How to invest in crypto as a beginner

Investing in crypto can be an exciting prospect. For beginners, the stories of Bitcoin millionaires made rich in the first wave of Bitcoin adoption incite intrigue and curiosity. Crypto experts and analysts still believe there’s an opportunity for significant gains if investors make the right moves at the right time. The great thing about investing in crypto is that it offers a diverse market, with different assets such as altcoins, meme coins and tokens to choose from, each with its own protocol, purpose and origin story. But before you invest in crypto, the most important thing is to understand the risks involved in buying a digital asset that forms part of a highly volatile market. While some may have made a lot of money from investing in crypto, others have also lost. 

Before making a decision as to which crypto, how much, when and how, read this article to find out a bit more about how to invest in crypto as a beginner, and research the cryptocurrencies in question as much as you can, and always remember, never invest more than you are willing to lose. Let’s jump in.

Investing in crypto: The basics

While cryptocurrency has been around for around 15 years, it is only in the past decade that crypto has really started making waves and headlines. This has prompted many people to investigate crypto further, either for investment purposes or to learn more about crypto’s primary function as a digital or virtual currency, a decentralized way to store and transfer value. Each crypto transaction is securely recorded on a public ledger, known as the blockchain, using cryptography, making it nearly impossible to counterfeit. 

This underlying blockchain technology is a decentralized, publicly accessible register that records all transactions across a network of computers, ensuring transparency and security. Some of the most popular cryptocurrencies include Bitcoin, Ether, Solana, Litecoin, as well as stablecoins such as USDT and USDC, the value of which are pegged to a centralized currency, such as U.S. dollars, offering a more “stable” asset and means of payment. As a virtual asset, cryptocurrency is stored digitally in what’s logically known as a wallet, which can be “hot” (online) or “cold” (offline), each offering their advantages and disadvantages regarding security and convenience.

Invest in crypto as a beginner

The first thing you need to decide when investing in crypto as a beginner is which exchange you will use to buy your cryptocurrency. There are numerous exchanges available on the market, but it is important to choose one that has a solid reputation, reliable security features such as two-factor identification, and a user-friendly interface that makes it easy to watch how your investments are performing. You will also need to consider the fees associated with buying and selling crypto, which can vary between one exchange and another. Some exchanges also offer a wider variety of cryptocurrencies, and therefore might charge more for their service. 

Once you’ve selected an exchange, the next step is to set up an account and complete the required verification processes. This often involves providing identification documents to comply with regulations. Once your account is ready, you can fund it with your preferred FIAT currency (dollars, euros, pounds etc.) and start investing in crypto. Always start small to minimize risk —no more than you are willing to lose. As a beginner in crypto, it is a good idea to watch how your crypto performs for a couple of months to help get used to market movements. 

Managing your crypto

Managing your investments effectively is crucial when you invest in crypto as a beginner, especially given the volatility of the market. First of all, start by setting clear investment goals, whether you aim to hold your assets long-term or engage in more active trading. Having a defined strategy will guide your decisions. When you invest in crypto as a beginner, it’s important to be prepared for sudden price fluctuations and avoid making impulsive decisions based on short-term market movements. 

To manage risk, consider diversifying your portfolio by investing in a range of established cryptocurrencies and interesting altcoins with promising protocols. Staying informed is equally important. Follow reliable crypto news sources, join online communities and learn about market trends and developments. This ongoing interest and active involvement in your crypto investment can help raise awareness of when to adapt your strategy, ultimately leading to informed decisions that help bypass risk and increase fruitful investment opportunities. 

To learn more about how to invest in crypto as a beginner, crypto as a form of payment, and how, as a merchant or business, to accept crypto payments from your customers, visit www.forumpay.com, or get in touch with our sales team to discuss any questions you may have.

This article is for general interest purposes only. It does not aim to educate, and does not constitute financial or investment advice.