Cryptocurrencies are on the rise, but so are the risks and scams. The Cryptocapitalist Guide to Storing and Trading Your Cryptocurrency is a beginner’s guide to the world of cryptocurrencies. It will teach you about bitcoin, investing in cryptocurrencies, and how to store your cryptocurrency securely.
The Cryptocapitalist Guide to Storing and Trading Your Cryptocurrency is a short read that will teach you about:
• What a cryptocurrency is.
• The most popular cryptocurrencies today.
• The basics of trading cryptocurrencies.
• How to store your cryptocurrency safely after you purchase it.
• 25 tips for becoming a better cryptocapitalist.
In this guide, I will give you the basics for storing your cryptocurrency. This will be a good foundation for you to build upon later.
For those of you who don’t know me, my name is CryptoCap and I’ve been trading various cryptocurrencies for some years now. I was an early adopter of Bitcoin and have seen the crypto market grow exponentially. I am no expert in cryptography but do have a good understanding of the cryptocurrency ecosystem.
Great news! You have decided to dip your toes in the water of cryptocurrency. Maybe you have taken the full plunge and bought some Bitcoin, Ethereum or Litecoin. Also, maybe you are holding off until it comes down in price. Regardless, you are here to learn how to safely store and trade your new cryptocurrency.
I am going to assume that you already know a bit about Bitcoin and other cryptocurrencies. If not, there is plenty of information at https://bitcoin.org/.
The first thing that you need to do is buy some cryptocurrency. I am going to be using Bitcoin as an example for this guide however, most of what I say will also apply to any other currency like Ethereum or Litecoin.
You can buy Bitcoin on one of many exchanges with fiat money (USD, EUR) or from a person-to-person exchange like LocalBitcoins.com using cash or a bank transfer.
**NOTE:** It is possible to buy a portion of a Bitcoin or any other cryptocurrency. You don’t have to buy one whole coin all at once if you can’t afford it right now!
One of the first things you need to do, once you have decided which currency to invest in, is find a place to store it. The most common strategy, and the one I recommend for beginners, is to purchase your cryptocurrency from an exchange and then transfer it to a personal wallet that you control.
The most popular exchanges are Coinbase and Gemini, but there are many others. Whichever one you decide to use, be sure to set up two-factor authentication. This adds an extra layer of security whenever you log in or make a transaction by requiring an additional pin number that is sent by text message or generated by an app like Google Authenticator.
Once you have purchased your crypto, move it into an offline wallet that only you control. Some investors choose to keep their crypto stored on the exchange they bought it on in the hopes that they can quickly buy or sell at any time. But this leaves them open to hackers who could steal their money if they gain access to the exchange’s servers. This has happened before with Mt Gox and Bitfinex so take care not to leave your crypto on an exchange for too long!
The safest place for your crypto is on a hardware wallet like Trezor or Ledger. These devices look like flash drives (
Cryptocurrencies are a digital form of currency that is secured by cryptography so that they can be bought, sold, sent and received anonymously. Cryptocurrencies are not tied to any country or central bank which allows them to be used globally. Due to the anonymous nature of cryptocurrencies, and their decentralized nature, they have been used as a method of payment for illegal goods on sites such as Silk Road (which has since been shut down).
Cryptocurrencies are stored in digital wallets. Digital wallets can either be hardware wallets (an external USB device), software wallets (software installed on your computer) or paper wallets (private keys printed onto a piece of paper). In order to store cryptocurrency in a wallet it must first be purchased from an exchange. Cryptocurrencies can then be bought from an exchange using fiat currency (US Dollars, Euros etc.) or by exchanging other cryptocurrencies for them. The most widely known exchange is Coinbase, as it has been around the longest and has had the most media coverage.
When buying cryptocurrency on an exchange it is important to move it into your own wallet, as leaving it on an exchange leaves it susceptible to being stolen by hackers. If you don’t move your currency into a wallet you also leave yourself open to having your account disabled by
What is a Cryptocurrency?
A cryptocurrency is a digital asset designed to work as a medium of exchange that uses strong cryptography to secure financial transactions, control the creation of additional units, and verify the transfer of assets.
Cryptocurrencies are classified as a subset of digital currencies and are also classified as a subset of alternative currencies and virtual currencies.
Bitcoin, created in 2009, was the first decentralized cryptocurrency. Since then, numerous other cryptocurrencies have been created. These are frequently called altcoins, as a blend of alternative coin. Bitcoin and its derivatives use decentralized control as opposed to centralized electronic money/centralized banking systems. The decentralized control is related to the use of bitcoin’s blockchain transaction database in the role of a distributed ledger.
So you’ve just purchased your first Bitcoin, Ethereum, or Litecoin on Coinbase (Congrats!) and now you have friends talking about XVG, NEO, OMG, WTC etc. Other coins (also known as altcoins) that may be better investments. So what do you do?
In this post I’m going to outline the steps for purchasing altcoins, sending them to the appropriate wallet for storage, and then moving them back to an exchange for trading.
An easy place to get started is Binance.com. This is a free to use exchange that has most of the popular altcoins available for purchase with Bitcoin or Ethereum. Once you’re on Binance’s site create a free account and click ‘Funds’ -> ‘Deposits Withdrawals’. This will show you the coins they have available for trading. Find Bitcoin or Ethereum depending on what coin you want to trade with and click ‘Deposit’. This will give you a wallet address that looks something like this:
You should also download the official wallet application for whatever coin you’re sending in case Binance goes down