About two months ago I decided to jump into crypto coins after listening to a CBC news segment about Ethereum(ETH). I bought in at approximately $250 and I bought one unit. Ethereum is not considered a coin as it represents itself as the block chain. At the same time I also bought $100 of bitcoin (BTC).
When you buy into cryptocurrency you do not have to buy an entire coin you can buy any denomination although some online sites might have a minimum order that you can buy.
How to buy cryptocurrency
There are two ways you can buy bitcoin and other cryptocurrencies online. One is on a digital platform like coinbase (if you sign up to bitcoin we both get $10 of free bitcoin) and the other is using an exchange. The two work differently. On coinbase you can use your credit card to purchase crypto. On coinbase you can either buy Bitcoin, Ethereum, or Litecoin. Once you have an amount of any of those you can transfer the whole or a partial amount to an exchange. For example I use Binance.com and to buy a different coin for example IOTA then I transfer some of my Ethereum to this exchange. It is held at binance as 100 units of ETH/USD. After that I can buy units of IOT/ETH and it will add to that balance and take away from the ETH/USD.
Buying crypto currency on coinbase is fairly straight forward. You click on the buy/sell tab at the top, select which crypto you wish to buy and then enter the amount of CAD or USD you want to purchase and press buy at the bottom.
It gives you a summary of the details of what you are buying on the right hand side of this page and after it is bought you can click on dashboard to see how much of each crypto you hold.
To transfer crypto from coinbase to an exchange then you have to first go to the exchange and click on deposit, which is under funds tab. In my example I am going to be depositing Ethereum. So I click on the deposit next to the ETH symbol.
After this screen you want to copy that ETH deposit address. Now you go back to coinbase.com and click on the “accounts” tab.
You want to click send on the crypto you wish to send to the exchange for this example I am sending Ethereum.
Click on continue once you are sure that the wallet address matches the wallet address from the exchange. The address contains a string of numbers and letters.
After this it will ask you for a code from your cellphone to verify the transaction and it will also confirm the wallet address, and then after you press confirm you will see that the crypto is on its way to the exchange.
Now when you logon to the exchange the crypto you sent should be there, if not you can click on view details as above to see at what stage its at.
Many people don’t understand cryptocurrency because it’s intangible asset, you can’t hold it, you can’t touch it. Also a traditional stock exchange has set hours usually business days between 8.30am until 4.30pm. The cryptocurrency exchanges are 24 hours a day and 7 days a week. I don’t think they even stop on Christmas Day.
The currencies we know ie USD or CAD are referred to as ‘fiat’ by the cryptocurrency community. Although having ‘currency’ in its name, crypto currencies share more similarities with stocks than currencies. When you purchase some crypto currency, you are in fact buying some tech stock, a part of the blockchain and a piece of the network.
Bitcoin, altcoins, and forks
By now you would of heard of bitcoin and you might of heard of ‘altcoins.’ How this naming convention started was because back in the days of 2011, forks of Bitcoin appeared in the markets. The forks, or clones, all aspire to serve a niche area, aiming to be ‘better’ than Bitcoin. Since then thousands of new crypto varieties has emerged, eroding away at Bitcoin’s crypto market cap dominance. These altcoins are gaining market share at an alarming speed. Ten times or more growth has been observed in a time span as short as six weeks.
Check out how to buy Altcoins here using IOTA as an example
How to buy IOTA cryptocurrency
Coinbase and the other exchanges hold your crypto coins on the cloud in software wallets on their servers. However there have been hacks of crypto exchanges such as the Mt Gox hack in the past where people had their crypto currency stolen. If you are either holding a lot of crypto or want a more secure solution you can buy a hardware wallet to keep your crypto in.
I recommend the Ledger Nano S from Ledgerwallet.com
The ledger nano S wallet is specifically designed for storing crypto currency. You get a lot of features which are hard to find in any other type of crypto currency wallets, especially in terms of security and backup of your private key for the digital currency.
Ledge Nano S is not a plug and play type device. This means that you do not need to have a computer to use this wallet. The small LCD screen in the front of the wallet will allow you to operate your crypto currency wallet easily. It will allow you to do functions like transaction, exchange your digital currency, use the related apps and transfer money from one account to another account within seconds. The small size of Ledge Nano S will allow you to make it secure from the hackers or the thieves. Even in case of any lost; you can always get the backup and block the thief to get access to your crypto currency account.
For more info about Crypto Wallets check out my new post about understanding crypto wallets
Understanding Crypto Wallets