Investing in the cryptocurrency market can be a bit daunting for traditional investors as cryptocurrency direct investment (CC) requires the use of new tools and the adoption of some new concepts. Therefore, if you decide to enter this market, you should be very clear about what to do and what to expect.
Buying and selling CC requires you to choose an exchange to trade the product you want to buy or sell, be it Bitcoin, Litecoin or more than 1,300 other tokens. In the previous version, we briefly described some of the products and services provided by the exchange to inform you about various products and services. There are many scholarships to choose from, and they all do things in their own way. Look for things that are important to you, such as:
– Deposit policy, methods and charges for each method
– Withdrawal Policy and Fees
-The fiat currency they use for deposits and withdrawals
-The products they use, such as cryptocurrency, gold, silver, etc.
– transaction costs
-Where is this exchange? (US/UK/Korea/Japan…)
Be prepared for detailed and lengthy Exchange installation procedures, because Exchange generally wants to know a lot about you. This is similar to opening a new bank account because the exchange is a broker of valuables and they want to make sure that you are who you are and that you are a trustworthy person. It seems that “trust” is gained over time as exchanges usually only allow small investments.
Your Exchange stores your CC for you. Many offer “cold storage”, which simply means that your coins will remain “offline” until you indicate that you want to do something with them. There are many news stories about exchanges being hacked and many coins stolen. Think of your coins in the exchange’s bank account, but remember that your coins are digital only and all blockchain transactions are irreversible. Unlike your bank, these exchanges do not have deposit insurance, so keep in mind that hackers will always try their best to obtain and steal your cryptocurrency. Exchanges usually offer password-protected accounts, and many offer 2-factor authorization schemes – keeping your account safe from hacker attacks requires serious consideration.
Since hackers like to rob the exchange and your account, we always recommend using a digital wallet to store coins. It is relatively easy to transfer coins between your Exchange account and your wallet. Make sure you choose a wallet for all the coins you want to buy and sell. Your wallet is also the device you use to spend coins at merchants that accept CC payments. The two types of wallets are “warm” and “cold”. Hot wallets are very easy to use, but they expose your coins to the internet, but only on your computer, not the Exchange server. Cold wallets use offline storage media, such as special hardware memory sticks and simple hardcopy printing. Using cold wallets makes transactions more complicated, but they are the most secure.
Your wallet contains a “private” key that authorizes all the transactions you want to initiate. You also have a “public” key that is shared on the network so that all users can identify your account when they transact with you. When the hacker gets your private key, they can move your coin to any place they want, and this is irreversible.
Despite all the challenges and violent swings, we believe that the underlying blockchain technology will change the rules of the game and completely change the way we trade in the future.