Today, cryptocurrencies are in the news more than ever. Owing to the roller coaster like up and downs in price, and overnight millionaires, everyone is interested in learning how to buy Bitcoin — one of the most popular forms of cryptocurrency. Bitcoin is now widely accepted all around the world, is gaining popularity in the form of adoption as money, and has a growing number of applications. However, before you start exploring the world of cryptocurrencies and build yourself lots of wealth, you need to know where to buy and store your crypto assets.
Keep in mind that unlike traditional money which has a physical form, cryptocurrencies are entirely digital. Although there are some descriptive words like Bitcoin mining and wallets, the truth is, Bitcoin or any other cryptocurrency only exists as numbers in the ledger known as the blockchain. These coins get their value in the same way traditional money does — i.e. belief and trust and free market economics. Most coins also have programmed scarcity making most cryptocurrencies deflationary in nature as opposed to traditional money, which is inflationary by design.
Another important thing to remember is that as a first-time crypto user, you need to know how to store and handle your assets. There is a slight learning curve to this but as with most things in life, it gets easier with practice.
Let’s Get Started:
Buy a Wallet
The crypto world is full of examples of people losing a lot of money. Some lose because of market dynamics (FOMO buy and panic sell), and some by not securing their cryptocurrency holdings. A lot can go wrong if coins are left in the exchange after purchase. For instance, someone can hack into an account, or the whole exchange for that matter, and steal millions worth of coins. So, before you invest any hard-earned money in cryptocurrencies, choose a secure wallet for storing your coins. You can check out our guide on cryptocurrency wallets here. [Link to crypto wallet blog post]. A quick TL; DR — there are three major kinds of wallets and of them, a hardware wallet is the most secure kind and the only kind that people should use for cryptocurrency storage.
The easiest way of acquiring bitcoins or other cryptocurrencies is buying through an exchange. There is a slew of exchanges out there varying in reputation and feature sets. We prefer Coinbase but there are a other exchanges available and you can take a look at this exchange comparison site and decide for yourself. If you decide on buying some cryptocurrency, only invest an amount that won’t have a negative effect your finances. Please understand that there are financial risks to investing in cryptocurrency as the market is very volatile.
Another way of acquiring crypto is by offering products or services in exchange of cryptocurrencies instead of fiat money (USD, GBP, etc). This can be as easy as providing customers with your public key, or if you have a large operation, you can setup a merchant account with a cryptocurrency payment processor.
Transfer Your Assets to Your Wallet
As mentioned previously, never keep your crypto assets in an exchange or with a payment processor. Setting up a hardware wallet may take a few minutes but the security and peace of mind is worth every second spent. Once the wallet is setup, find your wallet address, go to the exchange or payment processor, and initiate the transfer; within a few minutes your wallet will update your balance and you will have successfully finished the transfer.
If you wish to use your cryptocurrency for day-to-day purchases, you have a couple of options. The most common method is to keep a majority of one’s asset in a hardware wallet and transfer a small amount into a software wallet on a smartphone. This is done because, one, it is considered best practice to store crypto assets in more than one location; and two, existing hardware wallets are very clumsy to use.
Although we agree on storage in multiple locations, we don’t think a software wallet is a good idea; sure, it’s convenient but not very secure. We have a better solution — Vault E. We designed Vault E to solve this dichotomy of hardware and software wallet. Vault E has a simple user experience at the core of its design. We wanted a hardware wallet that we can use to buy coffee or grocery or anything else with confidence and without hassle. And we think Vault E can do that.
So, before you take a dive in the world of cryptocurrencies, get yourself a hardware wallet and don’t forget to set it up. After you buy your first cryptocurrency, immediately transfer your coins to the wallet. And finally, when you are comparing and contrasting various hardware wallets on the market, consider Vault E. We promise we won’t disappoint!