Investing in the Crypto Currency market space can be a little daunting for the traditional investor, since investing directly in Crypto Foreign currency (CC) requires the use of new tools and adopting some new ideas. So if you do decide to dip your own toes in this market, you will want to possess a good idea of what to do and what to anticipate.
Buying and selling CC’s requires you to choose an Exchange that deals within the products you want to buy and sell, be these people Bitcoin, Litecoin, or any of the more than 1300 other tokens in perform. In previous editions we have briefly described the products and services offered at a few exchanges, to give you an idea from the different offerings. There are many Exchanges to choose from and they all do things in their very own way.
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Look for the things that matter to you, for example:
– Deposit policies, strategies, and costs of each method
– Withdrawal policies and costs
— Which fiat currencies they offer in for deposits and withdrawals
: Products they deal in, such as crypto coins, gold, silver and so on
– Costs for transactions
— where is this Exchange based? (USA / UK / South Korea / Japan… )
Be prepared for the particular Exchange setup procedure to be comprehensive and lengthy, as the Exchanges generally want to know a lot about you. It is akin to setting up a new bank account, since the Exchanges are brokers of belongings, and they want to be sure that you are who you say you are, and that you happen to be a trustworthy person to deal with. It seems that “trust’ is earned over time, because the Exchanges typically allow only little investment amounts to begin with.
Your Trade will keep your CC’s in storage space for you. Many offer “cold storage” which simply means that your coins are kept “offline” until you indicate that you want to do something with them. There are quite a few news stories of Exchanges becoming hacked, and many coins stolen. Think about your coins being in something like the bank account at the Exchange, but remember that your coins are digital only, and that all blockchain transactions are permanent. Unlike your bank, these Trades do not have deposit insurance, so remember that hackers are always out there trying almost everything they can to get at your Crypto Coins and steal them. Exchanges generally offer Password protected accounts, and lots of offer 2-factor authorization schemes — something to seriously consider in order to safeguard your account from hackers.
Given that cyber criminals love to prey on Exchanges and your account, we always recommend that you use an electronic wallet for your coins. It is relatively easy to move coins between your Exchange accounts and your wallet. Be sure to choose a finances that handles all the coins you wish to be buying and selling. Your wallet is also the device you use to “spend” your cash with the merchants who accept CC’s for payment. The two types of wallets are “hot” and “cold”. Hot wallets are very easy to use but they leave your coins exposed to the internet, yet only on your computer, not the Exchange server. Cold wallets use offline storage mediums, such as specialized equipment memory sticks and simple difficult copy printouts. Using a cold wallet makes transactions more complicated, but they are the safest.
Your wallet contains the “private” key that authorizes all the transactions you want to initiate. You also have a “public” key that is shared on the system so that all users can identify your account when involved in a deal with you. When hackers get your personal key, they can move your cash anywhere they want, and it is irreversible.
In spite of all the challenges and wild volatility, we are confident that the underlying blockchain technology is a game changer, and can revolutionize how transactions are executed going forward.