Cryptocurrency is increasingly becoming a part of modern businesses. It is easy to feel lost in the conversation. Like other things that have to do with money, it is important to have some foundational knowledge. This article is aimed at helping you get started. It will highlight 5 things you must know to make your journey much faster. It will highlight things you will probably be using every day if you intend to understand the industry. so let’s begin
Things You Must Know When You Are New To Crypto
1. The Market
You need a place to get the crypto market data such as a list of all the crypto in the market, and their prices, historic prices, little snippets on the different coins/tokens, where to buy them, who the project teams are, the community behind each crypto project, general information about the crypto market, etc.
It helps to have all this in one place. The two biggest platforms for these are https://coinmarketcap.com/ and https://www.coingecko.com/. When someone says they want to check the market, they are probably referring to either of these two sites. They provide bulk statistics for the entire market as well as useful information on individual coins, exchanges, crypto types, communities, etc.
Before you buy any coin, it is helpful to check details about the coin on these platforms. They are both valuable research tools. Any coin not listed on either of these platforms is likely to be worthless because it invariably means it is not listed on any exchange (where you sell your crypto assets).
2. The Exchange
A crypto exchange is where you buy or sell your crypto assets. There are a variety of exchanges where you can trade your assets. There are basically two types of crypto exchanges- Centralized and Decentralized exchanges. Centralized exchanges are more like “brokers for cryptocurrencies”, They are controlled by a central body and ideally short be your choice if you are a beginner.
Decentralized exchange is not controlled by a central body, it works on smart contracts and typically will not need any form of registration to use them (e.g UniSwap , Pancakeswap , QuickSwap, etc.).Unlike Centralized exchanges, Decentralized exchanges can help you stay anonymous (since no signup is required). they do tend to have higher trading fees and you will need to know a few things to be able to use them.
Centralized exchanges are much more flexible to use, cheaper, and typically will have more coins/tokens listed. You will find a list of some of the top centralized exchanges at BEST CRYPTO EXCHANGES AND TRADING FEES. Be aware that there may be restrictions on the exchange you can use depending on your country of residence. For example, only a few regulated exchanges are allowed to operate in the US. If you live in the US, your best option is probably coin base (You can check coin base review LATEST COINBASE REVIEW)
As a beginner, you have the option of making your first purchase using your credit card, direct payment from your bank, or through a peer-to-peer method that is escrowed by an exchange. You will find a variety of options to choose from and it varies across the different crypto exchanges. Use the market tool above to research the best exchange that suits your specific needs. Some good recommendations for crypto exchange will include big names like Binance , Coinbase , KuCoin, etc.
3. “Storage” For Your Cryptocurrency
Cryptocurrencies are “stored” in Wallets. As with most valuables, you need a place to store them, same is true for cryptocurrency. A crypto wallet is your gateway to access your assets that are stored in the blockchain. From a more technical standpoint, a wallet is a keychain that holds your private keys. Your private keys are what you use to approve or sign transactions before your assets can be moved from one address on the blockchain to another.
There are two types you should be aware of as a beginner. A Non-custodian or Self-custody and a Custodian wallet. A Non-custody wallet is one where you have access to the Private keys of the Wallet. You are fully in control of the management of the wallet. They can be either web-client, desktop-based, hardware, paper-based, or installed on your mobile device, Common Non-Custodian wallets are Metamask.io wallet(web-based), Atomic Swap Wallet (Desktop), Trust Wallet (Mobile), Trezor (Hardware), etc.
A Custodian Wallet on the other hand is operated by a third party on your behalf. You do not have access to the private keys. It offers the advantage of simplicity. However, the risk is significantly higher as you do not have direct access to your funds at all times, they can there be frozen, the wallet provider might abscond with your funds, can be hacked, etc. All crypto exchanges offer this type of wallet to their client. Other examples in the Wallet Service by Coinbase. You can signup for a free $10 bonus for a Coinbase Wallet.
4. The Blockchain and Explorer
This can be a bit confusing to beginners. Blockchain is the underlying technology that powers cryptocurrency. There are several of them and sometimes you can switch a particular cryptocurrency from one blockchain to another using tools that are collectively known as bridges. It is common to simply refer to the different blockchains as “CHAINS”. Some examples of chains are the Bitcoin chain, Ethereum, Polygon, Binance Chain, Optimism, Arbitrum, etc. A complete list of the available chains and the technical setting for each can be found at Chainlist.org.
Every transaction is visible on the blockchain, and as a beginner, you should be able to see the state of your transaction, every detail can be seen using tools that are called explorers. There is a different explorer for every chain. Some common explorers are as follows
https://etherscan.io/ for Ethereum
https://bscscan.com/ for Binance Smart Chain
https://polygonscan.com/ for Polygon
https://arbiscan.io/ for Arbitrum
5. Join The Crypto Community To Learn and Get Information
Join Bitcointalk.org or similar sites to learn more about crypto.
Conclusion
As a beginner, you must be familiar with these five things
- The market
- Exchanges
- Wallets
- Blockchains
- Community
you will know about the crypto market in general and for specific coins (coinmarketcap.com and coingecko.com), you will need a place to buy or sell your crypto, that’s what crypto exchanges are for. There are many to choose from, Then you need to move your crypto to somewhere safe, so you will need a personal wallet to help you “store” or keep your crypto, You will also need to know a bit about the different blockchains or simply “chains” and how you can track your transactions on these chains. That is where you use explorers. And finally, you will need to be a part of a general crypto community to help you learn about the latest development or major events.
