Cryptocurrency trade involves purchasing and selling different virtual currencies and exchanging them with other coins or fiat currencies. Although it somehow resembles forex, it’s different in terms of the technology it uses among other things. To get into the Crypto sector, you need a coin, Cryptocurrency exchange, and a wallet.
How To Get Your First Coin
Getting a Cryptocurrency is your first step when joining the Crypto sector. Exchanges are the most popular places to buy and sell different coins such as Bitcoin, Ethereum, Litecoin, etc. You can also get into mining to get your first coin. If you have a business, you may allow your customers to pay using digital assets thereby getting your first virtual currency.
Cryptocurrency Exchanges
Cryptocurrency exchanges are websites that enable people to purchase and sell different altcoins. To use an exchange, you need to open your own account. Once you have loaded your account, you can proceed to buy other coins on the website. Some of the most popular exchanges include Binance, Bittrex, Coinbase, and Coinmama among others.
Factors To Consider When Selecting An Exchange
Due to the high number of Cryptocurrency trading platforms, it’s advisable to do thorough research to ensure you have selected the right one. You should consider;
Supported Cryptocurrencies – Bitcoin, Ethereum, and Litecoin are some of the major virtual currencies. However, there are thousands of other little-known but still important tokens. If you know the coins you want to purchase, ensure they are available in your preferred exchange.
Customer Support – Given that the Crypto sector is a little more complex than most of the other markets, there are high chances of being stuck, especially when you are new. Dealing with an exchange with poor customer care services will only make it hard for you.
Methods of Purchase – Some virtual currency exchanges support only Crypto payments while others accept both Crypto and traditional money services. Dealing with a website that only supports Cryptocurrency payments means you will have to look for other places to buy the coins with your fiat currencies before loading your account. Most exchanges that support fiat currencies allow their customers to deposit or withdraw cash using methods such as PayPay, bank transfer, debit, and credit cards among others.
Security – Cryptocurrency exchanges don’t offer the same level of security. Given that they handle a lot of cash, they are a major target for hackers and some have fallen victim to them. Do online research to ensure that you are dealing with an authentic and secure website.
Cryptocurrency Wallet
After getting your first coin and exchanging it with other Cryptocurrencies, you need to find a secure place to store them. Cryptocurrency wallets serve this purpose. They are divided into two main categories namely cold and hot wallets.
Hot wallets are connected to the internet making them easily accessible. You can use your funds on a website, desktop, and mobile wallet wherever you are as long as you can access the device. However, their main disadvantage is that they are exposed to hacking.
Cold wallets are not connected to the internet and are regarded as the safest. They are especially ideal for storage of large amounts of coins. Their main disadvantage, however, is that they are expensive. Consequently, you should only use them for long-term storage or when your coins have appreciated.