How To Invest Into Bitcoin And Cryptocurrencies
In under 5 minutes
Warren Buffett, one of the best investors of all time, once said:
“don’t invest in what you don’t know.”
Even though he isn’t the biggest proponent of bitcoin, I do have to agree with him on this one.
Cryptocurrencies and blockchain tech definitely aren’t the easiest things to understand. People throw around difficult and complex phrases like “decentralized distributed ledger technology” and “algorithmic hash functions,” (stay with me here lol) as if regular people know what this is. It’s no wonder why people are turned off from this amazing tech.
The good news is that you don’t need to get lost in the minute details of cryptocurrency and blockchain tech in order to actually buy it and make money from it. In fact, you can understand everything you need to know about blockchain technology, bitcoin, ethereum and more from the free crypto course over at free.cryptolete.com.
Once you understand the basics of the technology, then that is when you should start to invest and trade it (if that’s something you want to do).
If you understand what bitcoin and blockchain technology is, then this post will help you get started with buying and investing in it. (And if you don’t know the basics of bitcoin and blockchain tech, take the free crypto course at free.cryptolete.com!)
How To Get Started With Crypto
There are 4 steps to getting started with crypto. They include;
- Doing your own research
- Signing up to an exchange and buying your first crypto
- Looking into altcoins
- Trading (if you want)
1. Doing Your Own Research (DYOR)
As explained in the opening statements of this article, before you put your money into something, you should understand it. Like I mentioned, you can learn all about bitcoin and blockchain tech from the free crypto course available at free.cryptolete.com. Understand the technology before throwing your hard earned money into it!
2. Sign Up To An Exchange And Buy Your First Crypto
Once you know what crypto is, you’ll want to sign up to an exchange to buy some. Here’s how:
CashApp — Right now, the easiest place to buy bitcoin is actually the cashapp on your phone. Since cashapp is so popular, you might already have it installed. If you don’t have the app, you can install it for free by clicking here and buy your first bitcoin within minutes. By signing up, you’ll receive $5 when you buy $5 worth of bitcoin on the app.
Coinbase — If you want to buy more than just Bitcoin, or if you want to set up recurring purchases (which is a smart strategy), you can sign up to the most popular cryptocurrency exchange, Coinbase. On Coinbase, you can buy Bitcoin, Ethereum, XRP, Litecoin, and many other cryptocurrencies. By setting up recurring purchases on Coinbase, you can set it and forget it, which puts your investments on auto-pilot. If you sign up to Coinbase using this link, you will get $10 for free when you deposit $100 into your account.
After you sign up, it is recommended that you do not throw everything you have into it at once unless you understand the markets and technical analysis. Instead, it is recommended that you follow a tried and true principle of “dollar cost averaging.” That means that you buy a set amount each week. So, for example, if you have $10,000, you can put in $1000 each week for 10 weeks. This reduces risk. Conversely, if you understand markets and you believe the market is about to move up, going “all in” is a viable option.
3. Looking Into Altcoins
As discussed in the article “what are cryptocurrency altcoins,” altcoins are coins other than Bitcoin.
When deciding whether or not to invest in an altcoin, you really should do some research. This is because, unlike bitcoin and ethereum (and possibly xrp), altcoins are not as well established and much more risky than the top 1–3 cryptocurrencies.
When looking into whether or not to invest in altcoins, you should look at the team that is building the crypto. Are they professionals? Do they have past experience? What are their qualifications?
You want to look at the problem that the coin is actually solving. Many cryptocurrencies aren’t even necessary. If you can find one that solves a real-world problem, that is a great indicator that it can be a worthwhile investment.
Every crypto has what’s known as a whitepaper that goes over the crypto and what its plans for the future are. Usually, there is a condensed version of the whitepaper that is really easy to read. If you’re going to invest into crypto, it’s important to at least read through the condensed whitepaper so you understand what it’s about.
Social media accounts are also great places to look at when deciding whether or not you want to invest in crypto. Look at the cryptocurrency’s twitter account, Reddit page, facebook page, and Instagram.
When you are investing, you want to put your money into things you can get behind for the long term. You want to be confident that the money you are putting in will grow because the crypto or company you are putting it into has long-term potential. Using stocks as an analogy, let’s say you want to invest into Apple. You would want to know who runs Apple, what products are coming out, what their roadmap looks like over the coming years and a general sense of what they’re all about. You would also want to look at the current price and see where it is relative to where it’s been and base your decision of how much and when to invest off of that.
4. Trading
Trading is different than investing.
Investing is simply putting your money into something and waiting. You can wait a year, 5 years, a decade, or even longer. It will go up and down over and over again, but after a long enough period of time, if the company is profitable, you end up with great returns. For example, even if you went “all in” to Amazon at the height of the dot-com bubble when it was trading at $94, you would have seen your investment dwindle down to $7 within a year. However, because the company was solid, it eventually rebounded. Each share of Amazon is worth approximately $1800 today.
Trading is different. Trading involves moving your money in and out of something anywhere between a few minutes or a few months (depending on what type of trader you are).
Once you have your coins, you may want to trade them for others if you believe that different ones will do better than the one you own. Or, you can do what most traders do, which is to buy and sell altcoins to accumulate more bitcoin.
If you want to trade bitcoin and cryptocurrencies, you should learn about technical analysis. There are plenty of free articles and videos available for you over at blog.cryptolete.com to help you on your journey to becoming a trader.
Conclusion
You now have a basic overview of how you should go about getting started with crypto.
- Learn what it is.
- Find cryptocurrencies you want to invest into and buy them.
- Learn how to trade crypto so that you can compound your gains and earn even more.
For a complete instructional course that teaches you all about crypto and how to trade it, you can go to cryptolete.com to get started right away.
