A cryptocurrency is a virtual currency: this means that it does not exist physically, but only online. Recently, the interest in investing in cryptocurrencies has increased at a breakneck pace. We will try together to understand how cryptocurrencies work and how to invest in them safely.
How do cryptocurrencies work?
Cryptocurrencies can be transferred to anyone on the internet without the need for an intermediary, such as a bank. They can also be used to pay worldwide, without any restrictions. It is important to keep in mind that the course of bitcoins is constantly evolving. In other words, if you want to invest in a cryptocurrency, you should be aware that it could be worth thousands of dollars today and only hundreds of dollars tomorrow. If the value falls, there is no guarantee that it will rise again soon, so be aware of the risks.
How to buy cryptocurrencies?
You can do this with a credit card or, in some cases, through a process called “mining.” Thus, users can easily buy bitcoins and other cryptocurrencies using a wide variety of payment options. As such, KuCoin accepts a wide variety of currencies and allows you to easily buy cryptocurrencies. Once your purchase is complete, we will deposit your new cryptocurrency directly into your KuCoin wallet, an easy and secure way to manage your cryptocurrencies.
What is Bitcoin?
When we talk about cryptocurrencies, we are talking about bitcoin. It is the first implementation of the cryptocurrency concept and the first peer-to-peer decentralized payment network powered by its users. That is, it is not subject to any central authority or intermediary. Bitcoin is also a consensus network that enables a fully digital currency and payment system.
Why do users invest in cryptocurrencies?
Interest in buying cryptocurrencies has increased by 300% in the past year and internet searches for “buy bitcoin” by 200%. How to explain this phenomenon? Today, bitcoin investors want complete control over all their transactions. In addition, the technology blockchain the foundation of bitcoin and other crypto currencies has several features that make it an interesting investment, here are some of them:
1. Increase Profits
Cryptocurrencies have proven to be a good alternative to protect its users’ money, due to the loss of value of most other currencies. They make it possible to increase their income as they generate passive income. For example, thanks to its fully automated trading solutions, KuCoin makes it possible to generate money automatically by offering wealth management services.
2. Increased safety through technology blockchain
The technological system used by cryptocurrencies is much more secure as it is a fully encrypted procedure and the information can only be decrypted by the sender and receiver using a code that only they possess. In addition, it is a universal currency and can be used for transactions anywhere in the world unless its use is restricted.
3. A project full of promise
Bitcoin was the first cryptocurrency to appear in 2008 and since its inception, early investors investing in digital currencies have benefited immensely from its rising price over time. Therefore, it shows us that investing in cryptocurrencies is a great opportunity to make a profit, albeit in the long run.
Is it safe to invest in cryptocurrencies?
Cryptocurrencies are not supported by the government like bank deposits. This means that cryptocurrencies stored online do not enjoy the same protection as money deposited in a bank account. In the cryptocurrency market, various tools and services can be built in a decentralized manner. This is exactly where the transparency of the process comes from. For added security, the exchange, which is fully digital, uses strong cryptography to secure transactions, control the creation of additional units, and verify asset transfers using distributed record technologies.
How to invest in bitcoins and cryptocurrencies?
1. Decide what type of cryptocurrency you want to invest in
The first step in knowing how to invest in bitcoins is to decide which cryptocurrency you are most interested in based on the questions mentioned in the previous points. There are thousands of different cryptocurrencies and the total value of all these coins is about $1.7 trillion. Today, the KuCoin platform alone offers 540 cryptocurrencies and is therefore a pioneer in cryptocurrencies exclusives.
2. Choose where to invest
As with any procedure, it is essential to plan, set goals and determine the amount you want to invest. Once this decision has been made, it is important to think about the best time to make the investment.
3. Buy a cryptocurrency wallet
There are different types of wallets and each one is for a different type of cryptocurrency. Choose well!
4. Join an exchange network
Once you have a wallet it’s time to join an exchange as that’s where the trades will take place.
5. Buy cryptocurrencies
If you already have a wallet and an exchange account, you can now buy cryptocurrencies. These can be purchased on the website of any cryptocurrency or specialized platforms, such as KuCoin.
We have seen together how cryptocurrencies work and how to invest. However, remember that cryptocurrencies are not regulated by any institution, leaving you solely responsible for what happens to your money. To prevent possible fraud, you can take certain measures, such as activating two-factor authentication (2FA). In particular, this is the promise of KuCoin. Once your account has been created, you will need to enter your password and then a unique and temporary code that will be sent directly to your mobile phone. No one can access your account without your permission.