It is vital to always bear in mind that Bitcoin Exchange and Bitcoin Wallet do not mean the same thing.
Bitcoin exchanges can be likened foreign exchange markets. The exchanges are digital markets where Bitcoin is exchanged for fiat currency – for instance, Bitcoin for U.S dollars.
While exchanges offer wallet capabilities to users, it isn’t their primary objective. The security obligation of wallets means that exchanges do not support the storage of Bitcoins in large amount or for a long time.
Essentially, it is safer to transfer your Bitcoins to a secure wallet. Security is fundamental when choosing a Bitcoin wallet hence, it is much better to choose one that has multi-step verification facility.
Unlike what most people think, a Bitcoin wallet is mostly for your private key not to store Bitcoin. The assumption that Bitcoin are stored in wallets is absolutely incorrect as Bitcoins are not stored anywhere.
Bitcoin balances are however maintained by using public and private “keys”. They are usually long strings of letters and numbers interlinked through technical encryption and algorithms.
The public key is similar to an international bank account number accessible to the world, and to which other users may send Bitcoins.
As far as the private key is concerned, it can be likened to an ATM pin and should be safeguarded in all secrecy and only used to authorize Bitcoin transactions. Hence, the private key is kept in a bitcoin wallet.
Example of Bitcoin wallet security includes subjecting the wallet to a high-level encryption that involves a strong password or the cold storage option that involves an offline storage.
Coinbase provides a secure vault to host user keys.
Other processes involved in buying cryptocurrency includes;
Location: while looking for where to buy your crypto, it is important to consider your country’s regulations. This is to ensure that your dealings are within the ambits of your local trade laws
Type of Cryptocurrency: you may find that not all websites that deal in cryptocurrency buy and sell all the cryptos available in the market. You will have to find a website that sells the particular crypto you want to purchase
Cost of Fees: fees vary based on the website you choose. While some fees are cheap, others may be quite expensive. It is vital to know how much fees are involved before setting up an account with a website and buy the crypto.
How much risk are you willing to take: just like any other investment, users are advised not to invest more than they can afford. In most cases, it is important to speak with a financial adviser.
This is because cryptocurrencies are highly volatile and the level of risk involved exceeds most classes of investment.
Although Bitcoin is the same everywhere, the price varies across different countries and locations aswell as sellers. This means that buyers should look for the best rates at all times.
At some point in 2017 – South Korea, Bitcoin sold at a 35% premium while in India, 20%-25%.
The potential of cryptocurrencies being able to experience a remarkable increase in value like the Bitcoin was once worth 20,000 dollars, coupled with the increased acceptance and adoption has led to more investors fancying digital investments.
The changing regulatory stance however implies that investors are advised to thread on the side of caution. Price volatility aswell as taxation and legality are vital factors that should be considered when buying cryptos.
There is no certain assurance that the price of your selected cryptocurrency would go up. Like every other investment, there is the risk of a fall in prices too.
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