By Joe Megan
Now that the cryptocurrency market has passed the test of time, an increasing number of people are looking for ways to invest in cryptos.
Assuming that you have some basic knowledge regarding how the crypto market and blockchain technology work, let’s see what the investment process looks like.
How to invest in cryptocurrencies
1. Choosing the crypto broker
There are indeed many cryptocurrency trading platforms, and they are growing like shrooms every day. Choosing the right cryptocurrency broker or exchange should be taken seriously since your hard-earned money is at stake. Check the crypto brokers reviews before selecting the right one. The thighs to pay attention to are the spreads, the security of transactions and leverage requirements, user-friendliness of trading platforms.If you are hesitant in your choice, start by reading Voytegeon Review and see what this crypto broker has to offer.
Before going for any crypto broker, you have to decide which cryptocurrencies you are going to invest in. Then look for the broker with the largest trading volumes of that particular cryptocurrency.
2. Fund your crypto account – Fiat to Bitcoin Exchange
If you are new to the financial markets, you will probably want to fund your account with fiat money, be it dollars, euros or pounds. In that case, you obviously need a broker that allows fiat to crypto transactions. Mind that many exchanges only accept Bitcoin when it comes to funding your crypto account. If you want to trade cryptocurrencies and buy altcoins such as Ripple, Dash or Litecoin, it’s usually viable only with Bitcoins. That’s why it’s important to first go for fiat to bitcoin exchange.
After you have picked up your crypto broker, you will open an account to put your funds in. You can fund your account with fiat money by credit card or using your bank account. The good news is that recently you can fund your account using Paypal since Paypal recently allowed its customers to make transactions in cryptocurrencies.
3. Choose your crypto wallet
To invest and trade cryptocurrencies, you will absolutely need your crypto wallet to store your assets. Of course, you can always keep your cryptos on the exchanges or brokerage account. However, putting them into your wallet is the most secure way to store your holdings. You have two options here: cold wallet, also called hardware wallet, since it is a device that can work offline, keeping your private key and user’s address completely safe.
And the second option is a hot wallet which is a piece of software you have to download onto your PC or mobile phone to store your digital assets. It’s not unusual for crypto investors to have several wallets, both the hot and the cold wallets, for the sake of security. If you are planning to purchase goods and services with your cryptocurrencies, then the hot wallet is a more practical option. Many hot wallets are designed to work only for a specific mobile application or a particular cryptocurrency.
4. Select your cryptos – diversify your portfolio
As with any other investment in assets, diversification is critical. Don’t invest just in one cryptocurrency. You can choose from large caps cryptos such as Ethereum, Litecoin, Bitcoin Cash, Tezos and Ripple. When it comes to mid-caps cryptos, you can go for NEO, DASH or VeChain and many more.
