How to start with cryptocurrencies
Assuming that you know the basics of the cryptocurrencies, some of the first questions you may have are: i) where can I buy/sell them and ii) where can I store them?
There is so much information online that the answers are multiple and maybe conflicting. Let’s start from the first point.
Where can you buy/sell cryptocurrencies?
For this, you need an exchange, where you can transfer money (or other cryptocurrencies) to perform buy/sell operations. These are two possible options:
- Gemini: easy to use, it currently supports Bitcoin, Ethereum, Zcash, and Litecoin
- Binance: it supports many cryptocurrencies, but unlike Gemini, you cannot send directly cash. This means that you can only trade one cryptocurrency versus another one.
Hence, you may first deposit money in Gemini and obtain, for example, bitcoins. Then you can transfer your bitcoins to Binance and trade them to buy other cryptocurrencies. But what if you just want to store the cryptocurrencies that you bought?
Where can you store your cryptocurrencies?
It is usually not a good idea to leave your cryptocurrencies in an exchange because they can be hacked. Hence, to store them, you need a “digital wallet”. There are 3 main types of wallets. Online, mobile, desktop, and hardware. Online wallets are not so safe, because an online service can always be hacked. Mobile wallets are phone application, so you need to be careful because if you lose/break your phone it may be an issue. Hardware wallets are the safest because you store your cryptocurrencies in a physical device. Desktop wallets are software that you can install on your computer, and they represent a good compromise. Here you have two examples:
- Electrum: safe and easy to use, it only supports Bitcoin
- Jaxx: it supports many cryptocurrencies, and it is also easy to use.
If you have questions, feel free to contact me!