Before we go deeper into investment in cryptocurrencies, let me first ask you, do you know what investment actually is?
According to Adam Hayes (2021) on Investopedia, an investment is an asset or item acquired with the goal of generating income or appreciation. Appreciation refers to an increase in the value of an asset over time. When an individual purchases a good as an investment, the intent is not to consume the good but rather to use it in the future to create wealth.
That is basically what investment is. So, what is investment in cryptocurrency and how to start using cryptocurrency to let your money ‘grow’?
- Learn the foundation of cryptocurrencies
As we all know there are actually a lot of cryptocurrencies that we can choose from and all of that have differences in some matters. You have to know how to use the cryptocurrency and how they work to avoid money losses. There are various types of cryptocurrencies that you can choose such as Bitcoin, Ethereum, Doge mama, Litecoin and a lot more. Learn the foundation of each in order to decide which one is suitable for you and your financial status.
- Choose a cryptocurrency and the crypto exchange
You have to choose what cryptocurrency you are going to use and invest in and you can find that they actually have slight differences from each other. To purchase cryptocurrency, you must first select a broker or a cryptocurrencies exchange. A cryptocurrency exchange is a marketplace where buyers and sellers may trade cryptocurrencies. Exchanges frequently offer cheap costs, but they can have more complicated interfaces with various trading kinds and advanced performance charts. There are various places for crypto exchange such as Coinbase, Gemini and Binance.US. They also offer user-friendly options for beginners.
- Create a trading account
You must first establish a trading account with the cryptocurrency exchange of your preference. This account will function similarly to a bank account. During the registration process, the exchange will check your credentials depending on the services you select, the amount you intend to deposit, and the available coin trading choices.
- Deposit your investment cash
Investing in cryptocurrency is just the same as buying something. In order to buy something, you will need a secured fund in your bank account. You may fund your crypto account by connecting your bank account, allowing a wire transfer, or even paying with a debit or credit card. You are always open to choose whichever method you prefer. Bear in mind, not every crypto exchange has the same efficiency so, you will have to wait for a few days before you are able to continue with your purchase.
- Choose a storage method
If Forex trading, you will need a strategy, it is just the same when it comes to investing in cryptocurrency. Cryptocurrency exchanges are not protected by the Federal Deposit Insurance Corp. (FDIC), therefore they are vulnerable to theft or hacking. If you want your money to be saved, make sure you do research on cryptocurrency storage methods. Do not make a silly mistake that will cost you all your money.