How to invest in cryptocurrency

01.06.2021 12:56
How to invest in cryptocurrency

    In 2008, an anonymous crypto enthusiast Satoshi Nakomoto created the world's first decentralised electronic payment system based on blockchain - a chain of blocks of information protected by cryptographic encryption. The currency used in this system was called Bitcoin. Bitcoin was the first digital currency not tied to banks and payment systems that operated with fiat currencies. 

    In the ten years since its introduction, Bitcoin has become a popular and expensive cryptocurrency. Other cryptocurrencies, altcoins, have emerged based on the principles of bitcoin's creator's algorithm - no single issuing centre and cryptographic encryption. 

    When talking about high-yield assets, financial experts always mention cryptocurrency. 

    The benefits of investing in cryptocurrency are apparent even to novice investor. Digital virtual currencies are based on modern technology. Cryptocurrency can be used anywhere in the world. All you need for transactions is a network connection. Despite periods of decline, major cryptocurrencies are trending upwards. If you invest in cryptocurrency correctly, you can get a return on the difference between buying and selling rates. The cryptocurrency market is growing dynamically, with new financial instruments and new virtual currencies emerging.  Investing in cryptocurrency allows you to improve your wealth with a minimum of effort.


    Besides the steady growth of the exchange rate and new technologies, investors are also attracted to other advantages of digital virtual currencies.  

    Cryptocurrencies, or rather keys, public and private, are stored in cryptocurrencies. Transactions, transfers from and to the wallet, are visible to all users of the cryptocurrency network.  There is no data about the owner of the wallet, only the wallet number. Transfers in cryptocurrency networks are anonymous. Payments and transfers occur without the involvement and control of intermediaries represented by banks and other financial institutions. 

    The open code of cryptocurrency algorithms allows everyone to participate in the mining of cryptocurrencies. Cryptocurrencies are not subject to inflation, even though they can be mined by anyone in the market. The algorithm at the heart of cryptocurrencies prevents miners from mining more digital units than intended.  Cryptographic encryption protects cryptocurrencies from external interference, copying and unauthorised changes to the algorithm.


    Experts consider cryptocurrency as a highly profitable tool, but before investing in a digital currency, an investor should be aware of the risks involved in investing.

    The cryptocurrency market has been around for 10 years, but most national financial regulators have not defined an attitude towards cryptocurrencies. On the one hand, lack of regulation is positive for cryptocurrency market development, on the other hand, lack of laws leaves some countries' crypto investors without legal support and protection. National regulators can restrict or ban any cryptocurrency transactions in their jurisdictions at any time.

    Cryptocurrencies are highly volatile and fluctuations during the day can be quite noticeable. Without knowing the basics of how a purchased cryptocurrency works, it's easy for a novice investor to panic.

    Investing correctly in cryptocurrency largely depends on the investor. Knowledge, attention, quick decision making, and equanimity are the qualities that distinguish a successful crypto investor. Some crypto wallet owners have lost access to their funds due to carelessness, losing their crypto wallet password. Unlike an email password, a wallet password cannot be recovered or changed.

    The difficulty level of cryptocurrency mining has increased. A single miner cannot compete with mining pools, the giants of cryptocurrency mining.

    Investing in cryptocurrency has its downside, but a smart approach will avoid losses.


    The right approach to investing in cryptocurrency is to study the existing digital currency units in the cryptocurrency market. You need to choose a few stable cryptocurrencies whose purchase will not lead to losses. When choosing, you should assess how popular the cryptocurrency is, its availability on exchanges, and the reliability of protection of digital money from hackers.

     The top cryptocurrencies have positive characteristics on all of these counts.  Bitcoin is considered an investment leader. Investors refer to bitcoin as 'digital gold'. Over a decade, bitcoin has become the standard for altcoins. 

    There are three ways to invest in bitcoin:

    Buy on an exchange

    Participate in cloud mining

    Participate in trading.

    Using bitcoin as an example, let's look at each method in detail.

    Buying bitcoin on an exchange or exchange is the most affordable way to invest, the user simply exchanges euros for bitcoins. The cryptocurrency is kept in the wallet until the bitcoin exchange rate reaches the user's choice. After waiting for the desired exchange rate, the user sells the bitcoins and withdraws the fiat currency along with the profits from the rate increase.

    The method is simple, but waiting passively is not the best strategy, trading on cryptocurrency exchange will yield more income. To make money on a cryptocurrency exchange, a user needs to learn the basics of trading and keep up to date with the news of the cryptocurrency industry and global finance in general.

    Broex will help first-time investors in cryptocurrency. The service provides a risk-free, easy and convenient way to buy and sell major cryptocurrencies, withdraw money to a bank card, store funds directly on the platform or transfer them to your cryptocurrency wallet. The user-friendly interface will provide full information on the status of the user's portfolio and the market in general so that the user can keep up-to-date with the market situation and the status of their funds without any extra effort.

    The alternative to trading cryptocurrency is mining. The days of individual miners are over. Bitcoin mining is done by mining farms. Many farms rent out the processing power of the farm to ordinary users to generate extra income. The entry threshold is not high. A minimum lease costs just over $10. 


    Having decided to invest in cryptocurrency, you need to determine the initial investment amount and the funds required to support the activity.  Choose several cryptocurrencies. Create a crypto wallet to store the cryptocurrency. Choose a way to invest in and start the activity. It is recommended to keep the earned cryptocurrency in an offline crypto wallet. Do not keep large amounts of cryptocurrency in an online wallet or cryptocurrency exchange account unless you plan to sell or exchange the cryptocurrency shortly.

    Investing in cryptocurrency is a good chance to make money. You should use it while you have the opportunity.

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