A basic guide to cryptocurrency

Cryptocurrency has been a game-changer in the twenty-first century, thanks to its capacity to allow frictionless, cost-effective and transparent transactions. However, inexperienced cryptocurrency users may find the process of purchasing digital assets a bit difficult, mainly because of the quantity of information that must be processed. 

Luckily, you’ll find all you need to know about cryptocurrency all in one place in this in-depth guide in Livecasino. Keep reading to fully understand crypto and all that comes with it!

What is cryptocurrency

Cryptocurrency is a digital currency used as a medium of exchange to buy goods and services online. To encrypt and safeguard the transfer of sensitive data, cryptographic protocols or coding systems are used in this system. 

No central authority controls the supply and value of crypto and oversees crypto’s operations. Instead, it utilises blockchain technology to maintain fairness and immutability. ‘Blockchain’ refers to this network of distributed computers acting as a central ledger for all data.

Blockchain is an open-source ledger that stores information on all transactions. These transactions are collected into blocks, subsequently confirmed and posted to the blockchain for storage upon verification. Once data has been saved on the blockchain, it is hard to change it, making fraud and tampering impossible to perpetrate.

How to invest or trade

Both traders and investors want to benefit from the crypto market, but they accomplish their aims in different ways. Investors hold their assets for a long time and sell at a higher price to increase their returns. They also have a longer time horizon for asset growth, which means more significant returns. 

On the other hand, traders take advantage of the crypto market’s volatility by making numerous short trades. Compared to investors, they usually make less money because they benefit from price hikes. 

However, these little earnings add up quickly when entering and quitting many trades. As a result, traders can still get a substantial profit depending on how active they are in trading. Day trading, scalping, swing trading and trend trading are some common strategies traders do to get returns.

Interpreting the market movement before trading or investing is a vital skill you need before you enter the crypto sphere. Depending on your expertise and knowledge, there are different approaches you can try. Here are some of them:

  • Technical Analysis – is the study of an asset’s past trading movement. This involves looking at past data such as volumes and patterns using charting tools and technical indicators. 

Traders utilise data gathered from this analysis to forecast and locate high-return opportunities. Technical analysis may examine risk management in enterprises and anticipate probability.

  • Fundamental analysis – An asset’s economic and financial context is examined using fundamental analysis, a technique used by traders and investors alike. It uses macroeconomic and social aspects as indicators to follow an asset’s movement in the market.

Where to invest cryptocurrency

If you’re looking to invest in crypto, it’s best to find a site where you can safely and easily purchase cryptocurrencies. Check out some of the well-known exchange platforms where you can exchange cryptocurrency for other coins or fiat money below:  

  • Coinbase – One of the world’s most prominent and trustworthy cryptocurrency exchanges, Coinbase was established in 2012 and is headquartered in San Francisco. You may trade, buy and sell digital currencies like Bitcoin, Ethereum, Litecoin and more on this platform.
  • Binance – Trading cryptocurrencies on the Binance platform is possible in over 180 countries. Users may store their tokens in a cryptocurrency wallet offered by the platform. Many Bitcoin consumers favour Binance over other exchanges because of its low fees and high liquidity.
  • Coinmama – Coinmama is an Israeli exchange platform founded in 2013. You may use your credit card, debit card or bank transfer to purchase and sell cryptocurrencies on this site.

Top cryptocurrencies

The sheer number of cryptocurrencies available might be intimidating when you’re just starting in the crypto realm. As a starting point, these are the top five most popular cryptocurrencies.

  • Bitcoin (BTC) – Dubbed the ‘mother of all cryptos’ by the crypto community, Bitcoin has always been the most extensively utilised cryptocurrency since it demands the highest USD exchange rate. The technology’s core blockchain has fueled advances in fintech.
  • Ethereum (ETH) – Ethereum was established in 2014 by programmer Vitalik Buterin and is more than just a cryptocurrency in the traditional sense. It has risen to become the world’s leading programmable blockchain, enabling anybody with the technical skills to create decentralised apps (dApps) on the blockchain platform.
  • Ripple (XRP) Ripple is a decentralised network that intends to allow transactions in only a few minutes with cheaper costs anywhere in the globe. It was founded in 2012 by RippleLabs. It aspires to replace the antiquated banking system by providing a reliable, cost-effective and quick network for international payments.
  • Cardano (ADA) – Founded by three academics, Cardano has a scientific foundation that sets it apart from its contemporaries. Following Bitcoin and Ethereum, Cardano is considered by experts a third-generation innovative contract-based blockchain. And in terms of market capitalisation, Cardano is now the 5th largest cryptocurrency.

How to store cryptocurrency

After choosing a cryptocurrency exchange, the following step is selecting a wallet for your crypto tokens. There are many different types of cryptocurrency wallets, and each one has its own set of advantages. Wallets available for purchase include the following:

  • Hardware wallet – Your coins will be safe and secure in your hard or cold wallet. It usually comes in the form of a device similar to a flash drive that can be plugged into a computer. Using this wallet, you may keep your tokens in an offline location and away from online attacks.
  • Software wallet – Hot wallets are those that you can access online through a mobile device or computer. Creating an account is required before using it. But as long as you have an internet connection, you may access your account on a software wallet from any device.

Choose your crypto coin and invest now!

The moment has come for you to get your hands on some cryptocurrencies and figure out how to invest your coins. Find out how much money you may make by investing in cryptocurrencies!

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