Bitcoin is on a steady climb towards it’s most recent all-time-high of $2700 but many newcomers might be surprised to learn that Bitcoin’s market cap of around $40 billion only makes up about half of the cryptocurrency market. Here’s a few tips to help you become aware of the opportunities available in the wide world of crypto.
- Check out CoinMarketCap to get a sense of how deep (and valuable!) the rabbit hole of cryptocurrency goes. I suggest clicking a few of the coins in the top five or ten and checking out their websites, especially Ethereum, to learn more about what technology each coin represents.
- Read the White Papers! They can get technical in spots but a skimming a good white paper should give you a sense of where a company sees itself in terms of what problem they’re solving, how they’re going about solving it, and who they’re connecting with to solve it. Here are the white papers of the current top five coins by market cap.
Download A Wallet
- Safety first! Hardware wallets like those from Trezor or Ledger are generally considered the safest but can be a bit pricey.
- Desktop wallets are less safe than hardware wallets but generally safer than mobile wallets or keeping money in online exchanges. I’m a huge fan of Exodus because it integrates ShapeShift, which allows you to exchange between several different coins within your wallet. I do recommend checking back once a month or so for updates.
Make An Exchange
Once you’ve downloaded a wallet to keep your coins in, now you can buy them from an exchange!
- Coinbase is the most popular U.S. exchange, allowing users to trade dollars for Bitcoin, Ether, and Litecoin through their bank accounts or via credit/debit card. The transactions take a week to process but you can see the exchange rate and associated fees at the time of purchase. Use my affiliate link and get $10 in Bitcoin after buying your first $100 worth of coin!
After receiving your coin you can store it on your hardware wallet or send it to your desktop wallet for safekeeping. If you bought Bitcoin on Coinbase and sent it to your Exodus wallet you can now exchange it for Ether, Litecoin, Dogecoin, Dash, Golem, or Augur.
- You could look into a bitcoin debit card or search for online retailers that accept cryptocurrencies. Many businesses do not take payments in cryptocurrency at this point but Japan recently announced that 260,000 retailers will start accepting bitcoin this summer, which will hopefully spur demand for other businesses to begin accepting cryptocurrency soon.
- You can trade, invest (hodl, as it’s called in the crypto community), or gamble, depending on the laws where you live.
- Don’t forget that exchanging currency does technically trigger a taxable event but the regulations governing cryptocurrency at this point can only be described as murky. Do your own research and keep careful records!
I’m not here to advise you on how to manage your cryptocurrency, just to let you know what’s available. It’s easy to imagine crypto-geeks balling out in cyberspace and doing all kinds of things with their bitcoins and other currencies but many of the users I’ve interacted with do little more than trade or invest, but for some it can be a life-changing decision. If you bought $100 of Bitcoin two years ago (June 5, 2015) at $225 you could now sell that investment for $1152.44.
In the meantime, have a great time learning about all these exciting projects and please don’t hesitate to send questions to firstname.lastname@example.org. If you found this useful please share and subscribe and have a great day!
Disclaimer: I’m not a financial expert; this is not and should not be construed as financial advice. Do your own research before investing and never risk more than you can lose!