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How to Invest in Cryptocurrencies: Simple Instructions

© by penntoday.upenn.edu

Many novice traders avoid dealing with such kinds of assets as they are not sure of how they work and whether they are a good buy. Yet, they allow earning high rewards from both long-term and short-term investments. Besides, they can be easily used for all sorts of payments in the real world. Hence, you must know how to buy them in any case.

First, let us explain what cryptocurrency is so that we avoid any misunderstandings. It is a type of digital currency, which operates autonomously. It is neither regulated nor registered. That is why it is called decentralized.

You can make long-term investments and earn passively by holding the coins bought until their price multiples. Or you can opt for short-term speculations and earn from frequent fluctuations in prices. One must highlight that the crypto market is extremely volatile, the prices of such coins change hundreds of times per day.

Such assets are traded in pairs that may include either two digital coins or a crypto coin and a fiat currency. For example, BTC/USD, BTC/ETH, etc.

In general, when it comes to choosing the coin for buying/selling and the optimal time for that, the technique doesn’t differ much from trading stocks or Forex ― you must make decisions based on technical and fundamental analysis.

Now, we will explain in detail how to invest in cryptocurrencies:

  1. Register on a crypto exchange. We will discuss Binance as an example. So, you must go to their website and specify your region. Then, choose “Registration” ― “Create personal account”. You will be asked to specify your email address and a password. Depending on your place of residence, you may also be required to enter your mobile number and confirm it.
  2. Verify your identity. If you do not see the corresponding notification at the top of the window, press the icon of your account and open “Security” ― “Verification”. You will be offered several verification options. Be ready to make and provide the scanned copies of the IDs required.
  3. Make a deposit. We will explain how to send a payment in fiat currency. Open “Wallet” ― “Wallet Overview” ― “Fiat and Spot” ― “Enter” ― “Enter in Fiat”. Now, choose a currency, a sum, and a payment method and press “Proceed”.
  4. Check the market conditions. You can make use of charts, indicators, and other research tools in the “Trade” tab.
  5.   Make a purchase through a trading terminal.

In sum, trading crypto is pretty easy ― you can see step-by-step instructions above. So, if you haven’t tried it yet, be sure to add such assets to your portfolio.