How to Invest in Cryptocurrency? Step Guide for New Comers

Thinking of investing and earning a profit? Don’t know how to invest in cryptocurrency?

Finding it difficult to understand?

A lot of people face the same problems.

We are here with the simplest definitions to help you gain all the information about cryptocurrency.

This is going to be a step-by-step guide. Before that, we will learn a few points about what cryptocurrency is.

Cryptocurrency is any form of currency that exists virtually or digitally. Cryptography is used to secure all transactions. There is no central issuing in cryptocurrencies as it is decentralized and records transactions that way only.

Thus, investors are now thinking about investing in it.

Some key takeaways from the guide to investing in cryptocurrency for beginners are:

• Crypto is secured by blockchain technology.
• Investing in crypto can go from buying it directly to investing in funds and companies.
• Buy cryptocurrency by using a crypto exchange.
• Make sure you pay undivided attention to the transaction fees while making a crypto purchase.
• Crypto investment is risky so invest money not more than what you can afford to lose.

After learning these key points, you must have an idea of what to do when purchasing cryptocurrency.

Now, let’s move towards understanding the process of investment.

How to Invest in Cryptocurrency? A Step-by-Step Process

We will start with the process after learning what kinds of investments there are:

• Buying Crypto Directly: You have to option to choose to purchase crypto directly. You can buy Bitcoin, Ethereum, or any virtual coin.
• Investing in Crypto Companies: With this method, you can invest in companies that have a partial or entire focus on crypto. Options for these companies are Robinhood Markets Inc. and PayPal Holdings Inc.
• Crypto-Focused Funds Investment: In case you don’t want to choose from individual crypto companies, you can invest in crypto-focused funds. Investing in cryptocurrency for beginners gives you choices like index funds and future funds which are known as exchange-traded funds.
• Crypto Roth IRA Investing: For investing and garnering tax advantages of an individual retirement account (IRA), you can invest in a crypto Roth IRA. You get secure storage for your holdings.
• Become a Miner: This, perhaps, is the most direct way for investing. You can either act as a miner or a validator in a crypto network. If you learn how to invest in cryptocurrency by becoming miners and validators, you get plenty of rewards that can be held in exchange for another currency or investments.

What Are the Steps to Purchase Crypto from an Exchange?

The steps are as follows:

1. Select the Crypto Exchange: You should know that choosing a reputable crypto exchange is an important aspect. It is suggested that you go for a well-known crypto exchange having a huge collection of currencies.
2. Create an Account: After choosing the crypto exchange, the next step for investing in cryptocurrency for beginners is creating an account. Here, you have to provide your personal information for verification and complete the registration.
3. Funding with Fiat Money: Before buying any crypto, funding your account is necessary. You can use U.S. dollars to fund your account.
4. Deciding the Crypto You Want: Choose the crypto that you want to invest in by researching the options.
5. Place An Order: Once you decide which crypto you want, you can place a buy order for one or more crypto.
6. Store Crypto in Digital Wallet: When the purchase is completed, you can find all the information about the crypto in a digital wallet. This crypto wallet works as an independent wallet provider.

Alternate Ways to Learn How to Invest in Cryptocurrency

There are two other ways in which you can learn for your investment purposes:

1. Crypto Exchange Traded Funds: You can wait for exchange traded funds (ETFs) which are popularly known investments that provide immediate division and are comparatively less risky than other investments. Investors have a huge appetite for crypto ETFs which help you with investing in multiple crypto coins at once. Indian investors need to create a global account or invest through RBI-approved brokerage platforms. For investment in overseas ETFs, you have to transfer money as per the Liberalized Remittance Schemeroute.
2. Companies Related to Cryptocurrency: Investing in cryptocurrency for beginners is an easy task as they need plenty of information. If you want to invest in companies with various services or products, you can. However, these will be subject to regulatory oversight. Even though, you can purchase shares in these companies. All you need is an online brokerage account in a publicly-listed company.

How Much Money Should We Invest to Start With?

You can move on to know how much money you need to purchase it after being thorough on how to invest in cryptocurrency.

There is the option to invest in Bitcoin or any other cryptocurrency without spending a lot of money. How?

It can be done easily by using the Coinbase platform. For example, you can purchase cryptocurrency with a little amount such as two units of your currency.

Last Lines

Investment has many benefits and risks which the investors should be aware of. For beginners, how to invest in cryptocurrency is the basic question. All the steps that you need to follow and the things that you should keep in your mind are discussed.

Make sure you understand these points and work accordingly to gain a thorough knowledge of how to invest. You can search for various crypto exchanges and shorten the list by understanding which one is the best. Then, you can start with a small amount and move on to larger amounts as per your convenience.