Cryptocurrency can be defined as a type of digital asset. Because every one of its transactions is highly encrypted, the moniker derives from how safe the trades are. Contrary to fiat currencies, which are regulated and governed by a central body, it is decentralized in nature. Cryptocurrencies have a limited supply and are occasionally compared to priceless metals like gold and silver.
Mining is the practice of using powerful computers to solve extremely difficult puzzles to create Bitcoin, but first, you should know what is Bitcoin. It is necessary to understand the concept of crypto or other currencies. This is typically done as compensation for carrying out profitable cryptocurrency operations. So simply, the introduction of new cryptocurrencies into the globe frequently occurs from the trade of existing cryptocurrencies.
How does Cryptocurrency work?
Blockchain, a decentralized public ledger that is maintained and preserved by currency holders, is the technology that underlies cryptocurrencies. By leveraging computer processing power to solve challenging mathematical puzzles, a process known as “mining,” units of cryptocurrency are created. Although you must learn crypto and the basics, you must also learn about the various kinds of cryptocurrency if you intend to invest in some.
Additionally, customers can purchase the currencies from dealers, then store and utilize digital wallets. When you hold cryptocurrencies, you don’t own something. What you possess is a key that enables you to transfer data or a piece of measurement between people without the use of a reliable third party.
Now, let’s figure out how you can invest in Cryptocurrency-
1. The Right Cryptocurrency- There is no additional hurdle or consistency to cryptocurrency trading in India because there is no regulatory framework for the industry. The sites of the crypto exchanges, however, make it simple to purchase and trade your virtual money. Some of the most well-known cryptocurrency exchanges include WazirX, UnoCoin, CoinDCX, and CoinSwitch Kuber. And of course, before diving into cryptocurrency, you should be informed about what is Bitcoin or Etherium, so that you can make a wise choice.
2. Opening a Trading Account- A trading account must be created at the cryptocurrency exchange of your choosing. Comparable to a bank account, this one will be depending on the services you select, the money you intend to deposit, and the accessible coin trading possibilities, the market will check your credentials when you join. Shared KYC (Know Your Customer) information must be made available, and payment methods must be established. You might have to signify your PAN card, photo ID, and address verification for KYC. In contrast to normal stock markets, cryptocurrency exchanges operate 24/7 all year long.
3. Fund Account- You must deposit funds into the cryptocurrency trading account after creating an account to purchase cryptocurrencies. From your bank account to the cryptocurrency trading account, you can transfer money online. But to do so, you must link the two accounts. Additionally, there can be a timeframe before you can buy digital currencies, based on the regulation.
4. Buy and Invest in Cryptocurrency- You must first learn crypto and then choose the currencies you want to trade in after opening an account and sending money. By far, Bitcoin and other altcoins like Ethereum, Cardano, Binance Coin, Tether, XRP, and Dogecoin are some of the most well-known ones that you can invest your money in.
5. Save your Currency- After you have made your purchases, storing is the most crucial component. Digital currencies do not have any official institutional support, and therefore almost certainly do not have typical insurance coverage. The possibility of being hacked is another concern. You must thus safely preserve the passwords to your account and your valuables. Keeping your acquired coins in your crypto wallet is typically a good idea.
6. Strategize your Currency- Use Elliott Wave Theory to create a great plan of action to increase your profitability. Since Elliott Wave Theory focuses on the psychology underlying market emotion, it is effective for risky investments like cryptocurrency. Additionally, you can acquire advice from some bitcoin experts before increasing your investment in cryptocurrencies. Instead of heedlessly acting on recommendations from anyone, it is best, to begin with tiny investments and carefully research the whole market.