You've probably been hearing a lot about cryptocurrency lately. Friends, family, coworkers - it seems like everyone is talking about Bitcoin, Ethereum, and the wild ups and downs of digital money. Some are calling it the future of finance, while others think it's a big bubble ready to burst.
No matter which side you lean towards, there's no denying that crypto is a fascinating and rapidly growing space. People from all walks of life are looking for ways to get involved with this new asset class. Some are just dipping their toes by looking to buy crypto with credit cards.
Others are hoping to learn and earn crypto through educational platforms that reward users with small crypto payouts for learning about blockchain technology. And many more want to cut through the hype and really understand - how does cryptocurrency work behind the curtain?
So, in short — as we discussed interest in cryptocurrency has surged in recent years. More and more people are looking to buy crypto with credit cards, learn and earn crypto, and understand how cryptocurrency works so they can invest in this new digital asset class. In this blog post, we'll cover everything a beginner needs to know about crypto. And also, we'll break it all down in easy-to-understand terms.
One of the easiest ways for newcomers to get started with cryptocurrency is to buy crypto with a credit card on a reputable exchange like Coinbase or Crypto.com. Most major exchanges allow credit card purchases of Bitcoin, Ethereum, and other popular coins.
The process is fairly simple - you create an account, link your credit card, and purchase your desired cryptocurrency. The coins then get deposited into your crypto wallet on the exchange. One downside is that credit card purchases often attract higher fees than bank transfers.
Another way to get involved in crypto is through "learn and earn" programs offered by many of the leading exchanges and platforms. The premise is simple - you watch short educational videos or engage in interactive learning activities about blockchain and crypto, and get rewarded with a small amount of cryptocurrency for learning.
CoinBase Earn, Binance Earn, and Crypto.com's Crypto Earn are a few examples. The rewards are usually just a few dollars worth of crypto, but it's a risk-free way to get your feet wet and start collecting some coins through learning.
So what exactly is cryptocurrency and how does cryptocurrency work? Cryptocurrency is a form of digital money that is secured by advanced cryptography. Unlike traditional fiat currencies like dollars or euros, crypto isn't issued or regulated by governments or banks.
Instead, cryptocurrencies are decentralized and run across a network of computers throughout the internet. Every transaction on the network is securely recorded on a public digital ledger called the blockchain.
New crypto coins are "mined" by powerful computers that solve extremely complex math problems to validate transactions on the blockchain. The miners get rewarded with new crypto coins for their work processing transactions and securing the network.
For those looking to invest larger sums into crypto, you'll want to learn more about how to invest in cryptocurrency for the long-term. Many experts recommend only investing what you can afford to lose since crypto prices can be highly volatile.
A popular strategy is dollar-cost averaging - investing a fixed amount at regular intervals, such as $50 per week. This allows you to buy more coins when prices are lower and fewer when prices are higher, averaging out over time. A similar approach is used in the Indian financial market through Systematic Investment Plans (SIPs).
It's also wise to diversify across different cryptocurrencies since they don't all rise and fall at the same time. Bitcoin and Ethereum are usually seen as the safest bets, but smaller altcoins that solve unique problems have more upside potential if mainstream adoption takes hold.
When researching different cryptocurrencies and how much to potentially invest, a useful tool is a crypto market cap calculator. A market cap represents the total value of all coins currently in circulation for a given cryptocurrency.
To calculate it, you take the current price of that crypto and multiply it by the circulating supply. So if Bitcoin is trading at $70,000 with approx 19 million coins in circulation, its market cap would be approx $1,380.61 billion (70,000 x 19,710,371).
Larger market caps generally signify more valuable, established cryptocurrencies. While smaller market caps may be more speculative, they also have more room for growth. Many analysts value crypto projects based on their market caps relative to their competitors and utility.
Finally, all crypto enthusiasts should understand the concept of a "crypto bag" and a crypto bag policy. Your crypto bag represents the total holdings across all the different cryptocurrencies that you own.
A crypto bag policy refers to strategic guidelines you set for yourself around managing that portfolio of crypto assets. This could involve percentage allocations to Bitcoin vs altcoins, profit-taking rules for when coins rise drastically, or risk management parameters like maximum draw-down levels.
Having a well-defined crypto bag policy can remove emotion from investment decisions and keep you disciplined. It's a smart practice as your crypto holdings grow over time.
So there you have it - the basics of buying, earning, understanding, investing, valuing, and managing cryptocurrency as a beginner. The crypto space moves quickly, but mastering these fundamentals will give you a strong foundation to build upon. Just remember to always do your own research before investing any money anywhere!
Also read - Top 5 Crypto Memecoins Listings in June 2024 (Part 1)
