Basic guide to start investing in Cryptos.

Dear Crypto-Enthusiasts,


Suppose someone has taken the decision to start an investment on the market for cryptos. This person must have a basic knowledge about three essential steps:

1. How to use his/her money to make the initial purchase of a crypto?
2. How to exchange cryptos?
3. How to store cryptos?

We start with the first part of the market for cryptos. You can use e.g. “CoinMarketCap” to be able to track the evolution of cipher prices and which bins are available. It's also a great resource of all kinds of information, regarding cryptos.
The purchase of a crypto is usually not done by the direct exchange of money for a coin. The user will need to buy one of the most common cryptos like Bitcoin (BTC) or Ethereum (ETH) first. Then buy the other crypto in exchange for BTC or ETH. The first step usually includes the registration with a bank account and/or official documents like ID or passport. This step varies between different platforms. Trusted and well-known examples currently are:

• Coinbase (San Francisco)
• Kraken (San Francisco)
• eToro (Isreal, UK, Cyprus)
• Bitstamp (Luxembourg)

The choice of the platform to make the initial purchase depends on factors like daily prices, fees and taxes and can vary a lot! Another solution is to purchase BTC directly from individuals through platforms like “LocalBitcoins.com” or use a Bitcoin ATM.

Once the user purchased BTC or ETH on the exchanges we mentioned, the second step is to exchange them with a wide range of cryptos that particular exchanges are specialized in.
Two of the most famous platforms are:

• Binance (Tokyo)
• Bittrex (Las Vegas)

Transfers on platforms to exchange cryptos may take from a few minutes up to a few hours, depending on the network load. Many users choose to leave their cryptos stored in the platform, but this method is not safe. Which leads us to our third step.

There have been several thefts on several platforms in the brief history of cryptos. Another issue is, if the user has no internet connection or an exchange is in an upgrade phase, the user can lose access to the cryptos temporarily.
The described way of storing cryptos is called a “hot wallet”, because it’s like a virtual wallet with permanent connection to the internet. This permanent connection to the internet is the reason, why it is technically possible to steal its content. Hardware wallets, also known as “cold wallets” are physical devices to store cryptos without permanent connection to the internet. Ideally, for every user who chooses to invest in cryptos, one of the first purchases he/she must make is a hardware wallet. These devices enable the user to store private keys and the cryptos that they have purchased. This provides dual security compared to online digital wallets as millions of online digital wallets have literally been lost as malicious software manages to bypass the digital keys of users when they try to access their wallets online.
Currently, the two most famous solutions on the market are:

• Trezor
• Ledger Nano S

By using these devices, users can store their cryptos after they are purchased at the exchanges and minimize the likelihood of their investment being stolen. The cost of acquiring them is the minimum and pre-requisite investment the user must make before commencing any investments.

By finalizing today’s article, we stress that each user should do his/her own research before deciding to make the step of entering the markets of cryptos. But if he/she decides to do so, he/she must do so in a methodical manner and prioritizing safety.

And last but not least a general advice regarding safety of your transactions: A lot of platforms have applications for phones and offer full access and functionality through your smartphones. But these applications and smartphones in general are much easier to manipulate than regular computers! Therefore, it’s not recommended to make your trades on your phone.

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All the best,

Christos Kolokythas

and

Janis Ruhnau

Blog Manager