How to Invest in Cryptocurrencies (Bitcoin, Ethereum and Altcoins)?
At the start, some of us may find the world of cryptocurrency a bit hard to grasp. But don’t let that intimidate you.
Getting into cryptocurrency these days is easy due to the wealth of information and the global community that surrounds it, both of which are easily accessible on the Internet. Let us now delve into the world of cryptocurrency and learn why this innovation would take off in the years to come.
WHAT IS CRYPTOCURRENCY?
The easiest approach to describe cryptocurrency is to think of it as digital decentralized money. It is built on blockchain technology, which is a distributed ledger maintained by a network of computers.
It is hard to counterfeit cryptocurrency since it is protected by encryption. The fact that cryptocurrency is not issued by the government or any other central body is one of its most distinguishing characteristics.
Cryptocurrency may be used to purchase services and goods, and many individuals invest in it in the same way that they would when investing in stocks, artwork, or other assets.
WHAT IS BITCOIN?
Today, Bitcoin is the most widely used and highly valued cryptocurrency. Without the assistance of a bank or other intermediaries, this decentralized digital money may be traded, swapped, and purchased directly.
Satoshi Nakamoto invented Bitcoin to meet the need for a "electronic payment system based on cryptographic proof rather than trust," as it was initially described.
Because of bitcoin's decentralized structure, all transactions are recorded on a public ledger that can be viewed by anyone. This makes it incredibly difficult to forge or reverse any transaction.
WHAT IS ETHEREUM?
Ethereum is a blockchain with its own native cryptocurrency, Ether (ETH), often known as Ethereum.
Ethereum's network, like Bitcoin's, is a decentralized public ledger that can record and verify transactions. Ethereum is now valued second only to Bitcoin.
Altcoins are alternative cryptocurrencies to Bitcoin (alternative coins). With a few variations, all of these cryptocurrencies share the same properties as Bitcoin.
Some cryptocurrencies, for example, use a novel approach to validate transactions. Altcoins with novel features, like smart contracts, are also available.
Stablecoins: These are coins that are linked to real-world assets. Facebook's Libra, which is pegged to the US Dollar, is an example of a stablecoin. The objective behind this notion is to lessen currency volatility, which is one of bitcoin's disadvantages.
WHY INVEST IN CRYPTOCURRENCIES?
It is secure.
Investors that use bitcoin can benefit from one of its most important features: security. Bitcoin and other cryptocurrencies are intended to be part of a safe system, and the decentralized structure of blockchain means that no one can steal or falsify a transaction without hacking thousands of machines.
It is accessible.
Another advantage of cryptocurrency is that it can be purchased with only a few mouse clicks using your desktop or mobile phones. You also have a multitude of platforms to choose from.
Unlike the stock market, the cryptocurrency market is open 24 hours a day, seven days a week. As a result, you may purchase or sell cryptocurrency at any time of day at your convenience.
There is no middleman.
Cryptocurrencies are decentralized, with no intermediaries such as banks. This reduces the cost of financial transfers by eliminating the need to pay a large charge to a third party, verifying your deposits and withdrawals.
The transactions are also safe. Since cryptocurrencies do not need large transaction fees, they are ideal for worldwide transactions, regardless of the sender or recipient's location.
It is hedge against inflation
Because of rising expenses of products, the money you hold in your bank may lose value over time. When it comes to cryptocurrencies, though, the same cannot be stated.
Cryptocurrencies have a finite supply, making it a hedge against inflation since it has a limited quantity incorporated into its source code. When no more coins can be mined, the value will rise in lockstep with inflation.
RISKS WHEN INVESTING INTO CRYPTOCURRENCIES
Volatility
Consider when Elon Musk referenced Dogecoin to get a sense of how volatile cryptocurrency is.
The cryptocurrency's value plummeted by 70% after Musk also expressed his concerns about the energy consumption of cryptocurrencies.
The values of most cryptocurrencies, particularly Altcoins, fluctuate wildly as well. Therefore, it is advisable, like with other investments, to diversify your portfolio rather than placing all of your money into a single coin.
Irrecoverable
Thousands of bitcoins are currently locked and will never be retrieved. Forgotten passwords are the most typical cause of this.
You will be totally responsible for your cryptocurrency after you have purchased it, and if you forget your password, your coins will be lost forever.
Similarly, if you are tricked into paying a bogus merchant using cryptocurrencies, you will have no legal recourse to recover your funds.
Regulations
If you want to invest in cryptocurrency, you need to be prepared to watch the changing laws around it. Recently the Securities and Exchanges Commission (SEC) in the United States approved Bitcoin Futures ETFs to trade in the U.S. Stock Market.
HOW CAN YOU BUY CRYPTOCURRENCIES IN THE PHILIPPINES?
Coins.ph
You must first download the Coins.ph app, which is available for both Android and Apple smartphones, in order to purchase coins on this platform. The coins they offer are Bitcoin, Ethereum, Bitcoin Cash, XRP, USDC, Chainlink, Kyber Network Crystals, Maker, Uniswap and Aave.
After you have downloaded the app, create and fund money on your account through remittance centres, over-the-counter banking, kiosk payments, and e-wallet and online banking transfers.
Both smartphone and desktop versions of Binance are accessible to users when buying and selling cryptocurrencies. To use this site to purchase and sell cryptocurrencies, you must first create an account.
After you've created an account, go to the homepage and click "Buy Now."
Using your credit or debit card is the most convenient method to pay for your current balance. Simply input your card information, complete your order, and see the recalculated amount when you're ready.
To confirm your payment, you will be taken to your bank's OTP (one-time password) website. After that, you'll be able to see the cryptocurrency you purchased in your account's wallet.
GCash (Available Soon)
The country's most popular mobile wallet will soon add cryptocurrency trading to its platform, although the partnering business has not yet been revealed.
If you made it this far, thanks for reading. You do have a genuine interest in investing in cryptocurrencies.
As with most investments, cryptocurrency is not just some get-rich-quick scheme, even when it’s something as radical and envelope-pushing as cryptocurrency.
In order to enter, survive, and thrive in the cryptocurrency world, you must know what it’s about, why you should add it into your investment portfolio, and both the principles and nuances of cryptocurrency trading.
If you’re really keen on knowing more and possibly investing in crypto, you should truly understand the science behind it first.