By now you have probably seen the word “crypto” circulating on the web, or even heard about it from a friend. Cryptocurrency has been gaining popularity amongst people all over the world, from big-tech billionares to regular folks – and there’s good reason why.
It can feel a little overwhelming if you’re just starting to dive in, but we’re here to help break it down for you:
What is Cryptocurrency?
Cryptocurrency is essentially digital money (that’s right – there’s no physical form) with a number of innovative characteristics that make it unique – which we’ll get more into later.
A few popular cryptocurrencies you may have heard of before are Bitcoin, Ethereum, and Dogecoin. They can be used to store and transfer value, make payments, or reward activities within their networks.
How Does Cryptocurrency Work?
Most cryptocurrencies are decentralized, meaning that instead of one entity – such as a bank – having power or control over your assets, it is distributed across a network. This concept is where we get the term decentralized finance, or DeFi. DeFi allows us to have true peer-to-peer transactions with no central entity involved who may be benefiting from your transactional fees.
You may be wondering how this is possible – and the answer is through blockchain technology. A blockchain is a secure online database that doesn’t require oversight from outside entities (like banks or governments), and in the case of cryptocurrencies, it’s the primary place where transaction records are stored. Cryptocurrency blockchains are also open to public review, so transactions can be monitored for any fraud or errors that may occur.
So, what are the advantages of crypto?
Cryptocurrency transactions can take place globally, don’t require your personal information, are completely transparent, and give users full control over their assets.
Is it Safe?
It’s important to keep in mind that just like any investment, cryptocurrency comes with its own risks. Here’s what you should know before getting started:
You are responsible for securing your own funds. Lost passwords or sending to the wrong address could result in losing funds.
Regulations are still evolving. Sudden policy changes could impact prices.
Platforms may experience technical issues or exploits.
With this in mind, you can begin to explore crypto safely.
How to Buy and Sell Cryptocurrency
When it comes to buying and selling your crypto, there are many trusted sources you can use, such as Coinbase, Binance, and Kraken.
To get started, you’ll want to:
Sign up for an exchange account and complete identity verification
Connect your bank account or debit/credit card
Place buy/sell orders for your chosen cryptocurrencies
Be sure to enable two-factor authentication and other security features and you’ll be good-to-go.
How to Store Cryptocurrency
Storing your crypto works similarly to how you store your physical cards – in a wallet. And as you may have guessed in this case, cryptocurrency wallets are digital.
There are two types of wallets for storing cryptocurrency:
Software wallets - Apps downloaded onto your device
Hardware wallets - Physical devices that store crypto offline
Wallets keep your account information encrypted and anonymous, which provides an extra layer of safety.
Staying Safe
Just like in any financial space, there are scammers, fraudulent currencies, and phishing techniques to watch out for.
Here are some tips for minimizing risk:
Be wary of "free" token offers asking for your wallet keys
Use trusted apps and browsers to avoid phishing sites
Do not connect your wallet to any website without checking the domain name carefully
Never share wallet passwords or keys publicly
Enable wallet security features like whitelisting
Spread holdings across exchanges instead of centralized points
Exploring Crypto with OpenWorld
Here at OpenWorld, our goal is to simplify crypto investing for everyone through passive yield portfolios. OpenWorld is currently under development and will soon be available via invite only.
Start earning passive income in crypto with #OpenWorld. OpenWorld allows you to easily diversify your portfolio across the crypto world.
Coming soon on ow.finance