Being in the crypto world is not that easy, especially if you are a beginner. There are so many things you need to know about cryptocurrencies that are so popular worldwide. Their influence is more than visible in the functioning of eCommerce today, and it’s more than evident that they will become the future of online shopping, having in mind the growing importance of the cryptocurrency marketplace.
Who knows, maybe in 20 years they will become part of our everyday lives and delete physical money from the face of the earth? It’s more than impressive to think about it, but let’s start with some basics like:
What Is The Cryptocurrency Marketplace?
By the cryptocurrency marketplace, people usually consider a place for buying, selling, and trading cryptocurrencies. As you may already know, those virtual currencies have their easily changeable value. You can use them for purchasing some goods and services online.
Their flexible value can drastically rise overnight like the Bitcoin in December 2020- more than $1000 in one moment. These marketplaces are decentralized, which means that they are not issued with some central authorities like the government. Instead, they are run by a mutually connected computer network. All the information is concentrated on the blockchain.
What Is Blockchain?
A blockchain represents a register of recorded data. It’s working on a principle of saving transaction details in “blocks.” By adding some more blocks, this is getting a form of “chain.” This form of the chain plays a vital role in recording transaction details like user’s activity and product searching information. It’s also used by some of the innovative eCommerce platforms like Safex.
What Is Investing?
Investing represents allocating resources with the hope and expectation of generating a profit. For example, you are using your money to buy land because you hope that you can resell it later for a higher price. It’s the same with cryptocurrencies. We also need to mention ROI(Return on Investment). This is a percentage value that reflects the profitability of the investment. It’s simple- a high ROI means that your investment was very profitable, and negative means that your return is lower than your costs. In general, most investors are not worried about short-term losses, so maybe you can try to be patient.
Is Investing In Crypto A Good Idea?
Most people will now say a huge yes to the cryptocurrency investment. But, let’s be real. The thing is, nobody exactly knows how they work and will their price grow or not. Even the person who invented Bitcoin is unfamiliar. They are a high-risk investment, and you need to be prepared to lose some or all your money. These currencies can also go through extreme ups and downs for one day.
Keep in mind that there are some people you shouldn’t meet. You can be deceived very easily. The main advantage of cryptocurrencies for people who want to commit some criminal activity without tracking is to make transactions entirely anonymously. On the bright side, if you are not in debt or are just curious, give it a try. Why not?
Buying and Selling Cryptocurrencies
Firstly, try to use an exchange. Cryptocurrency exchanges are websites that let you exchange your local currency for digital currencies. They are accepting many payment methods, like bank accounts with credit/debit cards and PayPal. Of course, there is a transaction fee that is usually about 1-4%. Always try to choose a website with a lower fee. The lower- the better.
If you are in the US, it would be much easier to buy some Bitcoin quickly or other currencies like Bitcoin Cash, Litecoin, and others. For shopping with Bitcoin or any other virtual currency, you’ll need a wallet.
- Crypto Wallet
It’s like an ordinary app on your phone, tablet, or laptop. With this, you’ll be able to transfer your physical money so you can buy Bitcoin or sell it later for some other cryptocurrencies. Not all platforms accept every cryptocurrency. If you already know what currency you want to buy, you’ll have to find a website that sells it. Some platforms like Coinbase are specialized for transferring money and for being a crypto wallet at the same time. Its fees depend on the payment method. Are you going to choose a bank account, PayPal, or cards- it’s on you. But, have in mind that the highest fee is when using a card, and it’s 3.75%.
- How to Buy?
Firstly, you need to create your account, and it’s necessary to choose a payment method, either a credit or debit card or a bank account. If you decide on a bank account, be ready to wait a few days for transaction processing. When it comes to investing in these currencies, never invest more than you can afford. Always try to set boundaries to your budget, including some of the fees.
- How to Sell?
Just like the buying, selling of cryptocurrencies is not complicated at all. The beginning is the same, go to the cryptocurrency exchange and choose the payment method. We can highly recommend platforms with lower fees like Bittrex, Binance, Kraken, Cex.io, and others. The lower is the fee, the less money you lose. After that, convert crypto into physical currency. There is also a limit of about $50,000 a day.
In this article, we’ve tried to introduce you to the cryptocurrency marketplace and its essential functions. Answering the frequently asked questions, we made a detailed introduction to the crypto world for all the beginners and those who want some more information about these digital currencies.
In general, the cryptocurrency marketplace could be a real adventure and challenge if you are able to invest. It’s very interesting, but risky at the same time. You never know for sure that currencies will grow or not, but one thing is sure- you can’t become rich overnight. That will not happen unless you invest some money first. Be free to try something new, and don’t forget about your budget limits. This is something like a game; all you need to do is to learn how to play it.