The cryptocurrency frenzy is growing at a rate never seen before. Call it the probability of earning hefty profits in a short duration, or the associated feeling of pride of being a part of the buzzing cryptocurrency ecosystem – the reason to buy crypto coins can be many. Despite being a highly unregulated and volatile market, cryptocurrencies have managed to attract the attention and interest of both retail and institutional investors. If you’ve been fascinated by the cryptocurrency world too and are a First-Time Crypto Investor, and want to own a piece of the pie, be sure you’re aware of the fundamentals before investing.
While being aware of the top cryptocurrency to invest in is a good start, it isn’t enough information to get started on this journey. To help first-time crypto investors gain an edge over others, we’ve compiled an epic guide for First-Time Crypto Investor containing all the information beginners should know about the cryptocurrency market.
The ABC (Basics) of Cryptocurrency for First-Time Crypto Investor
Before you choose to invest in any cryptocurrency, be sure you’re aware of what a cryptocurrency exactly is. For the uninitiated, it is a digital asset that is generated by a process called “minting” on blockchain technology. These digital coins or tokens are created and secured using cryptography, a sophisticated, high-end technology that makes it impossible for anyone to alter past records or counterfeit any cryptocurrency. As it is a digital coin, you won’t be able to hold it physically in your hand, as you do with your fiat currency, i.e., Indian Rupee.
Also, there is no regulatory authority overlooking the functioning of cryptocurrency, which is why cryptocurrency prices are subject to severe fluctuations. If you’re comfortable handling the wild price changes and are not risk-averse, you might want to buy the cryptocurrency of your choice after conducting some market research. Also, to let you know, each cryptocurrency has been built using a special line of code, making it easier for these coins to be tracked as and when they’re traded.
Process of Buying Cryptocurrency
Luckily, the process of buying cryptocurrency is very simple, and you don’t have to be tech-savvy to be able to purchase some. Similar to stock exchanges and brokers, there are crypto exchanges and crypto brokers that facilitate the cryptocurrency trade. You have to pick the most reliable exchange that enjoys a positive reputation among crypto buyers. Once you’ve finalized the exchange you want to proceed with, download its app, and create an account on it.
Remember that you must own a KYC-verified account on any exchange to start trading. If you have valid address proof and ID proof, you can get your profile verified pretty quickly after uploading them on the exchange app. You can start buying and selling Ripple, Bitcoin, Litecoin, Ethereum, Dogecoin, Monero, and any other cryptocurrency supported by that particular exchange, once your account has been verified and made active. All the purchased digital coins are stored online on the exchange’s wallet. You can use digital tokens from the same source to facilitate further cryptocurrency trade.
Can the Government Ban Cryptocurrency?
A looming fear among many crypto enthusiasts and investors is the possibility of the government banning all cryptocurrencies. This hullabaloo about cryptocurrency getting banned has resulted in the generation of some serious crypto fear and greed index. But is the government really planning to ban all forms of cryptocurrencies and shut down crypto exchanges?
The truth is the Indian government expressed its will to regulate the cryptocurrency market by releasing a defined framework – which is now lacking. Investors have nothing to worry about since the government has clearly made its stand clear on not banning cryptocurrency. If you were holding yourself back from investing in your favorite cryptocurrency because of this reason, now is your chance to get it.
Things You Can Buy Using Cryptocurrency
As India is now slowly opening up to the idea of using cryptocurrency as a legitimate payment method, one can use it to make payments at top retailers and brands outlets. It should be noted that you cannot use it for daily transactions as of now, but you can expect something pretty similar to happen in the coming decade. For now, there are various companies that allow you to buy brand vouchers against cryptocurrency, so you can convert your purchased crypto coins into vouchers and use them at the respective brand outlets.
Some brands have also started accepting payment in the form of cryptocurrency, but the number of such brands is very thin in India. Also, you should check if the brands you usually buy from accept any form of cryptocurrency or just Bitcoin to make an informed buying decision. Most people purchase cryptocurrency to earn quick profits, while some buy it to diversify their portfolios. Be clear with your purpose of buying cryptocurrency if you want to use it to the maximum.
Is Cryptocurrency Investment Safe & Risk-free?
There is nothing called 100% safe and risk-free cryptocurrency. If you make FOMO-induced cryptocurrency buying decisions, you’re bound to incur financial losses. People making it big in cryptocurrency don’t blindly follow the trend. They analyze each cryptocurrency before investing their hard-earned money in it. So if you want cryptocurrency to work for you, always analyze the market, review its past price trends, and take calculated risks. It will keep you safe and prevent you from losing a lot of money in this space.
Now that you’re aware of all the essential information you should know before entering the cryptocurrency market; you will make fewer mistakes, and make more informed trading decisions. To start on good note, start investing in seemingly safer cryptocurrency options like Bitcoin, Ethereum, or other top cryptocurrencies in the top ten list. However, we advise you to do your research before investing any amount in any cryptocurrency.
