How to buy Bitcoin & How to buy Ethereum & How to buy altcoins / How to pretty much everything around getting involved with cryptocurrencies FAQ
How to buy Bitcoin?
Open an account on an Exchange of your choice and buy some. Yes, fortunately it has become that easy. Simply visit Binance.com, Coinbase.com or any other of the main players of Bitcoin trading exchanges and open an account. The crypto trading platform of your choice should be compliant with your countries legal framework. However, we take this as a given at this point so just open an account on a cryptocurrency exchange and purchase Bitcoin or other cryptocurrencies with credit card or e. g. by exchanging (swapping) other cryptocurrencies to Bitcoin.
How to buy Ethereum?
The procedere is very similar to the one for Bitcoin. Open an account and buy ETH or open a wallet and buy some to directly store the ETH coins there.
How to buy Cardano? / How to buy Ripple? / How to buy altcoins like CHAINLINK? / How to buy a cryptocurrency? How the heck can I get some?
All those questions regarding a randomly chosen altcoin (every coin that is not Bitcoin) could be answered again starting with opening an account on a crypto currency exchange or a wallet. As soon as you have an account, trade the coins around as you wish, or send them to your wallet and swap them on an other exchange. Since some coins are listed on just a few exchanges, it´s sometimes necessary to switch from one Crypto Currency Exchange to an other.
Buy Bitcoin and other cryptos with credit card?
Many centralized exchanges allow to buy Bitcoin with a credit card, but you can also buy Bitcoin on an ATM with your credit card at hand. Unfortunately the distribution of Crypto ATMS isn´t that widely spread, proven by the fact that most of them are located somewhere in the USA.
What is a cryptocurrency exchange / Bitcoin exchange?
Also dubbed a digital currency exchange, it´s a place where you can buy and sell crypto currencies like Bitcoin or Ethereum for fiat money. Those coin trading platforms usually have a sophistiocated matching algorthm and ahuge list of cryptocurrencies to exchange.
Decentralized Cryptp Exchanges vs. Centralized Crypto Exchanges vs peer to peer trading
Centralized Exchanges are by far in the majority. All big exchanges nowadays are centralized, even if some pretend to be otherwise. They are fast and reliable and controlled but also hold their users funds, the coins, which could be in danger in case of a hack of the exchange.
Decentralized Exchanges (shortened DEX) have the advantage of lesser regulations, easier transfers and most importanlty don´t store their users funds (tradable coins) on their platform. The disadvantage is the lower volume and lower execution speed.
Peer to peer trading is the exchange of Bitcoins or altcoins from one wallet to the other, without any intermediary. The coin exchange happens right between two parties but that has the disadvantage of being legally not controlled and in case of even one character in the adress wrongly written in the funds lost forever.
What is a Bitcoin wallet / Cryptocurrency wallet?
When you get some bills from your countries fiat money, where do you put it? Right, in your wallet and naturally for receiving Bitcoin you need a cryptocurrency wallet. Think of it as a software version of the wallet you keep in your pockets that can talk with your coin account using the private and public key, providing the services of sending and receiving digital currencies of all kind.
Some providers of cryptocurrency wallets are:
- Coinbase wallet
- Metamask (Double Edge recommendation)
- Portis
- Squarelink
- ZenGo
Ledger Nano or Trezor Wallet which are both Hardware (physical) wallets. It´s easy to connect via USB and keeps your coins seperated from the network.
Here a list of 20+ crypto currency wallets from Ubuntupit: https://www.ubuntupit.com/best-cryptocurrency-wallets/
What are crypto currency pairs?
The best way to explain them is to show some examples, so here are some popular crypto currency pairs:
- Ethereum – Bitcoin: also written as eth btc – btc to eth – btceth – btc eth – ethbtc or eth in btc
- Litecoin – Bitcoin – also litecoin btc – ltcbtc – ltc btc
- Bitcoin – USD stable coins – e.g. btc tusd – gusd coin – Btc Pax
- ETH – LINK -Ethereum – Link – Link is Chainlink a highly appreciated protocol that makes it possible to trasnfer real life data to the blockchain
- XRP EOS – Ripple vs. Eos – two contenders for place 3-5
- ETH – BAND – Ethereum to Band protocol (a DeFi protocol)
- BTC – BSV – Bitcoin to Bitcoin SV
- Btc – BCH – Bitcoin to Bitcoin Cash
controlled but also hold their users funds, the coins, which could be in danger in case of a hack of the exchange.
Decentralized Exchanges (shortened DEX) have the advantage of lesser regulations, easier transfers and most importanlty don´t store their users funds (tradable coins) on their platform. The disadvantage is the lower volume and lower execution speed.
Peer to peer trading is the exchange of Bitcoins or altcoins from one wallet to the other, without any intermediary. The coin exchange happens right between two parties but that has the disadvantage of being legally not controlled and in case of even one character in the adress wrongly written in the funds lost forever.
What is a Bitcoin wallet / Cryptocurrency wallet?
When you get some bills from your countries fiat money, where do you put it? Right, in your wallet and naturally for receiving Bitcoin you need a cryptocurrency wallet. Think of it as a software version of the wallet you keep in your pockets that can talk with your coin account using the private and public key, provind the services of sending and receiving digital currencies of all kind.
Some providers of cryptocurrency wallets are:
Coinbase wallet
Metamask (Double Edge recommendation)
Portis
Squarelink
ZenGo
Ledger Nano or Trezor Wallet which are both Hardware (physical) wallets. It´s easy to connect via USB and keeps your coins seperated from the network.
Here a list of 20+ crypto currency wallets from Ubuntupit – https://www.ubuntupit.com/best-cryptocurrency-wallets/
What are crypto currency pairs
The best way to explain them is to show some examples, so here are some popular crypto currency pairs:
Ethereum – Bitcoin: also written as eth btc – btc to eth – btceth – btc eth – ethbtc or eth in btc
Litecoin – Bitcoin – also litecoin btc – ltcbtc – ltc btc
Bitcoin – USD stable coins – e.g. btc tusd – gusd coin – Btc Pax
ETH – LINK -Ethereum – Link – Link is Chainlink a highly appreciated protocol that makes it possible to trasnfer real life data to the blockchain
XRP EOS – Ripple vs. Eos – two contenders for place 3-5
ETH – BAND – Ethereum to Band protocol (a DeFi protocol)
BTC – BSV – Bitcoin to Bitcoin SV
Btc – BCH – Bitcoin to Bitcoin Cash
And why is crypto currency pairs comparing important?
The idea is to see the change not only in USD value but to see the correlation between the coins. In the past Bitcoin was highly correlating with almost all altcoins, but that changed dramatically in the past 2 years. Certainly a stable coin, one that is pegged to a fiat currency, won´t move as Bitcoin but also some altcoins with unique use cases seperated themselves from the market leader. The reason to observe this correlation is to easily observe price fluctuations and their effects on other coins.
Is altcoin mining profitable & what is the best crypto currency for mining?
Mining is the process of validating a transaction in blockchain that works with the Proof of Work consensus. In the early days of Bitcoin it was possible to mine new coins with a Laptop, today you need special equipment and a low energy price to be profitable.
Cryptomining is the process in which transactions are verified and added to the blockchain digital ledger. It´s also known as cryptocoin mining, altcoin mining and/or Bitcoin mining.
If you want to participate, you need to have a dedicated machine with a specialized graphical processing unit (GPU) chip or an application-specific integrated circuit (ASIC). Those could be really expensive, hence why many miners nowadays are connect in mining pools, channeling their calculation powers. The best way to find out if a certain altcoin is worth mining is to visit https://www.cryptocompare.com/mining/calculator/ and calculate your cosst to reward balance.
The whole process is intense in time and effort and consumes a lot of energy. This is one of many reasons why many altcoin projects switched to the Proof of Stake consensus. That brings us to…..
What is staking?
Staking is the process of validating a transaction in blockchain that works with the Proof of Stake consensus. Think of the stake as something of a deposit. Coins got frozen by validators so the underlying blockchain protocol can select them to create a block. The more coins a validator holds, the higher the chances he got chosen to validate and eventually create a new block. If he does that, he gets rewarded, e.g. with a certain percentage of the validated amount.
Staking Pools recetently gained popularity because they provide the opportunity to receive Staking rewards even with a very small investment. The staking pool gathers many investors to as bundle and act like a single validator to the network, sharing the rewards with the community.
Example: The new Ethereum 2.0 system asks for locking up 32 ETH coins to be able to act as a validator. That´s about 10K USD for a single investor. With a pool you could get in with less than one ETH coin.
How to swap coins?
The main difference of trading coins on a cryptocurrency exchange and to swap coins is the lack of an intermediary in the latter. On a coin trading platform you have to register yourself, walk through their due dilligence procedere and follow the AML and KYC rules and identifying yourself. To swap coins can be done without that, like right here on Double Edge! You just connect your wallet, like e.g. Metamask, to the swap engine and you are good to go. Double Edges backend will search for the best ratio and provide you with a fast an easy to handle coin swapping process. And after you swapped your coins, you disconnect and you are good to go, now having the newly swapped coins in your wallet. Here more details to coin swapping
Here a “How to swap coins” on the Double Edge website PDF to explain the process.
What is Yield Farming?
The last hype of 2020, Yield farming, has become popular within the DeFi (Decentralized Finance) space and provides users with the opportunity to lend and borrow crypto currencies to other users, receiving interests in the process.
Example: If you buy a few Ethereum coins and keep them on your wallet, it´s not yield farming. If you use those Ethereum coins to lend it to a protocol like Compound or Aave to receive profits outside of the Ethereum framework , it is.
Think of it as automated loans with the goal to receive the most profitable returns by letting a crypto protocol do the work for you.
As with above mentioned Ethereum coin staking pool, pools for Yield farming exist as well. The setup is pretty much the same since the pool again collects coins from many users to apply them to the farming process.
Click here for an analyses about one of the most traded tokens CHAINLINK $LINK here and a promising newcomer POLKADOT $DOT here