In our previous article, we spoke about how crypto is one of the greatest gifts to give out this Christmas especially if you are unsure of what to give and you’d like to stick to a budget. In this article, we will take you through the steps to successfully purchase crypto for your loved one.
If you are a first-timer in the world of cryptocurrency, everything might seem a bit confusing, but by following these steps below, it becomes easier to navigate the crypto world. 1. Select the desired crypto exchange. The first item on your to-do list is to select the desired crypto exchange to be used. Crypto exchanges are platforms where traders (buyers and sellers) can meet to trade different sorts of cryptocurrencies. They typically have very low exchange fees and provide users with easy ways of trading. For a first-timer, the interface of an exchange might be slightly confusing however some exchanges often provide a “lite” version of their sites that are easier for users to navigate. The downside to using “lite” versions might be higher fees, hence to save more on costs, users typically need to learn how to trade properly on the standard trading versions. A typical exchange will provide information such as the real-time worth/performance of a coin and how much capacity is available to trade. Anyone well-versed in trading stocks might find it easier to trade crypto for the first time. For Africans, especially in jurisdictions where crypto is criticized, it’s best to ensure that the exchange you want to use allows for P2P trading or Fiat transfers with local currencies. Being unable to do so might result in an inability to withdraw/change your crypto assets into actual cash. The most popular exchanges are Binance & Coinbase. 2. Sign up on the exchange Once you’ve selected a choice crypto exchange, your next step is typically to sign up; that is, create and verify your account on the platform. Some exchanges will ask for personal information to verify your identity depending on how you intend to use the platform. This helps them to also prevent fraud and remain self-regulated. In some
cases, you might not be able to set up a trade without actually verifying your account first. Some verification requirements might include personal details such as a form of identity (an ID Card or a National Passport), and a picture (you might be required to take a selfie on the spot). Others might include your bank details, especially in cases where you will be involved in peer-to-peer transactions. 3. Make your first deposit & trade Once your identity is verified, you can start trading. To begin, you typically have to deposit to the exchange first. This can involve direct deposits from your bank account through transfers. With some exchanges, you will immediately be able to view your deposit in your account once the transaction is successful while others might take a while to get approved. Once the deposit is successful, then you can make your first purchase. Exchanges typically have a whole of cryptocurrencies to choose from. You can select from the very well-known ones such as CFX, BTC, ETH, DOGE etc to the typically unknown ones. Whichever choice you make, you can select the quantity based on the amount of deposit you have. You do not have to use up all of your deposit to make an order. Just like stocks, you can determine how much you’d like at a particular time. You need to beware of risks, such as in a bearish market where the prices are down so you don’t lose money. Also when purchasing, some coins such as Bitcoins are very expensive to purchase 1. 1 BTC as of November 2022 is equal to 16,430.50 USD. You might have to purchase a fraction of it to own especially for the first time depending on your budget. 4. Select your desired storage method Your next step is to select your desired storage method for your purchases. Exchanges are usually well equipped with adequate storage to prevent theft or loss of assets. They often come with specialized wallets that are only accessible to you alone which sometimes have a private key. Sometimes, if you misplace your private key, you can lose all of your assets. It’s often best to store your assets on your selected exchange. If you would rather have another location, you can also explore options such as a hot or cold wallet. This might typically cost more. Hot wallets are wallets stored online with internet-connected devices. It’s high-risk since it’s still accessible on the internet for
hacking. Cold wallets on the other hand aren’t connected to the internet and assets are stored on a hard drive/USB. It typically needs a code and if that goes missing you can lose your asset. If the device is stolen or breaks or stops working, you can also lose your assets.