Electronic money, also known as digital currency, is a unit of currency that operates on electronic systems and is stored on the Internet, computer systems, smartphones and payment cards.
Cryptocurrencies allow instant transactions that can be done seamlessly. Cryptocurrencies issued by the Government are known as fiat currencies. Non-fiat electronic money is called digital currency. Cryptocurrencies (most notably Bitcoin) are a subset of cryptocurrencies.
Buy Bitcoin and Other Cryptocurrency
Find a Reputable Exchange to Buy
There are many ways to buy cryptocurrency, though the most accessible method for beginners is likely to be a centralized exchange. Centralized exchanges act as a third party overseeing transactions to give customers confidence that they are getting what they pay for. These exchanges typically sell crypto at market rates, and they make money on fees for various aspects of their services.
For more advanced users, there are decentralized exchanges whose fees can be lower than those charged by centralized platforms. Those can be more difficult to use and demand more technical know-how, but they may also offer some security benefits because there is no single target for a cyberattack. Cryptocurrencies can also be traded through peer-to-peer transactions.
The easiest way to acquire cryptocurrency is to purchase on an online exchange like CoinMarketCap.
On CoinMarketCap, you can buy major cryptocurrencies like Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH), Bitcoin Cash (BCH), Ethereum Classic (ETC). Or you can explore emerging coins like Stellar Lumens or EOS. For some cryptocurrencies CoinMarketCap offers opportunities to earn some for free.)
Choose the Method you Want to Pay
While there are thousands of cryptocurrencies being traded around the world, you'll find that the most popular options are widely available for purchase in fiat currencies such as the U.S. dollar. If you're a first-time buyer, you'll very likely have to use regular money to buy cryptocurrency.
If you're a more experienced investor, you may want to trade some of your existing crypto holdings for another type of cryptocurrency - for instance Bitcoin for Ethereum.
Add Value to Your Account for Payment
Depending on how you choose to pay, you may have to fund your account before purchasing any crypto. If you're using fiat currency, most exchanges allow debit and bank transfers. Some also allow you to fund a purchase with your credit card, though this can be a risky move with a volatile asset like cryptocurrency because interest costs can deepen your losses if your investments decline in value.
If you already own cryptocurrency, you can transfer it into your account from a digital wallet or another platform, then use it to trade. Just be sure to verify that your crypto exchange allows trading between the assets you're looking at. Not all cryptocurrencies can be directly traded for one another, and some platforms have more trading pairs than others.
Select a Cryptocurrency
There are many options for cryptocurrency investors, though there are none that are likely to be right for everyone. Before you buy, ask yourself what your goals are for this investment. Are you hoping it will increase in value? Are you interested in carrying out transactions using cryptocurrency? Are you interested in using the underlying technology via decentralized apps?
How Do you Store Cryptocurrency?
Storing crypto is similar to storing cash, which means you need to protect it from theft and loss. There are many ways to store crypto both online and off, but the simplest solution is via a trusted, secure exchange like CoinMarketCap.
CoinMarketCap customers can securely store, send, receive, and convert crypto by signing into their account on a computer, tablet, or phone.
Want to transfer money from your wallet to a bank account? The CoinMarketCap app makes it as easy as transferring funds from one bank to another. (Much like conventional bank transfers or ATM withdrawals, exchanges like CoinMarketCap set a daily limit, and it might take from a few days to a week for the transaction to be completed.
Pros and Cons of Cryptocurrency
Pros
Supporters see cryptocurrencies such as Bitcoin as the currency of the future and are racing to buy them now, presumably before they become more valuable.
Other advocates like the blockchain technology behind cryptocurrencies, because it’s a decentralized processing and recording system and can be more secure than traditional payment systems.
Some cryptocurrencies offer their owners the opportunity to earn passive income through a process called staking. Crypto staking involves using your cryptocurrencies to help verify transactions on a blockchain protocol. Though staking has its risks, it can allow you to grow your crypto holdings without buying more.
Cons
Many cryptocurrency projects are untested, and blockchain technology in general has yet to gain wide adoption. If the underlying idea behind cryptocurrency does not reach its potential, long-term investors may never see the returns they hoped for.
Those wild shifts in value may also cut against the basic ideas behind the projects that cryptocurrencies were created to support. For example, people may be less likely to use Bitcoin as a payment system if they are not sure what it will be worth the next day.
The environmental impact of Bitcoin and other projects that use similar mining protocols is significant. A comparison by the University of Cambridge, for instance, said worldwide Bitcoin mining consumes more than twice as much power as all U.S. residential lighting. Some cryptocurrencies use different technology that demands less energy.
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