All You Need to Know About Making a Mint in Cryptocurrencies

Since Bitcoin hit the US$5,000 mark back in October, cryptocurrencies have been back in the news. Bitcoin Cash has been causing a disruption, and newspapers have been asking questions about whether we should be worried about the impact crypto could have on economies. As people have tired of the floundering global interest rates, they’ve looked for new and intelligent ways to put their savings to work, and cryptocurrencies have attracted a growing number of investors, from the independent dabbler, to the business looking to launch an ICO. Consequently, suddenly everyone is interested in the world of virtual finance, but while the current surge in interest is new, others have already immersed themselves in what they view as not only the future of banking, but the answer to their future fortune. They’ve thrown caution to the wind, cashed in all of their possessions, and invested everything they’ve got in cryptocurrency. Could you take that risk?

To begin with, the concept seems like insanity: what sort of a person would take their very real fiat fortune and trade it for a handful of virtual beans? But when you look a little bit further, you have to wonder if these people are onto something. There’s a fine line between visionaries and mad men, and if you’ve already made a mint in your nation’s established currency, you must be given some credit for knowing what you’re about, financially. That being the case, why doubt the sense behind a crypto investment? For most people, the doubt is fed by a lack of knowledge; while they might have heard of cryptocurrencies, they don’t necessarily know a lot about them. Well, this is your chance to find out.

What the Crypto?

So what, exactly, is cryptocurrency? The simplest description is a form of secure digital money. It’s created using cryptography — the most uncrackable of codes — which prevents fraudulent duplication, and also allows for user anonymity, in many cases. The first cryptocurrency was Bitcoin, created in 2009, and to begin with the currency was solely used online for purely digital transactions. Since that time, an increasing number of cryptocurrencies have come onto the digital market — 1,172 at the time of writing, although not all remain active, and some are more valuable than others — and their uses have evolved. No longer restricted to virtual transactions, many businesses are now accepting the strongest and most established cryptocurrencies — Bitcoin, Ethereum, LiteCoin, Ripple — as payment for everyday goods and services. With crypto payment cards coming into the picture this integration of virtual currency and real world is likely to grow rapidly.

Which leads on to the next question of why — why were cryptocurrencies created, and why have they become so popular? They were created to expedite online transactions. Rather than messing around with credit and debit cards, which, let’s face it, can be easily used for fraudulent purposes, and can sometimes involve lengthy delays between payment being issued and received, cryptocurrencies are constantly at their owner’s fingertips and can be transacted almost instantaneously. And this is part of their growing appeal.

The below are quotes taken from the Quora message board, discussing the benefits of cryptocurrency:

‘People use cryptocurrencies for the comfort — you don’t need to exchange money, they always cost the same everywhere. Also it’s anonymous and you can send them directly and super-fast between wallets…’ Regina Wallace

‘… I have a currency that gives me full control of my money. I can use it anywhere in the world, without needing to exchange for local currency. I can have my funds anywhere, anytime…’ Kostas Tsakaloglou

This is why the phenomenon is growing: people are passionate about it. And where there’s passion, there is money to be made, hence the growing number of crypto investors.

Who is Investing in Cryptocurrencies?

The amazing thing about it is, that there is no fixed demographic. Of course, the first crypto investors were those from the IT field, largely because no one else knew about cryptocurrencies, understood what they were or what they were for, or had any idea about how to go about investing. Now, there are crypto brokers, and buying the currency is no more difficult than visiting an online bureau de change before going on holiday. As such, the market has been democratised and anyone can become involved, which is why you see such a diverse range of upcoming success stories.

Firstly, You Have the Extremes

There’s the Taihuttu family; husband, wife, three kids and pet cat, who traded in their extremely comfortable 2,500-square-foot house, and practically everything else that they owned, in order to invest in, and trade, cryptocurrency. At the moment, living in a campsite. This way of life is earning them enough to pay for food, clothing and other essentials. Their hope is that it will eventually make them multi-millionaires. If it does, they wouldn’t be the first — 18-year-old Erik Finman began purchasing Bitcoin when he was 12 years old, and the coins were retailing for US$12 a pop. He currently owns 403 Bitcoins, which are valued at US$5,000 each.

It’s stories like Finman’s that inspired serial entrepreneur, Rafe Furst, to invest his US$100 Million fortune on cryptocurrencies. Being in possession of such a sum is unimaginable for most of us, much less gambling the lot on an untried investment, but Furst views it as an educated risk. “I think it’s the most important technology since the internet itself,” he says of cryptocurrency. And why wouldn’t he? It has already contributed to his $100 million business success, and he sees it as a gateway to his first trillion.

While not everyone aspires to be a trillionaire, thousands of other people are using cryptocurrencies to achieve their lifestyle aspirations. China’s Millennials are leading the way in this, working from bedrooms, they are ditching their regular jobs by the dozen, to invest their time and capital in trading cryptocurrencies — and for a huge number it’s been a gamble worth taking.

So, what do you need to do to start taking a gamble of your own?

How to Start Crypto Investing

The first step you’ll need to take is to open an account with a reputable cryptocurrency exchange — you can find a full list here. From there, you will need to establish a secure wallet in which to store your crypto funds and find somewhere safe to keep that. Then it’s time to watch the market. With so many different currencies available, it can be difficult to know where to put your money, and that’s where research and patience come in. Don’t jump in feet-first; take a little time to test the water first; monitor the fluctuations in the market; read the news and then make your purchase.

Making your money from any kind of investment is all about taking calculated risks, and cryptocurrency is no different. You can either sit on your investment and hope for the best, or you can jump in and exchange it. Using your currency to buy another, and then selling that on too is the way that fortunes are made — and lost. The very best thing you can do, is watch the market and research.

Alternative Ways to Bank in on the Cryptocurrency Trend

Crypto trading — like its fiat cousin, playing the stock market — is no for the faint hearted. There’s no doubt that it can make you a huge amount of money, but it can also lead to huge losses — and take years off your life! If you’re not quite ready to do battle in the crypto exchanges. There is another way to make your currency work for you: ICOs (initial coin offering).

More and more tech companies are using ICOs to generate cash for furthering their business plans. Based upon a token system, or the launch of a new cryptocurrency, an ICO is essentially a fund-raising exercise, not unlike floating on the stock exchange. The business gets an injection of [crypto] cash, and the investor gains a share in the company. If that company does well, they can then sell on those shares for a profit. To take part, all the investor needs to do is research the ICOs they’re interested in, watch for launch dates, then purchase tokens upon release. It can still be a risky business, if you don’t do your research upfront, but it’s far less heart attack-inducing than trying to trade your way to the top. The secret — if there is one — is to find an ICO for a going concern, and steer clear of the nebulous new-starters.

Making money is never easy. Whether you work all day in the established mode, commuting to a shop, office, hospital or other place of work, or sit in your spare room, trading stocks or cryptocurrency, there are ups and downs to be dealt with. Backing an ICO has a similar number of pros and cons, and it won’t make you an instant winner, but it could start you on a path to a passive income, which has the potential to make making money that little bit easier.