Connect with us

Cryptocurrency

What you need to know to start investing in cryptocurrency right now

Published

on

MarketWatch highlighted these products and services because we believe readers will find them useful. We may earn a commission if you buy products through our links, but our referrals are independent of any compensation we receive.

It’s been a hot year for cryptocurrencies, and 2021 is not even half over. The total value of cryptocurrencies briefly topped $ 2.5 trillion in May when a host of new investors stepped in, and now about 14% of American adults own cryptocurrencies.

Cryptocurrencies are digital assets that are exchanged online on exchanges such as Coinbase (the largest US crypto exchange) and Gemini or through online brokers such as Robinhood and SoFi Invest. Cryptocurrencies are hardly new. Bitcoin, the first and largest cryptocurrency by market capitalization, was created in 2009 and has been followed by more than 7,700 others. You may also have heard of Ethereum, Tether or even Dogecoin, which started as a joke and is now one of the 10 largest cryptocurrencies.

While some people are purely speculating, others see cryptos as a way to store value or hedge against inflation. Here’s how to invest in crypto now, whether you should get into it, and what you should know beforehand.

How to invest in cryptocurrencies

While investing in cryptocurrencies has become mainstream, it is not yet an option with many traditional online brokers. Here are some brokers that you can use to hold cryptocurrencies right next to other assets like stocks and bonds, but fees vary and it’s important to do your homework:

  • Robin Hood: Robinhood is 100% commission-free and landed on Bankrate’s list of Best Brokers for Cryptocurrency Trading, with the website noting that the easy-to-use app is a huge plus. Note that the company got in hot water with some of its customers this year when it ceased trading during the GameStop trading frenzy. Check out Robinhood here.

  • SoFi Invest: SoFi landed on Nerdwallet’s list of the best crypto exchanges and platforms. It’s not commission-free – it charges up to a 1.25% markup on crypto transactions – but a promotion is currently underway where the company will give you $ 10 in Bitcoin if you trade $ 10 or more in crypto. Check out SoFi Invest here.

  • Trading post: Like Robinhood, TradeStation is a Bankrate pick for crypto trading, and the site finds it to be best for “active or advanced traders”. However, it is not commission-free and charges 0.3% per trade for accounts less than $ 100,000, with the fee decreasing as your account balance increases.

TD Ameritrade, Interactive Brokers and Charles Schwab offer trading in Bitcoin futures.

If your broker doesn’t offer cryptocurrencies, you might consider signing up for an account with a crypto exchange, such as one of the following:

  • Coin base. This is the largest US crypto-only exchange and offers trading for over 60 different cryptocurrencies. Crypto transactions have a spread of around 0.5%, on top of a minimum fee of $ 0.99 and fees for digital token transactions. Go to Coinbase here.

  • Twins. This exchange offers over 40 digital tokens for trading and charges fees of up to 1.49% depending on the trading platform used. Check out twins here.

  • eToro. This social trading platform supports 20+ cryptocurrencies as well as other assets for non-US customers. The spread varies depending on the cryptocurrency, but starts at 0.75% for Bitcoin. Check out eToro here.

Prepare for risk and volatility

Not all cryptocurrencies are created equal, and each token has unique properties that help determine its price fluctuations. Because of this, it is important to learn as much as possible about a particular token, including why it was created (what problem it is trying to solve) and by whom (the governance structure) before investing, recommends Chris Kupier, vice president of Equity Research at CFRA Research.

“The better you understand, the more you will invest in the ‘right’ way,” says Kupier. For example, he compares Bitcoin to “Gold 2.0” because the digital coin has a limited supply and is seen by some as a way to store value and hedge against inflation – properties that do not apply to Ethereum, for example. (Note that this Bitcoin-is-the-new-gold version is certainly not shared by everyone, as this MarketWatch column shows).

Cryptocurrencies fall under the concept of alternative assets (like commodities or real estate) because they provide a way to diversify your portfolio and have low correlation to other assets like stocks and bonds, notes Kupier. However, cryptocurrencies are volatile, and with trading happening around the clock, 365 days a year, traders can respond instantly to messages – or even tweets. In fact, this year tweets from Elon Musk, CEO of Tesla, caused crypto prices to skyrocket and drop.

“Look, this is the Wild West, so you have to be prepared for it,” says Kupier. While Bitcoin has seen average annualized returns of over 200%, it has come with huge price drops, he adds. “You have to accept the volatility if you are to make those gains.”

When you’re ready to invest in crypto, here are some of your options: Coin base, Twins, eToro, Robin Hood and SoFi Invest.

Take into account the risk-reward dynamics

Investing in crypto is not for everyone. For those of you diving in, remember: Given the extreme volatility, moderation is key, notes Matt Schwartz, senior advisor and certified financial planner at Great Waters Financial. Just as you shouldn’t invest all of your money in a single asset – like a stock or a bond – cryptocurrencies should have a limited impact on the risk-return dynamics of your overall portfolio, he adds.

“If you assign 2 to 5% of your portfolio to an asset class, it won’t move the needle of your overall portfolio that much,” says Schwartz, adding that the exact assignment is unique for each investor. “It is important to think about your own situation and how it can help you achieve your goals.”

Some investment professionals say that if you want to dive into crypto, a smarter way to do it can be to averaging the dollar cost, which simply means investing a fixed amount on a regular basis. And be sure to consult an accountant about the tax implications of trading (it can get expensive).

Finally, think about how investment decisions affect you. “Don’t take so much risk that you can’t sleep at night,” says Kupier. “But the opposite is the case: if you’re watching Bitcoin all the time because you’ve invested 0% and watching it go up, you will likely have to buy a little to keep your peace of mind.”

When you’re ready to invest in crypto, here are some of your options: Coin base, Twins, eToro, Robin Hood and SoFi Invest.

About the author: Anna-Louise Jackson is a financial journalist with more than a decade of experience as a writer and editor. She was a reporter for Bloomberg News covering the US economy, US stock market and corporate finance. Her work has also appeared on NerdWallet, CNBC, The Associated Press, USA Today, Forbes, Fortune and Money.

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Cryptocurrency

Neobank launches real-time cryptocurrency conversion

Published

on

California-based MovoCash, a neo bank that Launched in 2017, released a new cryptocurrency service for its users last week. The technology called MOVO Chain acts as a curfew on cryptocurrency investments and enables customers to quickly convert 10 different cryptocurrencies into fiat currencies that are stored on a debit card.

The fintech works with the Coastal Community Bank and offers its customers five core services: MOVO Cash, MOVO CASH Cards, MOVO Pay, MOVO Digital Banking and MOVO Chain. MovoCash CEO Eric Solis said the company had registered more than 1.2 million accounts and issued half a million cards.

The company said “United States-based cryptocurrency users can convert and send / spend funds by debit card to anyone with an email address or cell phone number.

The new service can make crypto more important as a medium of exchange. Solis’ vision for the service is for customers to “use Bitcoin and other major cryptocurrencies as long-term savings and fiat for their daily payments.”

In order to process the conversion of cryptocurrency into cash, neobank has teamed up with the payment service provider BitPay.

According to Solis, Bitpay acts as a firewall “between the bank and the crypto” so that “over time [the payment] If you get anywhere near the bank, it’s back in fiat currency. “More specifically, the payment is stored in the form of tokens on an electronic debit card that can be sent to another electronic device.

Partnership with bank

Eric Sprink, President and CEO of Coastal Community Bank, said he was proud to work with neobank.

“MOVO Chain is providing MOVO customers with a unique solution that enables them to seamlessly convert and send cash values ​​from their Bitcoin or other cryptocurrency holdings,” he said in a statement.

MovoCash caters to a wide audience with its mobile banking services, from celebrities to those who make a living from paycheck to paycheck. Solis does not expect MOVO Chain to be used by all or even most of Neobank’s customers.

“I think the percentage of our users using Bitcoin is probably the same as what you would find in a general sample of society,” he said. The service fills a niche for selected customers who want to use cryptocurrencies like Bitcoin and Ethereum as an asset class, but want to access these funds for payments at any time.

The company recently signed up to Equity crowdfunding on StartEngine. To date, MovoCash has raised $ 219,204 from 106 investors on the crowdfunding site. In total, the fintech has raised around $ 1.5 million for a convertible bond. MovoCash has more than 420.8 million US dollars in user deposits and cites a growth rate of 242% in 2019 and 2020. neobank cites its security and the contactless end-to-end payment experience as reasons for its success.

Solis said he anticipates user accounts growth will grow organically as customers send payments and suggest the app to friends and family.

Movo has competition

MovoCash is hardly the first Neobank to offer its customers services related to cryptocurrencies. Update recently released a Bitcoin Rewards credit card that offers customers 1.5% bitcoin refunds when they use the card. Fintech Paybby plans share a cryptocurrency platform this summer as the company seeks to increase the popularity of crypto with minority investors. The Neobank electricity plans to launch crypto products in the future.

Continue Reading

Cryptocurrency

Why Ethereum Could Surpass Bitcoin In The Near Future – Crunchbase News

Published

on

By Ahmed Shabana

Even after major cryptocurrencies experienced a threatening collapse from their all-time highs in April, most have soared 200 percent to 300 percent or more from that point in the past year. Bitcoin is making all the headlines, and there are legitimate concerns about its roller coaster nature.

Subscribe to the Crunchbase daily

But what about Ethereum? Ethereum was conceived in 2013 and is an open source platform that helps develop and implement new decentralized applications with the same core concepts as blockchain.

The difference between Ethereum and Bitcoin has caught the attention of large market players like Goldman Sachs, who recently advised investors that Ethereum has a good chance of surpassing Bitcoin’s market cap of $ 660 billion.

The Ethereum network holds more promise because of its real world applications and its ability to store value. Ethereum represents the future of programmable money and smart contracts in ways that older cryptocurrencies like Bitcoin cannot.

Ethereum simplifies worldwide payments

Since the Ethereum network supports the development of new applications in its infrastructure and enables their creation, it is potentially a more valuable resource in the long run. Ether (ETH) will be used to pay for these transactions, as last seen with the booming popularity of NFTs this spring. The result is a much higher usage rate for Ether with far more transactions than Bitcoin in the last 12 months.

Ahmed Shabana from Parkpine Capital

Despite the recent decline in cryptocurrencies, ether rose nearly 1,000 percent in the past 12 months, compared to the 300 percent increase in Bitcoin. Where a Bitcoin is a pure token of value – a currency that is backed by the perceived value of those who own it – Ethereum and the ETH blockchain fuel each other. The recent upgrades to the Ethereum network are helping it to scale much faster and lower transaction costs on the network, which further drives the price of the tokens up.

Instead of having a central instance that monitors how the applications run on the Ethereum network and which transactions are processed, Ethereum-based apps are booming. The most common types of these apps are DeFi. These apps saw 2,000 percent growth in 2020, with more than $ 16 billion in crypto assets stored in their logs by the end of the year.

The future of ETH

Ether started 2020 at $ 125.63 and grew nearly 500 percent to $ 729.65 by the end of the year. It hit $ 4,380 briefly in 2021, but has since hovered between $ 1,700 and $ 2,500, sometimes rising or falling as much as $ 1,000 in a single week.

The big question is where will ETH end in 2021. Many projections are relatively optimistic, with an average price target of between $ 3,500 and $ 4,500 by the end of the year and average long-term projections of $ 11,170 by 2025. However, there are some who see it even faster and more substantial during this time grows.

In a recent Forbes article, a panel of crypto experts including Sagi Bakshi and Lex Sokolin predict that ETH could climb as high as $ 19,842 by 2025 and that by the end of 2022, due to its growing utility in the world, it could increase the The most common cryptocurrency could be the marketplace.

These experts name a number of upgrades that will be made to the network in 2021 that will lower the currently high transaction costs and dramatically increase the benefits. An expert on the panel, Sarah Bergstrand, estimates that ETH could reach US $ 100,000 by 2025.

The biggest upgrade contemplated by investors is EIP-1559, which will overhaul the transaction fee system used by Ethereum. Instead of sending charges to miners who perform tasks on the network, users send the charge to the network itself, which wipes out the charge, reduces the overall supply, and then increases the value of the currency.

The future of cryptocurrency regulation

Ethereum represents a sustainable, function-oriented approach to cryptocurrencies that will support the future of DeFi. But many people stay on the sidelines waiting for government regulations to be implemented.

While longtime cryptocurrency investors lament the idea that regulations limit the freedoms currently available in the market, large investors and corporations see the inevitable implementation of such regulations as a source of stability that could lead to mass adoption.

After several months of chaos, the Biden government is examining how to tackle the markets. A congressional committee has been set up to review digital currencies, the FDIC has asked banks to provide documentation on how they use digital assets, and auditor Michael Hsu is reviewing all current and past guidelines on cryptocurrencies. The chairman of the US Securities and Exchange Commission warns bad actors of impending enforcement and regulation.

Overall, many view these changes as good. When markets are regulated, they become safer for everyday users, and Ethereum can go “normal” with the range of decentralized apps that support and enable it.

Ahmed Shabana is a venture capitalist, startup advisor, investor and entrepreneur. He is Managing Partner of Parkpine Capital, Founder of the Global Ventures Summit, and Creator of The Hungry Company.

Illustration: Li-Anne Dias

Stay up to date with the latest financing rounds, acquisitions and more with the Crunchbase Daily.

Continue Reading

Cryptocurrency

Google’s New Cryptocurrency Ad Policy Goes Into Effect – Featured Bitcoin News

Published

on

Internet giant Google’s new advertising policy has come into effect. The company now allows certain cryptocurrency displays, such as: B. those that advertise the exchange of cryptocurrencies and wallets. Advertisers must meet certain requirements and be certified by Google.

Google now allows some crypto ads

Google’s new advertising policy for financial products and services, announced in June, has come into effect. A note on the internet giant’s website:

Starting August 3, advertisers offering US-targeted cryptocurrency exchanges and wallets will be able to advertise these products and services if they meet the following requirements and are certified by Google.

To be certified by Google, advertisers must either be registered with the Financial Crimes Enforcement Network (FinCEN) as a money services company or be a federally or state-recognized bank. They must also meet the relevant legal requirements and their ads and landing pages must comply with Google’s advertising guidelines.

In 2018, Google banned ads related to “cryptocurrencies and related content (including, but not limited to, Initial Coin Offerings)”. [ICOs], Cryptocurrency exchanges, cryptocurrency wallets and cryptocurrency trading advice) ”as well as advertisements for crypto-related“ aggregators and affiliates ”. Google then allowed selected crypto ads in the US and Japan.

Last June, Sydney-based law firm JPB Liberty filed a class action lawsuit against Google, Facebook and Twitter for banning cryptocurrency ads.

While the new policy allows certain crypto ads, Google still doesn’t allow ads for ICOs, defi-trade protocols, and those that “promote the buying, selling, or trading of cryptocurrencies or related products.” In addition, “ad targets that aggregate or compare issuers of cryptocurrencies or related products” are prohibited.

One of the prohibited ad categories is “Celebrity Cryptocurrency Recommendations”. Many scammers have taken advantage of Google and Youtube to promote fraudulent Bitcoin giveaways. Apple co-founder Steve Wozniak sued Google and Youtube last July for promoting Bitcoin advertising fraud using his name and likeness. However, the court ruled in Google’s favor.

What do you think of Google changing its policy to allow ads in cryptocurrency? Let us know in the comment section below.

Photo credit: Shutterstock, Pixabay, Wiki Commons

Disclaimer of liability: This article is for informational purposes only. It is not a direct offer or solicitation to make an offer to buy or sell, or a recommendation or endorsement of any product, service, or company. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author are directly or indirectly responsible for any damage or loss caused or allegedly caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

Continue Reading
Advertisement

Trending