How to invest in cryptocurrencies? (The Ultimate Beginner's Guide) #1

Investing in cryptocurrencies is now within everyone's reach. There are several ways to invest in cryptocurrencies. This will depend on your objectives, your starting capital and your knowledge of investing.

In fact, when we want to invest in cryptocurrencies, we must first have an image of all the options available to us. In this guide, we will see the main methods of investing in cryptocurrencies.

There are, in fact, several ways to do it. It's up to you to choose the one that suits you best, according to your capital, your objectives and your time horizon.

Subsequently, you can learn how to grow your cryptocurrencies. When trading, staking or even just by specializing in passive income. If any of the methods still seem “unknown” to you today, don’t worry. We’ll see that in the second part of this guide.

Now, we will focus on the first step: investing in cryptocurrencies. At the end of this guide, this will no longer have any secrets for you.

Investing in cryptocurrenciess in the long term (hodling)

Many people want to invest in cryptocurrencies for the long term. In crypto jargon, this is called "hodling". In fact, we write "hodling" and not "holding" because it is a spelling mistake that has become commonplace. A crypto investor made this mistake on a Reddit forum and it has since been picked up.

We are talking about hodling for a long-term investment in cryptocurrency. More particularly, this adapts to the fact of'buy bitcoin.

It is therefore the simplest way to invest in cryptocurrencies. All you have to do is buy some with euros and wait patiently.

This is the method chosen by beginners but also experts. In this method, you simply need to buy the crypto of your choice (like bitcoin for example) and store it.

You can resell at any time. Ideally, you do this when you take a profit. People resell when they gain 20% of their capital. Others are looking to double down. This will depend on your desires and your objectives.

What you have to remember is that the curves of cryptocurrencies are evolving. This is called market volatility. Even if during the 11 years of its existence, bitcoin experienced an exceptional rise, there were periods of decline.

(If it's Bitcoin that interests you, you can read our Guide to Bitcoin )

You have to know how to wait to sell at the best time to optimize your investment in cryptocurrencies.

🤌 We like this method because it’s the simplest. You buy a cryptocurrency (or several) and wait. This can be done over periods of months or years. You can even buy some to pass on as an inheritance. This is the most passive (and often the most profitable) method available.

Now you are wondering how to buy cryptocurrencies? Let's move on to the second chapter.

How to buy cryptocurrencies?

Again, there are several ways to buy cryptocurrencies. We're going to keep it as simple as possible here. In fact, what you need to remember is that there are two main families of platforms for buying cryptocurrencies.

👉 Centralized platforms: These are platforms that allow you to buy/sell and exchange cryptocurrencies. These companies will ask you for a copy of your identity card (scan). You do not have your own crypto keys. This makes the purchasing process very simple.

Note: Within platforms for purchasing cryptocurrencies, there are two main types of platforms. So, there are simple platforms where you can simply buy and sell cryptocurrencies. This is the case of the site Coinbase or Coinhouse, for example.

Then you have more complex platforms that allow you to buy, sell and trade cryptocurrencies. This is for example the case of exchange platforms like Binance, Kucoin ou Bybit.

👉 Decentralized platforms : These are called DEXs (for Dcentralized Exchange) There, these are platforms that work with smart contracts. This requires a certain level of cryptography. In this article, we will not talk about it because we are mainly aimed at beginners.

(For the others, we have a complete guide to understanding Decentralized Finance/DeFi).

So, to buy cryptocurrencies, all you have to do is go to what is called an exchange platform. This is where you can take your first steps with ease.

All you need is your bank card to buy cryptocurrency. In just a few clicks, you will be the happy owner of the cryptocurrency of your choice. Yes, it's exactly the same as if you bought a book on Amazon for example.

Now, the question to ask yourself: which platform to choose?

Which exchange platform to invest in cryptocurrencys?

There are many crypto exchange platforms now. Making your choice is not easy.

😳 Please note: : Many articles that explain how to buy cryptocurrencies (for beginners) refer to trading platforms. You will not buy cryptocurrencies there but CFDs. Be very careful with this type of article. Here, we show you sites to buy "real" cryptocurrencies.

However, for a beginner who wants to invest in cryptocurrencies, we recommend that you choose platforms that are controlled. Typically, if you are in France, the ideal is to choose platforms recognized by the AMF (Autorité des Marchés Financiers). It is this authority that will monitor the activity of platforms that are "Digital Service Providers" / PSAN.

In addition to this size criterion, it is important to check the fees, deposit methods, and reputation of the exchange platform.

We recommend these platforms to start your investment in cryptocurrencies. These are secure platforms and above all very easy to use. This does not require any technical skills, rest assured.

👉 The website Coinhous to (It's a French company). In fact, if you are just starting out and looking for security and simplicity, then Coinhouse is perfect for you.

👉Coinbase : It is the most famous platform of all and one of the oldest; You will have a wide choice of cryptocurrencies.

👉Binance : It is the first exchange platform in terms of exchange. It is essential in the cryptosphere. You can do a lot of things on the platform. It is very complete. However, it may require some time of adaptation for a complete beginner.

To buy cryptocurrencies on these platforms, nothing could be simpler. All you need to do is register with your email address. You can purchase them with several payment methods: credit card, bank transfer, etc.

In just a few clicks, you will have your cryptos in your account.

How to properly secure your cryptocurrencies

Now that you have purchased your first cryptocurrencies, the question of security must arise. In fact, depending on the person, the degree of security can depend.

In fact, every time you need to log in, you will be asked for the code that appears on your application. Thus, this provides additional security to the email you use.

Then, beyond that, you should also know that regarding cryptocurrencies, we speak of a “portfolio” or wallet in English.

The different types of wallets:

You need to be aware of the different types of crypto wallets :

• The hot wallet (wallet connected to the internet) : These are all digital wallets that are constantly connected to the internet. For example, having a crypto account on an exchange platform is a hot wallet. Even though technically these wallets are less secure, they remain the most practical to use. Indeed, the fact that your accounts are on centralized platforms and connected to the internet increases the possibilities of losses tenfold.

In fact, when you buy your cryptocurrencies, you will then have your wallet integrated into the platform. This means you will have a hot wallet.

Generally, once you buy cryptocurrencies on a platform, you transfer the funds to a cold wallet.

• Cold wallets (also called hardware wallet). These are the physical wallets. They look like improved USB keys in which you can store your cryptocurrencies. The security here is very strong because your cryptos are not systematically "connected" to the internet. They are stored on physical keys and there is no possibility of hacking. You are the one who holds the private keys to your cold wallet. This makes it a practice where all the responsibility belongs to you in the event of loss of your private key. (Your private key is the password made of letters and numbers that allows you to access your funds).

For a private key, we can recommend the Ledger key. It is the reference in the field and crypto users have been using it for years.

Finally, we can never emphasize enough on security and on properly protecting your crypto wallets.

Likewise, the use is very simple. All beginners can get acquainted with a Ledger wallet.

Moreover, there are equally reliable keys like the SafePal key developed by Binance. It's up to you to choose the one you prefer. They are more or less equivalent. All of them will keep your keys safe.

How to find cryptocurrencies to invest in?

It must be said that we cannot give you financial advice here. It's up to you to thoroughly research promising cryptocurrencies.

It is important at this stage to know the world of cryptocurrencies. Do some research, read up on blogs that talk about cryptocurrencies, and keep reading.

It’s still a new discipline, we’re all learning about it every day. There are a lot of fads in cryptocurrencies. Influencers can then create a strong social craze for a project. This is fleeting. Then, after the euphoria, you will see that these projects fall apart. Aim for long-term projects.

It is very important to know how to make a crypto fundamental analysis. In addition, knowing how to interpret the tokenomics is essential for a proven investor.

Here is a short video to help you:

The different ways to choose your cryptocurrencies

However, there are thousands of cryptocurrencies, it's not easy to find the next one that will explode and make you as rich as Croesus.

You can invest in bitcoin which is the first cryptocurrency in terms of market capitalization (Marketcap), certainly.

There are other promising cryptocurrencies like those working on the projects of the Web3. You can also invest in robust blockchains. We find Left (LEFT), Avalanches (AVAX), Algorand (ALGO) and many others.

Sometimes, some investors prefer to choose according to domains, such as metaverse cryptos or even invest in video games. Some people prefer to invest in games like DeFiLand, rain because they like to play at the same time.

Beyond the domain, there is also the fact of investing at the right time. Typically, as I write this ultimate guide to learning to invest, we are in a bear market. Now is an excellent time to invest.

The novice tends to want to invest during the Bull Run (rising period). Everyone rushes to buy when prices are at their highest. This is the classic error. Think about the opposite of what the crowd does. Yes, there are ICOs that were disastrous and completely failed....

You should know that sometimes, the big blows are made during ICO (Initial Coin Offering). These are the pre-investments to invest in projects in their early stages.

• -> How to buy a token during an ICO? Steps to follow
• -> How to invest in an ICO: 5 important criteria

Can we invest in crypto-related stocks on the stock market?

This is a relevant question. We often confuse investing in cryptocurrencies with investing in stocks linked to cryptocurrencies. It's very different, you know. However, this is another way to invest in cryptocurrencies, which is just as legitimate.

Therefore, certain investment funds will prefer this investment method. They will then build up shares of crypto companies listed on the stock exchange.

For example, here are the most well-known crypto stocks that we find:

• Nvidia (NASDAQ: NVDA): It is a company that builds Nvidia graphics cards. These are the cards that are mainly used for bitcoin mining. It is the world's leading producer of this type of card.
• Coinbase (NASDAQ: COIN): It is one of the most famous exchange platforms in the world. It is also one of the oldest. Its IPO caused a sensation.

Investing in ETFs

This is another way to invest in cryptocurrencies. We do not recommend it to people who do not have stock market knowledge. Here again you have to train and get information. Financial instruments are then more complex to understand than the simple purchase of cryptocurrency. This allows you to invest in cryptocurrencies indirectly.

You can invest, for example, in ETFs (index funds). It is a fund that follows the price of a financial asset. You may have heard of it. Recently, the IPO of the ProShares ETF was highly anticipated by futures investors. We then speak of future contracts because they follow price variations in the future. They are bought then sold at a given price and quantity, on a date anticipated from the purchase of the contract.

Should you trade cryptocurrencies?

Trading is a discipline that cannot be learned overnight. Trading and investing are certainly two close concepts but in practice very different. Many traders lose money. However, the gains can be greater, that's a fact.

There is a big difference between the crypto trader and investor. A crypto investor will rather be interested infundamental analysis of a crypto. A trader will instead focus on the charts and try to spot specific patterns. He will carry out many more transactions than an investor. This requires real work.

A trader who does not have the theoretical knowledge or practice would be like playing at the casino. Even if the gains can be tenfold, so are the losses.

Many traders opt for trading bots like the one of bitsgap. These are automated ways to generate profits without having to "trade" yourself. Trading bots are managed by algorithms that will carry out transactions automatically. Be careful, however, not to use them if you do not know what you are doing. The automated trading also requires a certain knowledge even if it is less.

–> Read our ultimate guide to Automated Trading

What are the taxes when you want to invest in cryptocurrencies?

Since 2020, all people living in France must declare their taxes and the crypto gains generated. Digital assets are indeed a new thing in income tax reporting.

In fact, if you have made capital gains (by selling and reselling cryptos), then you are taxable (beyond €305 of profit made).

The good news is that today there are crypto tax online sites very simple to use which calculate for you what you must declare.

The crypto tax software for your declarations are accessible to everyone. Here again, in a few clicks, you connect to your exchange platforms and the software does the calculation.

You must know that you are not taxable if you have not made your resales in FIAT currency such as dollars or euros for example.

So it remains quite simple. Then, the risks not filing your taxes are much more dangerous. It is therefore highly recommended to do so.

👌 We recommend the French site Koinly to declare your taxes easily.

Here's what you need to remember about your crypto tax return :

• Calculate the capital gain from a sale: sale price – [total acquisition price x (sale price / overall value of the portfolio)];
• Capital gains on crypto assets are taxed at a single flat tax of 30%;
• You must note the details of your added value on annex Cerfa-2086
• It is also imperative to declare accounts opened on platforms based abroad.

Final Word on How to Invest in Cryptocurrenciess

This ultimate little guide for beginners to learn how to invest in cryptocurrencies ends here. However, we must remind you that we have reduced the article here so as not to burden you with information. In each paragraph and in each chapter, there are elements that can be developed.

We invite you to subscribe to our newsletter to receive detailed articles and video tutorials. This is how you will strengthen your knowledge.

Do not hesitate to continue your learning by clicking on the internal links in each part. Browse this blog. It was designed for that 😉

Some cryptocurrencies to invest in:

It is good to know at least the cryptocurrency in which you want to invest (make a fundamental analysis or know tokenomics). Here is a selection of interesting cryptocurrencies:

• Invest in the crypto TRON (TRX)
• Buy the crypto UNI (Uniswap)
• Invest in the crypto MATIC
• La crypto link (Chainlink)

F.A.Q.

🖐 What are the most promising cryptocurrencies today?

Promising cryptocurrencies are the ultimate information that everyone would like to know. The world of cryptocurrencies is evolving rapidly. A promising cryptocurrency is one that has proven itself and has a future. We can cite BTC, ADA, AVAX, SOL, BNB or ETH. To do this, you will need to carry out your own research and fundamental analysis.

🖐 How to buy cryptocurrencies at low prices?

Brokers and exchange platforms have more or less the same prices for each cryptocurrency. However, depending on the platform fees and your payment method, costs may vary. However, we are talking here about a few cents difference, as a general rule.

🖐 Which cryptocurrency to invest in 2022?

For the year 2022, with the market going down, it can be a great year to invest.

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Note: No financial advice is given in this or any other article on zonebitcoin. This is information of which you are the sole judge and master. Be responsible with your investments and only invest as much as you are willing to lose.

Buy cryptocurrencies (the easy way):

• Public chat Binance (Complete crypto trading platform)
• Do Leveraged Trading: PrimeXBT.

Generate interest on your cryptocurrencies:

• Public chat Youhodler (Earn up to 12% interest)
• Public chat BlockFI (Generate cumulative interest) 

Secure your cryptocurrencies:

• On the wallet Ledger 
• On the wallet safepal

Entertain and play 

• The best for Esport and Bitcoin sports betting 
• Discover the reliable bitcoin casinos