Cryptocurrency doesn’t seem to be going away any time soon…
New technologies continue to revolutionize our lives. The printing press led to literacy for the masses. The industrial era laid the infrastructure for railroads and highways for mass transit. The microprocessor leading to personal computing and automation. The internet leading to the information age where almost anything is available via a google search. Smartphones and social media are allowing for worldwide communication at unprecedented levels. Learning about and leveraging new technologies is one of the best ways to compound your investments. Technologies that allow us to reduce space by digitizing products or reduce costs while increasing efficiency, are great to automate. For instance free cryptocurrency trading bots on the KuCoin exchange.
New opportunites in business, shopping, personal finance, investing, and new technologies that accompany these new forms of currency are expected to be as popular, if not more popular than the currency themselves. We are enterring a world of new investment opportunities and technologies from decentralized applications (DApps) to smart contracts.
If you’re not immersed in technology, it’s easy to get overwhelmed with the speed of new ideas in the cryptocurrency space. This guide is designed to cover the basics regarding how to get started with cryptocurrency?
Spending, Trading, and Investing
As the cryptocurrency technology expands over time, we are seeing more opportunities to use cryptocurrencies to purchase goods and services. While it’s easy to transfer funds from person to person, we are seeing more companies allowing purchasing.
While waiting on the widespread implementation of cryptocurrencies, many people and institutions are investing and trading cryptocurrencies. The idea of decentralized finance backed by the security and transparency of blockchain technology creates new opportunities for retail investors to take advantage of this space. Unfortunately, because cryptocurrencies are so heavily tied to the technology space, many people do not know how to start learning about trading and investing in cryptocurrency.
A common term used in the cryptocurrency community is HODL’ing. HODL means Hold On for Dear Life. Popular coins being held by many investors are Bitcoin, Ethereum, and Litecoin. While there are hundreds of smaller altcoins, I only recommend long term holding of coins with valid technology and larger volumes. There have been many smaller coins fail or been part of a scam, so ensure the viability of any coins that you are HODL’ing.
Many coins also offer opportunities to stake coins that you are holding to gain interest like dividend stocks. You can also use coins as collateral for loans in other currencies and various other decentralized finance protocols.
Lastly, you can trade coins on exchanges for short-term gains from the volatility swings of various currencies.
Understanding Cryptocurrency Wallets
To get started, you have to understand how to store, use, or transfer cryptocurrency. There are various types of wallets and each type of wallet has its own level of security and functionality.
Exchange Wallets with Debit/Credit Cards
Exchange wallets are not actually personal wallets. The exchanges hold the private keys and hold the ultimate power of how that funds are used. We’ve seen security issues and hacks across most major exchanges already, so it is not recommend to keep the majority on your funds on the exchanges.
Besides being able to trade or swap from one currency to another, some exchanges also offer credit/debit cards that allow you to transfer your cryptocurrency into fiat currency (real-world currency like US Dollars, Euro, Pounds, etc.)
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Crypto.com allows you to not only trade various cryptocurrencies but also to receive interest by staking coins for a period of time. This is a great way to increase your return on investments for coins you intend to hold.
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I am on the waiting list for a Coinbase debit card, but do not currently have one. I do have a Coinbase account and have used the exchange, but it is not my preferred trading account. Coinbase does have an education area that will pay you small amounts of various cryptocurrencies to watch videos about their technologies. Their rewards change from time to time, but you can find their current rewards here.
More and more exchanges are providing debit cards allowing easier access to investment funds, but exchange wallets are the most insecure way to store funds.
Other Exchange Wallets
While there are many centralized exchanges, these are my favorites.
KuCoin.com – Sign up here
I have been using KuCoin for a couple of years and they have become my favorite trading platform. They offer trading on margin, staking, futures derivatives and much more. They’ve recently created trading bots that are available on the mobile apps (not available on the browser platforms.)
Web and Software Wallets
MetaMask.io – Because the Ethereum Decentralized Finance (Defi) Ecosystem is unique with its decentralized applications and smart contracts, I recommend getting a wallet just for ethereum. You control your private keys with these wallets, whereas you do not with the exchange wallets.
Exodus – Exodus is one of the best digital wallets that can hold many types of digital assets while you hold the private keys. Exodus is my pick for a software wallet.
When you are not trading, staking, or shopping, you need to have somewhere safe and secure to keep your cryptocurrencies.
One of the rules any cryptocurrency trader lives by is… NOT to ever keep your cryptocurrency funds on an exchange! Exchanges are not banks. They hold the private keys. They may or may not be insured. This is why you need a reliable hardware wallet:
Ledger Starter Pack – The Ledger Crypto Starter Pack includes a Ledger Nano S, which is an entry-price hardware wallet, a $25 voucher to make your first cryptocurrency purchase, as well as their “Crypto Beginners Guide.”
It is one of the most secure options as it does not stay connected to the internet, and it has its screen meaning that even if it is plugged into a computer that is infected with malware, it retains its full security.
Trezor – Trezor is another hardware wallet. It is a bit more expensive than the Ledger Nano S, but doesn’t seem to offer anything more than the Ledger.
Security And Safety
Always do your research on an exchange, trading platform, or wallet before you hand over your payment details or any of your assets.
There are plenty of reviews and communities out there that will be able to give you the lowdown on all the big names, and from there you can see which are the safest bets.
While nothing is secure in the world of the internet, doing a bit of research beforehand can help prevent you from getting stung.
Once you choose an exchange and wallet that seem like a good match, do some background check and look out for potential security breaches and hack.