What is Cryptocurrency?A guide to learning about cryptocurrency & how to get started safely buying, spending and making transactions.
Cryptocurrency or digital currency such as Bitcoin is an encrypted medium of exchange based on blockchain technology used to regulate the generation of units or coins and verify the transfer of funds. It is a peer to peer payment system that is independent of any government or central bank. Bitcoin has been called the digital Gold as it can be used as a store of wealth and can also be used as a method of payment, currently beyond the restriction and confiscation of governments. Cryptocurrencies are located on the Blockchain which is a digital ledger of all transactions and holdings in all wallets, the blockchain is located on hundreds or thousands of computers worldwide and therefore cryptocurrency is not located in any specific country, it is everywhere and nowhere specifically.
Cryptocurrency is a relatively new technology and as with all financial investments or speculations, you should not ‘risk’ more than you are prepared to lose, the total Cryptocurrency market cap is now approx. $300 billion which is still peanuts when compared to other financial markets and therefore prices are highly volatile. For perspective here are some approximate figures from between 2014 – 2016, Global stock markets market cap $77 Trillion, Global bonds market cap $100 Trillion, Global derivatives market cap $1.2 Quadrillion! Some say these markets are being manipulated by central banks and are due a massive correction and/or a total global financial crash, which is why I am moving some money into Cryptocurrency. Disclaimer
I’m sure you’ve heard plenty of people insisting Crypto is in a bubble, Why not judge that for yourself – World Markets Visualized
Cryptocurrency of any value can be transferred peer to peer, at any time to anyone, almost instantly at almost no cost. This is why big banks and governments generally do not like the idea and why you will often hear stories on mainstream media about digital currencies being used by terrorists or drug dealers because it is anonymous and therefore ideal for use in illegal trades and money laundering. The fact of the matter is, most digital currencies are not anonymous as such, all transactions can actually be traced via the blockchain and the blockchain cannot be deleted or altered. There are a few cryptocurrencies that are more private than Bitcoin but we’ll cover some of those elsewhere on the site.
Before you start thinking the price of Cryptocurrency is too high and you don’t have the spare money to purchase say, 1 Bitcoin which is currently valued at approx £ 0000.00 then don’t worry, Bitcoin is divisible by 100,000,000 these are called Satoshi. You can start buying crypto with as little or as much fiat money as fits your budget, you simply enter the amount of your currency you want to exchange and you will receive the equivalent amount of your chosen crypto.
Probably the easiest route in to cryptocurrency. Sign up for an account here and you'll receive $10 of FREE Bitcoin with your first $100 purchase (or your equivalent currency value).
Connect your bank account, credit/debit card so you can exchange into and out of your local currency.
Download the app on your mobile device to keep track of your Bitcoin, Ethereum & Litecoin on the move.
Any digital currency stored on coinbase servers (in your coinbase wallet) is covered by insurance.
Set up recurring buys to invest slowly over time, every day, week, month etc. or buy and sell at anytime.
The first thing you’re going to need is a wallet to hold your Cryptocurrency, there are numerous wallets available depending on the coin or token you want to hold. As you’re probably new to cryptocurrency I will recommend the best place to start based on my experience when I first got interested in digital currency, then from there I will provide links and information which will enable you to swap various coins such as Bitcoin, Ether & Litecoin for some of the lesser known coins and tokens. You will also find out where you can trade cryptocurrency much like you would trade fiat currencies ie. Sterling, Dollar, Yuan, Euro etc, on the Forex, should you have the risk appetite for it. I will also provide links to sites listing all the coins and tokens with upto date prices, YouTube videos that I’ve found very informative and which I think you will too.
Time to start…
I am going to recommend you start with a company called Coinbase because I’ve used them myself and have never had a problem, other than downtime of their site due to traffic when buying volumes are high but that’s a separate matter and they are working to improve and scale their systems as the whole cryptocurrency interest increases and more people buy into it… That aside, In my experience they are trustworthy and I use them. So, first off, you need to visit www.coinbase.com (This link will take you directly to the correct site and if you sign up using this link you will receive $10 worth of free Bitcoin with your first $100 purchase, I will also receive $10 of Bitcoin so thank you for helping to fund this site). Once registered you can also download the app to your smartphone, I have included links to the app for Android and Iphone on the useful links page here There are various levels of identification required depending on the amount you will be buying, this can be and was for me, a very annoying and slow process which may have you pulling your hair out at times, but bear with it as it will eventually workout.
Okay, I’ll assume you’ve registered and have access to your account. As you can see there are a couple of ways to fund your account, either by means of a bank transfer or paying using your bank card, I won’t include commission and charges here as they may change but simply put, the charges are higher when using your card and you can only buy smaller quantities but it’s not cost effective to transfer small amounts as your bank may charge you if it means you are doing an international bank transfer from say, Sterling GBP to your Coinbase Euro account. You will have to decide which option best suits your budget, either way you will have a limit to how much you can deposit in one week. Once you have received your Bitcoin, Ether or Litecoin you will see it in it’s respective wallet, you can either leave it there or purchase a hardware wallet such as the Ledger Wallet you can see below where you can send it offline for added security. At any point you can transfer it back to your Coinbase wallet and sell it back to Coinbase to convert it back to your currency and transfer back to your bank account. You will need to connect your bank account to your Coinbase account to perform this action.
Protect your Cryptocurrency!
Always buy direct from the manufacturer.
Store your Bitcoin, Ether, Litecoin DASH and more in your secure offline hardware wallet from Ledger. Hardware wallets do not need to be connected at the time of receiving your crypto, your wallet will update next time you connect it to the internet/Blockchain
Price check and purchase on Amazon but it's usually cheaper & always safer to buy direct from Ledger
Store your Bitcoin, Ether, Litecoin DASH and more in your secure offline hardware wallet from Trezor.
Price check and purchase on Amazon but it's usually cheaper & always safer to buy direct from Trezor
Whether you’re a professional trader or just starting out with cryptocurrencies, Binance offers a wide variety of tools for engaging with digital asset markets. It’s straightforward to buy and sell cryptocurrencies through the Binance exchange, while additional features make the platform capable of handling complex trading operations as well.
Register on Binance to start trading the easy way.
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