Unlike popular belief, you don’t have to be rich to invest in cryptocurrency. Still, you need to be knowledgeable, realistic, and intelligent to make some good returns on the investment that you have made. If investing in cryptocurrencies has caught your fancy, and you are all set to plunge into the world of crypto trading, we know your mind must be clouded with loads of questions. It’s legit to have your doubts. After all, you are going to invest your funds into this. Investing in crypto coins is slightly different from how you would invest in, for example, gold. You can see the physical form of gold coins, bars, or bricks and store them in a bank locker, but crypto coins are all digital money, and you don’t get to see them. These are just virtually present. We have put together steps to help you as a beginner buy, sell, and even hold cryptocurrencies.
Steps to buy/sell cryptocurrencies:
You may have heard that cryptocurrencies like Bitcoin have a very high value. The big news is that you can buy Bitcoins instantly and other cryptocurrencies in a fraction, the basis on the budgeted amount you want to start with. Ere you can begin trading in cryptocurrencies, you need to follow the below steps.
– As a beginner, you need to set up an account with any of the reputed crypto exchanges in India.
– Ensure to complete your KYC with the exchanges.
– You need to set up a crypto wallet.
– Have high-speed internet access to start trading.
Here’s how to choose a crypto wallet
Just like how you use a purse or a wallet to hold your cash when you go out, you need to have a crypto wallet to store the cryptocurrencies. This is an essential step before buying and then selling these virtual coins. You will come across different names of crypto wallets, but basically, there are two main types.
– Cold Wallet: A physical, hardware-based digital wallet to hold your cryptocurrencies is called a cold wallet. It doesn’t depend on the internet, and you use a highly sophisticated and secure flash drive to store your cryptocurrencies. Because of the multiple layers of security, cold wallets are difficult to hack compared to other wallets. Users are given a uniquely generated ‘private key,” which is also referred to as a “seed phrase” that is mandatory to access the cold wallet.
– Hot Wallet: This is just the opposite of cold wallets and is software-based. These generally come in the form of an app and need internet connectivity to be accessed. You can arrange an account online with two-factor authentication for more security.
If you are trading through cryptocurrency exchanges, you will be given online wallet access as part of your account package. Several companies like Ledger and Trezor have been making cold wallets, and these are an excellent place to begin with, if you want to go with a cold wallet.
How to Buy/Sell Cryptocurrencies:
Now that your wallet is all set up, it’s time that you make your first transaction to buy your cryptocurrency. Most exchanges make this process easy by providing a simple buy button on their site to get you started. No matter what cryptocurrency you purchase, your business will give you the option to check the current market value of the cryptocurrency in Indian currency. So, for example, if you wish to buy Tron (TRX), you can see the conversion of TRON to INR on the exchange website to make an informed decision.
Most cryptocurrency exchangers present you with three different orders that you can choose from to buy or sell your crypto.
– Market order: This is like an instruction or order passed to the exchange to buy or sell Bitcoins or other cryptocurrencies at the current market price. This method is the quickest and executes immediately.
– Stop order: Here, you need to set a price at which you wish to buy or even sell the desired cryptocurrency. So, only when the cryptocurrency reaches your set limit is when the buying or selling is triggered, which can be time-consuming to execute.
– Limit Order: Here, you pass on your order or instruction to the exchange to buy or sell cryptocurrency at your set price or better/higher.
Having a solid strategy in place is very important for trading through cryptocurrency. A quick tip for beginners, do not to use significant amounts for investment because a sheer lack of knowledge may make you lose more than gain. So start small, and as you start gaining more experience, and are confident, go ahead and invest higher amounts. Monitoring the fluctuation in the market value is advisable so that you can identify the right time to buy/sell the cryptocurrency of your choice immediately.