In the previous post, we explored the first steps in getting into crypto. This was outlined in the importance of ensuring that you establish a secure platform with a reliable email client and setting up 2FA before even looking at the question of 'Should I Buy Bitcoin?' In this post, I will walk you through some of the ways that you can get your fiat currency into a digital form where you can use it to buy cryptocurrencies.
As much as you have a burning desire to know what I will have to say about your question 'Should I Buy Bitcoin?' I need to stress that this is by no means financial advice, I am not a financial advisor, and you need to do your own research. I can not take into account your specific circumstances with regard to this, and do not know what your financial position is.
Please ensure that you exercise appropriate due diligence before investing in cryptocurrencies, as they are still an immature market comparatively, and by nature more volatile than more mature markets. This is largely due to the relatively smaller volume of money moving through cryptocurrency markets. With that being said, these markets have grown consistently since emerging in the late 2000's.
How To Make Your Fiat Digital
If you are accustomed to dealing with cash, the process of converting fiat into a digital form can be a little perplexing. However, in many countries, people have been using EFTPOS and Credit Cards for quite some time. Making your fiat, or paper money, digital is as easy as depositing it into the bank.
Some websites will allow bank deposits into their bank accounts, for a fee, and this will then sit on your personal account that you have set up with them on their website until such time that you are ready to take the next step and buy your Bitcoin. Many websites offer other means to deposit your fiat, such as; wire transfers, BPay, and more.
However, before you get to this stage in your 'Should I Buy Bitcoin?' quest, I would suggest that you become familiar with the fees associated with the different ways to get your fiat onto the various websites. In the post Investing In Bitcoin - Why You Should Have Multiple On-Ramps, we explored some of those fees, and consider how much of a chunk they could take out of your portfolio if you don't know what you are doing. Take the time to review this post so you get a better understanding of how these movements can impact on your balance.
Some rules of thumb to follow with any account you set up as a part of your cryptocurrency portfolio strategy should include:
- Only use your Protonmail account when signing up for accounts on websites and exchanges.
- Ensure that the settings on all websites are switched to the most secure options possible including activation of confirmation emails for any funds moving on and off the site (where available).
- Always enable 2 Factor Authentication, preferably through an app such as Authy, or Google Authenticator rather than SMS.
Fiat on ramps and off ramps
Set up as many as possible in the beginning so you can easily move your money into crypto. This will also enable you to have more off ramps to get your money back into fiat when you are ready. You need to be positioned to move like a ninja, quickly, and almost silently.
Why Not Stick With Just One? This is a question that I get asked by my friends who are new to crypto, and honestly, this is a question that is firmly based in laziness, I'm not going to pull any punches with that statement or what I'm about to say here, it is what it is.
Don't be so bloody lazy with this step in the process, make the effort to give yourself more able to move. You could lose a lot of money if you drop the ball here!
You wouldn't build a house with just a single door to enter and exit, would you? What if you did, and there was a fire? How would you get out? That might sound dramatic, but in the case of a Black Swan event, if you only have one way in and one way out, in short, high chances are that you're stuffed! There's no point in even asking 'Should I Buy Bitcoin?' if you're not going to do this.
To give you some actual context that is relevant to the crypto space, what are you going to do in the event that there is an issue with the one and only site you have signed up for? In the bull run of 2017, many services were encountering heavy loads on their servers and had throttled the flow of new registrations.
It was not unusual for a Coinspot account to take as long as two weeks, and sometimes more, for approval! And that's with them being in full swing operation! You don’t want to find yourself in a situation where you need to move fast and there is a long waiting period on being able to move due to a lack of account establishment on your part early on in the piece.
Recommended on ramps and off ramps in my opinion include; Coinspot, Coinbase, Coinjar, and Cointree. Each of which has their own strong points, but you will need to decide for yourself which will best suit your needs. Investing In Bitcoin - Why You Should Have Multiple On-Ramps looks at some of the core differences between these and other sites.
Exchanges
To pick up your desires Altcoins and trade on the market, you’ll need to have accounts with various exchanges. There are many, and the prices between exchanges can vary, which may provide arbitrage opportunities. Some exchanges are better than others for a number of reasons, so choose the ones that offer what is most important to you; price, fees, support, accessibility, etc. Some exchanges to start with could include; KuCoin, Cryptopia, Binance, and Huobi.
Some exchanges you may choose to give a wide berth to and avoid will be for your own reasons. I strongly encourage you to find out what is being said in forums like Reddit and Bitcoin Talk about them at the time or registering, as the mood in the market, the ethical dealings, and matters relating to security can change over time.
One particular exchange I want to draw your attention to avoiding is YoBit. Read this article about their questionable background, and be cautioned that if you use this site there is a strong chance that you may lose all your money. At the time of writing, I’m still in the process of trying to resolve the issue that this post relates to, and have yet to have any response from Yobit (AKA in the crypto community as YoShit).
In the post What is the Best Trading Platform for Cryptocurrency, we take a closer look at some of these exchanges and what they have to offer. You may find that your preference is to move towards a decentralized exchange for the benefits that these have to offer.
This article was recenty posted on my website TechMagy and shared here with the Steemit community to add value.