Cryptocurrency is the latest asset class in the financial market which gives you an opportunity to invest and earn a hefty return. Though cryptocurrencies don’t have any official global or governmental backing like your other financial instruments, the popularity they have seen in recent years has been quite robust. Most of this popularity stems from famous billionaire tycoons like Elon Musk and Jack Dorsey actively voicing their opinions on digital currency such as Bitcoin and Ethereum being an asset.
This has brought crypto coins like Bitcoin and Ethereum to the forefront of the public domain and has the average citizen interested in investing in it. It should be noted that recently, the crypto market has taken a beating and prices for some of the most popular coins saw an all-time low. However, experts believe that due to rising demand and interest, the market will recover and even move upwards.
With so much going for cryptocurrency and especially in India where so many are advocating for its classification as an asset, you should know exactly how to invest. Here are the basic steps you need to carry out to successfully invest in cryptocurrency.
Step 1: Finding the Right Crypto Exchange
Cryptocurrencies are not regulated in India, hence there is no established structure or uniformity to trading in cryptocurrency yet. This is where crypto exchanges come in. They act as a platform through which you can buy and sell your digital assets. Some of the more popular exchanges in India include WazirX, CoinDCX and CoinSwitch Kuber.
Step 2: Create your Account
After finalising the exchange that best suits your needs, create an account similar to that in a bank. Depending on the policies you opt for, the amount you plan to invest and what you plan to invest in, the exchange will ask you to verify. They will ask you to submit documentary proofs to prevent cases of fraud.
Step 3: Setting up the Account for Action
Before you can buy any cryptocurrencies, you will need money in your account. The money can be put in via a wire transfer from your normal bank account to the exchange account. Make sure to link both. Also, depending on the policy you may have to face a waiting period before purchases can take place.
Step 4: Buying Cryptocurrency, Making the Investment
Once you have everything set up, you need to pick which coin or coins you may want to invest in. The most popular one by far is Bitcoin, followed by other altcoins such as Ethereum, Cardano, Binance Coin, Tether, XRP and Dogecoin to name a few. After you make your purchase comes the most important part – storage. Crypto exchanges don’t have any formal institution backing them and they most certainly do not carry your average insurance policy. They also face the risk of being hacked. Therefore, it is important you store your codes to your account and your assets securely. It is often more advisable to store your bought coins in a crypto wallet.
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