Cryptocurrencies have attracted a lot of interest from people from all walks of life. Many are attracted to the possibility of making profits within a relatively short time. It is a valid reason. Some cryptocurrencies like Bitcoin (BTC) have shown impressive price hikes over the years. There are other reasons why people should buy and hold cryptocurrencies.
Since cryptocurrencies are decentralized, they are not controlled by any bank or government. Hence, they are unaffected by inflation and economic turmoil caused by bank failures or similar events. Gold has been long considered a hedge against inflation. But now, cryptocurrencies can take over this role. No wonder Bitcoin is often referred to as “digital gold.”
However, many newcomers don’t have a clear idea of how to buy, store, and sell cryptocurrencies. They don’t know how to exchange crypto online either. With so many digital coins available nowadays, one can swap one cryptocurrency for a different one. But, how can you do it? Here, we will answer all the basic questions so you can invest in cryptocurrencies soon.
Buying and Selling Cryptocurrencies
To buy cryptocurrency, the easiest way is to do it through an online exchange. In most cases, you can buy the crypto of your choice with your credit card. But before buying, follow these steps:
- Find a reliable crypto exchange. There are many alternatives. Which one is the best? You can read online reviews that select the most convenient exchanges to use. You have to take into account several criteria for evaluation: transaction fees, online security, user-friendliness, type of service (custodial or non-custodial), anonymity, and others;
- Decide what cryptocurrency you want to buy. Realistically, you won’t be able to trade all the cryptocurrencies currently available. There are hundreds of them! So, you should research several cryptocurrencies before deciding which one to buy. If you already hold crypto, check whether the exchange you selected supports your trading pair. For example, if you already hold Monero (XMR) and want to buy Bitcoin with those assets, check whether you can convert XMR to BTC easily;
- Decide whether you want to trade or hold your cryptocurrency. There are two main ways to make profits with crypto. The first one consists of leveraging the market volatility in your favor. You buy digital coins at a low price and sell them when the price increases. These fluctuations may occur within a few hours or minutes. This strategy is referred to as ‘day trading’ or simply ‘trading.’ The second alternative is to hold your crypto for a long time. For this option, you need to select a coin with excellent prospects. Look for cryptocurrencies that have shown a bullish trend over the years.
Remember that before buying cryptocurrencies, you need a digital wallet to store your coins. There are different types of crypto wallets. The type you choose depends on whether you want to trade or hold your cryptocurrency. For trading, a mobile wallet is much more practical, whereas for the long-term holding a hardware wallet is safer.
Selling cryptocurrency is quite similar. In this case, you have to investigate whether some limits are imposed. You have to provide a bank account to get the fiat money after selling your cryptocurrency. Take into account that some banks don’t accept transfers from crypto exchanges. Hence, you have to inquire before you use your bank account number.