<h3>Cryptocurrencies are a well-known entity in today’s financial system. Over the past decade, these have evolved from being speculative to disrupting traditional finance. Investing in crypto, such as Bitcoin, Ether, and Matic can be easy if you know how the market works.</h3><h3><br></h3><h3>The original and oldest cryptocurrency was Bitcoin, which was introduced as a form of peer-to-peer payment in 2008. It was introduced by a pseudonymous group or person called Satoshi Nakamoto to solve the inefficiencies of traditional finance.</h3><h3><br></h3><h3>The evolution of Bitcoin from a mere speculation in 2009 to an asset of value now is a phenomenal feat. To put things into perspective, as of October 2022, Bitcoin’s market capitalization is close to $400 Billion! This is almost equivalent to the current market cap of the financial giant Visa.</h3><h3><br></h3><h3><strong>What’s in this blog:</strong></h3><ul><li>Is crypto an asset class</li><li>Getting started and buying your first Ether, Matic, and other cryptos</li><li>Buying your first crypto with USD or other currencies</li><li>Storing your crypto</li><li>DYOR</li><li>Managing the risk</li><li>Closing thoughts</li></ul><p><br></p><h3><strong>Is crypto an asset class?</strong></h3><p>The recent coronavirus pandemic showed us the importance of diversification. The fall across different asset classes was different, and so was the subsequent recovery. Global banking giants such as Goldman Sachs, JP Morgan, and several others are actively offering crypto services to different clients.</p><p><br></p><p>Cryptocurrencies have evolved to be an asset class with a high Sharpe ratio as compared to other asset classes. It implies that it has the potential to generate the same returns for a lower amount of risk.</p><p>It is crucial to understand that cryptos are not a highway to quick wealth. It is essential to understand that most investments inherently have a risk associated. And being a relatively new asset class, the risks are much higher.</p><p><br></p><h3><strong>Getting started and buying your first Ether, Matic, and other cryptos</strong></h3><p>Do Your Own Research or DYOR is one of the vital aspects of being a crypto investor. This is true for any investment across the financial markets. Before buying your first crypto, have a clear reason in your mind as to why you’re investing your money in that particular asset.</p><p><br></p><p>Market participants can transact in cryptocurrencies directly through the crypto exchanges. There is a major difference between the functioning of stock markets and crypto markets.</p><p>In stock markets, trades are placed on the exchanges through brokers. In the cryptocurrency markets, transactions can directly happen on an exchange. A lot of regulations apply to stock exchanges. Every nation has a central authority that controls the stock markets. Exchanges for cryptocurrencies do not, however, follow such strict rules.</p><p><br></p><p>Crypto exchanges can be classified into centralized and decentralized exchanges. The term "centralized exchanges" refers to those that are controlled and owned by a single entity, such as Coinbase. If the company is publicly traded, it is required to follow regulations and provide required disclosures. Due to its NASDAQ listing, Coinbase is required to submit regular reports to the SEC.</p><p><br></p><p><em class="ql-size-large">Regarding trading volumes, Binance is the largest cryptocurrency exchange in the world.</em></p><p><br></p><p>Decentralized exchanges are another option. And this is where cryptocurrency exchanges and stock markets differ significantly thanks to blockchain technology. Exchanges that are not owned, controlled, or administered by a single body are said to be decentralized exchanges. The term "DEX" also applies to these decentralized exchanges. Participants simply exchange tokens with one another during transactions that take place directly on the blockchain; there are no middlemen in this process. <a href="https://uniswap.org/" rel="noopener noreferrer" target="_blank" style="color: rgb(107, 36, 178);">Uniswap</a>, <a href="https://pancakeswap.finance/" rel="noopener noreferrer" target="_blank" style="color: rgb(107, 36, 178);">PancakeSwap</a> are some of the popular decentralized exchanges.</p><p><br></p><h3><strong>Buying your first crypto with USD or other currencies</strong></h3><p>A centralized exchange allows you to buy crypto with fiat currency. Because there are so many options out there, you can find yourself looking for a good exchange. Here are a few considerations before finalizing a crypto exchange.</p><ul><li>Security of the crypto exchange</li></ul><p class="ql-indent-2">Security and trust are two of the most important challenges in any industry. Prior to listing tokens, the majority of the best-centralized exchanges perform due diligence. Exchanges may therefore be in charge of preventing frauds like pump and dump. It is wise to stick with transactions that have been legal and reliable for a while.</p><ul><li>Purchasing crypto using a debit or credit card or bank account</li></ul><p class="ql-indent-2">Different crypto exchanges permit different ways to purchase cryptocurrency. While some exchanges allow credit and debit cards, others only accept bank transfers and PayPal.</p><p class="ql-indent-2">You may occasionally discover that some exchanges do not accept your preferred method of payment. Say you wish to purchase cryptocurrencies using PayPal. The only exchanges that let you do that are say FTX and KuCoin. Additionally, KuCoin has a far bigger trading volume than FTX. You choose KuCoin because you realize it is the more reliable exchange.</p><ul><li>Token listings in crypto exchanges</li></ul><p class="ql-indent-2">Typically, all major exchanges would list the most popular tokens. On occasion, though, you can discover that the token you were looking up is listed on an exchange that might not have the largest trading volume.</p><ul><li>Geo-specific crypto exchanges</li></ul><p class="ql-indent-2">There are various geo-specific features on some exchanges. Some exchanges don't provide their services in certain regions.</p><p><br></p><h3><strong>Storing your crypto</strong></h3><p>As with any valuables such as money, credit cards, etc., cryptocurrency such as Bitcoin, Ether, Matic, and others can be stored in wallets. These special types of wallets are called cryptocurrency wallets. Depending on the characteristics, these crypto wallets can be classified into different types. These are:</p><p><br></p><p><strong>Hot wallet:</strong> These are always connected to the internet and are more user-friendly. Being connected to the web 24*7 makes them less secure overall. Because they are simple to set up, they are particularly adaptable for traders and frequent users.</p><p><br></p><p><strong>Cold wallet:</strong> These are less vulnerable to online fraud because they are stored offline and do not require internet connectivity. They are ideal for HODLers due to their risk-averse character.</p><p>Few varieties of cold wallets can connect to the internet while still functioning in their most basic capacities. It follows that those who have a lot of cryptocurrency assets favor cold wallets over hot wallets.</p><p><br></p><h3><strong>DYOR (Do your own research)</strong></h3><p>This extremely popular acronym in the crypto ecosystem stands for doing your own research. You need to be somewhat committed and patient when doing your own research. If you plan to invest or trade in cryptos beyond the blue chips of cryptos, you would need to carefully evaluate the different parameters.</p><p><br></p><p>The first deciding aspect while conducting project research is market capitalization. Projects with small market capitalization are typically more susceptible to price manipulation. The exchange you choose is important when investing in altcoins. Checks and balances are less strict when it comes to listing new coins on less well-known exchanges. It makes it simple to list arbitrary projects. Giving in to these schemes would probably result in the funds being wasted.</p><p>GitHub is a fantastic tool for tracking the advancement of any project. Also, any cryptocurrency project must observe and evaluate social and community participation because decentralization is at the core of all successful cryptocurrency projects.</p><p><br></p><p>Finally, evaluating the whitepaper is crucial to determining any good crypto project. It might take some time to complete this action. But it is definitely worth the time and effort.</p><p><br></p><h3><strong>Managing the risk</strong></h3><p>Diversification is a crucial aspect of any investment. We might have often heard the phrase about not putting all your eggs in one basket. <a href="https://www.neoncoins.com/earn" rel="noopener noreferrer" target="_blank" style="color: rgb(107, 36, 178);">Diversification in crypto investments</a> can have different forms. Some of these are:</p><ul><li>Diversifying based on the blockchain technology</li></ul><p class="ql-indent-2">Blockchains come in a wide variety of forms, each with specific advantages.</p><p class="ql-indent-2">For instance, Proof of Stake (PoS) blockchains are less battle-tested but more efficient. Whereas Proof of Work (PoW) blockchains are more energy-intensive and slow. These are simply the two most well-known blockchain types; there are many more. Nobody can predict which blockchain technology will have the biggest impact on the decentralization movement. To maximize your chances of success and get exposed to all of the many blockchain varieties, you can diversify based on those.</p><ul><li>Diversification of crypto investments across different platforms</li></ul><p class="ql-indent-2">You should always distribute your assets around exchanges in several regions. Your assets on other platforms will be protected even if one exchange is hacked or shut down. Ensure the security of your private keys. You won't be able to access your assets if you misplace your private keys. They won't be retrievable in any form. You can save your private keys in an encrypted file on your computer or in a hardware wallet to keep them secure. Avoid holding all of your valuables in one wallet as the third step. Since all of your possessions would be lost if you lost that wallet.</p><ul><li>Understanding the impact of volatility on the crypto market</li></ul><p class="ql-indent-2">Demand and supply imbalances, fundamental modifications to the crypto project, news, etc. are just a few of the factors that could generate volatility in the cryptocurrency markets.</p><p class="ql-indent-2">It is crucial for you to "not" respond based solely on pricing changes but rather go further into the factors that contributed to them and take appropriate action.</p><p class="ql-indent-2">For instance, you should take the required precautions to safeguard yourself from the potential harm it can cause to your portfolio if a crypto project undergoes a fundamental transformation. However, until it is confirmed, a rumor in the press might not be cause for concern.</p><p><br></p><h3><strong>Closing thoughts</strong></h3><p>Cryptocurrency trading or investing can be tricky if done with half-baked knowledge. Before testing the waters with actual money, you should study and <a href="https://www.neoncoins.com/crypto/bitcoin" rel="noopener noreferrer" target="_blank" style="color: rgb(107, 36, 178);">analyze the markets</a>. Then test your understanding of the crypto market on platforms such as Neon Coins for free.</p><p><br></p><p>Once you feel confident in your understanding, you should have a long-term goal in mind. Time spent in the crypto market would almost always bear a sweeter fruit than trying to time the market.</p>

<h2>Getting started with investing in cryptocurrency is about understanding the market fundamentals. Hone your skills and get started with buying your first crypto.</h2>