The cryptocurrency industry has exploded in recent years. In fact, today, the crypto market was valued at USD 1.03 billion by 2019 and it is projected to reach USD 1.40 billion in 2024.
But whilst the crypto market has sparked a lot of interest, there are a lot of people who don’t quite understand the technology behind cryptocurrency and how it works. And for beginners, it can feel very overwhelming with all of the terms and different areas within this large space.
Simply put, cryptocurrency is digital assets that you own after buying them. In your possession, you then have digital coins that are backed by decentralized blockchain-powered platforms.
To help you get a grip on how cryptocurrency works and how you buy, sell, and exchange cryptocurrency, we have created a beginner’s guide that will be a helpful starting point.
How to buy cryptocurrency
As you could see, the crypto market is huge, and it is growing day by day. But there are also plenty of people who are interested in the crypto market but just don’t know where and how to begin. A good starting point is understanding where and how to buy cryptocurrency, and understanding the basics of how it works.
So how do you buy cryptocurrency?
The answer is that buying is not as complex as some people tend to believe. You buy crypto via an exchange. To do this, you create an exchange account in order to store your possession in a so-called digital wallet. Similar to a real wallet, the digital wallet is where you keep your crypto money.
Worth noting is that there are countless of cryptocurrencies, and with that said, you need to decide on what you want to buy. Some of the biggest and most well-known are bitcoin, bitcoin cash, Ripple XRP, Ethereum, to mention a few. In addition, new currencies pop up consistently.
When buying, you obviously want to learn about what you are buying. Try to study the currencies you are buying to learn more about what they are and what makes them unique. It’s better to become an expert in one currency rather than knowing very little about many.
It’s also worth having in mind that cryptocurrencies are far more volatile than actual currencies, so you need to follow the development closely and decide on values at which you will sell and buy. It’s best to start small-scale just to get a feeling of how it works and how you can maximize your chances of predicting the market, in particular by understanding the influencing factors
How to sell cryptocurrency
When you have bought cryptocurrency, you may eventually want to sell them.
So how do you go about doing this if you want to sell bitcoin for cash?
Generally, it can vary depending on where you buy them and what currency you are buying. In general, you can sell them either via an exchange, direct trade, or through a peer-to-peer transaction.
When selling, the funds will be credited to your account, and to convert it into actual money, you need to withdraw them to your connected bank account. Depending on where you do this, the time it takes to get access to the money varies.
Depending on where you trade, different crypto exchanges charge different amounts in order to make a withdrawal. If you, for example, want to change usdt to usd, you will be able to see how much your crypto is worth through conversion. This can easily be done online.
How to exchange cryptocurrency
If you simply want to trade cryptocurrency you just need a brokerage account, rather than accessing the underlying exchange directly.
To exchange cryptocurrency, you use an exchange, which is an online platform that helps with the direct person to person trading. In other words, the exchanges work as middlemen between buyers and sellers and usually charge a small fee for each transaction. The market decides how much each currency is worth at a given time, and as with regular stocks, these can change greatly depending on factors such as supply, demand, governmental regulations, etc.
The cryptocurrency market is today worth over $267 billion, and it is growing immensely day by day. There are a lot of people who are interested in the crypto market and want to explore what this world has to offer, but for beginners, there is a lot to think about, and if you are just starting out, it can feel overwhelming.
Hopefully, these tips have helped you get a better sense of how it works. Start by understanding the basics of how you buy, sell, and exchange, and most importantly, the technology and concept behind it and how it works. Before you invest in the crypto market, it’s important that you understand how it works and what it is you are actually buying. This will significantly increase your chances of succeeding in the market.