Cryptocurrencies are well-known to be as India’s investing scenario. With hopes of high returns, most investors are now flocking toward Cryptocurrency. The past high returns have made Cryptocurrency an attractive investment in the country.
India is becoming one of the highest cryptocurrency holders in the world, having 100 million investors. It is a known fact that cryptocurrency has a good number of investors compared to the whole equity market. At present, there are thousands of cryptocurrencies available in India.
This blog will help you to know how to invest in Cryptocurrency.
What is meant by Cryptocurrency?
Cryptocurrency is defined as digital money that is held as tokens or virtual coins. You can make use of Cryptocurrency to buy and sell anything, like digital payments. However, the business or the person must accept Cryptocurrency for the services or products they are selling.
Digital payments and cryptocurrencies differ in their technology and the asset they depend on. Moreover, unlike the Indian rupee, cryptocurrencies do not have a physical presence. It means there is no way you can do physical transactions with cryptocurrencies.
Nowadays, there are thousands of cryptocurrencies available for you to buy and sell things using them. Here are a few examples of cryptocurrencies: Ripple, Bitcoin, Ethereum, DogeCoin, Litecoin etc.
How does Cryptocurrency work?
Most financial transactions depend on third-party institutions such as financial institutions or banks for processing electronic payments. However, these transactions have their limitations. In order to overcome those hurdles, an electronic payment system evolved based on cryptography.
Most of the cryptocurrencies are made as a peer-to-cash network which means they can cut off the need for a middleman such as regulatory bodies and banks while making payments. With cryptocurrencies, you can pay directly to others. These cryptocurrencies are virtual, and they do not have a physical form. There is no chance of having physical delivery of cryptocurrencies, unlike cash.
Blockchain is a technology through which all cryptocurrencies are created and managed. Using Blockchain, every transaction is authenticated and authorized by the owner. With Blockchain, people can record every transaction between two parties. It can allow for a transparent, secure and trackable system that ensures smooth Cryptocurrency.
What is meant by Bitcoin?
Bitcoin is a type of digital currency or Cryptocurrency that was launched in 2008. There is no physical form for it and its transactions are verified using online nodes. Bitcoins mostly depend on a set of private and public keys that help in protecting both the payer and payee. The private key is an email password, whereas the public key is an email address. These keys protect access to a person’s Bitcoin and can be well-guarded.
How can I invest in Cryptocurrencies through trading platforms?
The demand for cryptocurrencies is skyward in India. Here are the steps to follow to invest in cryptocurrencies:
- Complete your KYC process by making an account on a crypto trading platform like CoinTrade.
- Make a crypto wallet to store all the digital tokens and coins that you buy.
- Connect your digital wallet to your bank account. This can help you save your money and withdraw it whenever you sell.
- After putting your money into the digital wallet, you can now easily buy any cryptocurrency on the platform. Depending on the order value, the money will be debited automatically from the digital wallet.
- After the successful transaction, your digital wallet will show all the coins and tokens you buy. You can easily sell them anytime, take out the money and credit it into your bank account.
What are the types of cryptocurrency wallets?
There are two types of cryptocurrency wallets, such as:
- Software wallets: Software wallets are completely based on desktop programs or browser extensions that can allow crypto investors to send, invest and receive cryptocurrencies. Sometimes, these are referred to as “hot” wallets, as the funds are online without having any specific key. Software wallets do not support trading in numerous currencies; they are very much specific to some particular currencies. In India, almost all the crypto platforms work on the software wallet principle.
- Hardware wallets: There are many external devices to store cryptocurrencies for safe use anywhere and anytime. If you are an investor who wants to purchase cryptocurrencies, you should first store them in hardware wallets. It is because hardware wallets are considered safer than software wallets as they have private keys that the investors can access. Based on the web-based interface, you can make use of hardware wallets.
Conclusion:
Still, cryptocurrencies are considered to be a controversial topic. There are no particular rules for the cryptocurrency framework, leading to many scams and cyberattacks. With the new-age crypto trading platforms, investing in cryptocurrencies is becoming quite easy. If you have any queries regarding Cryptocurrency, contact CoinTrade.