Cryptocurrency is always making headlines. Some are great, and some are terrible.
In November 2021, the headlines were positive as Bitcoin hit an all-time high of $68,000. The whole crypto market was up as high as it had ever been.
But in 2022, the headlines look a bit bleak as we sit in a bear market where prices and market sentiment are down in the dumps.
The silver lining, however, is that it’s the perfect time to become a new crypto investor. All the best coins are discounted right now. And every cryptocurrency investor dreams of buying at the bottom and riding the wave back to the top.
So what are you waiting for? Keep reading below to learn how to start investing in cryptocurrency today.
Table of Contents
Choose a Crypto Exchange
The first step to becoming a bitcoin investor is to choose a crypto exchange to use. Most people buy crypto online through an exchange, which functions much like a stock broker.
Creating an account and adding funds takes some time, so plan ahead. The biggest part is identity verification. You must submit a photo of your ID, likely a photo of your face, and your social security number, along with a lot of other information.
Verification of your information can take minutes, hours, or sometimes days.
Alternatively, you can speed up the process of investing in bitcoin by visiting a bitcoin ATM. During your first visit, you’ll still need to create an account, but verification is generally much quicker.
Once created, you can buy crypto with cash in moments. Check out the Byte Federal policy here to learn more about how it works.
Purchase Crypto
Once you have a verified account with a cryptocurrency exchange or ATM, you can make your first crypto purchase. Most new crypto investors start with a bitcoin investment.
Bitcoin is the most popular, most valuable cryptocurrency in the world. It’s the original, having launched back in 2009.
This coin has the most liquidity and the biggest likelihood of seeing a big price hike next time the bull market kicks in.
Ethereum is the next most valuable coin. Rather than acting solely as a store of value, like bitcoin, Ethereum was developed specifically for other developers to build on top of.
It’s an ecosystem of decentralized finance, and it currently supports countless applications, crypto tokens, and opportunities to make more money.
Investing in Ethereum is an investment into a wide world of decentralized finance.
To make a purchase with an online exchange, you’ll want to transfer funds directly from your bank. Doing so should be free. Then, you can select the coin you want to buy, confirm the current price, and finish your transaction.
The crypto is then stored in your account on the crypto exchange, which is considered custodial, as they are holding your crypto under their custody.
Take Control of Your Keys
Not your keys, not your crypto. Spend any time investing in cryptocurrency and you’ll start to hear this phrase over and over again.
It’s the idea that unless crypto is stored in your own personal wallet, you don’t actually own it. If your crypto is left on a crypto exchange, it’s not actually yours.
It’s under the control of the exchange, and if they want to block withdrawals whenever they feel like it, they can do so.
Serious crypto investors don’t mess around with that kind of risk. Instead, they set up a crypto wallet and move their funds into it. This way, they control the private keys to their crypto, and therefore, actually own it.
One of the most important aspects of cryptocurrency is that it doesn’t rely on financial institutions. You don’t have to hold your funds in a bank in order to use them.
As a peer-to-peer digital currency, you own it, you are responsible for it, and you can send it to anyone at any time, without asking a financial institution or payment processor for permission.
You can download a free software wallet on your computer or phone which allows you to store crypto in your own wallet. But the best option is to purchase a hardware wallet, like a Ledger or Trezor.
These are the most secure and virtually eliminate the possibility of losing funds due to online scams. Crypto cannot leave a hardware wallet without physically verifying the transaction by pressing buttons on the hardware wallet.
Keeping your bitcoin investment safe is worth the $60.
Diversify With Various Coins
Bitcoin and Ethereum aren’t the only cryptocurrencies worth investing in. While there are many thousands of crypto coins currently available, there are only a few hundred that have any merit.
Check out websites like coinmarketcap.com to see which cryptocurrencies are the most valuable and the most popular.
Research various coins to learn about the founding developers, the reason it exists, and the technology behind them. If a coin is built to solve a problem or to create something new, there’s likely a chance it can appreciate its price in the future.
Adding new coins to your portfolio and diversifying beyond bitcoin is a good idea.
Put Your Crypto to Work
You don’t just have to stick crypto in a wallet to collect dust for months at a time. You can put crypto to work to start earning more crypto and boosting your net worth over time.
One of the easiest ways to do this is by staking your crypto. Staking is the process of locking up your crypto so that it can participate in network security.
It’s used to verify transactions on the blockchain, keeping the global, decentralized network secure and free from fraud.
As a result, you earn a portion of transaction fees based on the amount you stake, which can be anywhere from 1% to 20% depending on which crypto you stake.
Success as a Crypto Investor
Finding success as a new crypto investor doesn’t happen overnight. It requires you to get in the game, start investing, and constantly be learning.
It’s a process. But if you stick with it and learn to master the market, you can make crypto work for you to build some serious wealth.
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