What is crypto investment? A-Z guide for newbies + best ways

According to the Singapore FinTech Union, more than 300 million people have entered the cryptocurrency market since 2021 and have experienced the purchase of digital currency.

300 million people comprise less than 4% of the world’s population, but there is fierce competition in investing and earning more profit among these people. On the other hand, pewresearch.org has published statistics that 86% of Americans do not know much about investing in digital currency and the crypto market, and only 16% of Americans have used
digital currencies so far.

The mentioned statistics indicate the importance of learning the fundamentals of cryptocurrency as quickly as possible so that you can compete in this field with full knowledge. This article explains everything you need to know about investing in digital currency. Stay with us, and you’ll get educated about the most common and profitable ways to invest in cryptocurrency.

What is cryptocurrency and why
does it matter?

Cryptocurrency is a special type of digital money that is generated electronically. Digital currency is a digital asset that may increase or lose its value, like stocks and bonds. Similarly, cryptocurrency is a digital asset that uses blockchain technology to assign ownership to each unit. The important point is that there is no need for banks or centralized centers to generate digital currency and send and receive it. Cryptocurrency uses cryptographic systems during transactions, and that’s why it’s dubbed a decentralized property.

The interesting thing about digital currency is that the value of a cryptocurrency unit depends on whether people want to buy that digital currency. That is, if many people buy crypto, its value increases, and if people stop buying crypto, its value decreases. The relationship between trust and value is eternal.

Although most users view the crypto market as a short-term and high-yield investment, the various uses of digital currency are expanding. Some reputable and large businesses such as EtsyExpedia, and PayPal have enabled cryptocurrency payments for services. Even for exchanging goods or services, two people interested in paying with digital currency can exchange this way.

Why is crypto investment essential?

Investment should be defined as the allocation of your money to different assets, With the aim that the property value will increase in the future and your capital will increase. Investing in the cryptocurrency market has advantages that have attracted many people, Such as sanctions immunity, the benefit of a decentralized economy, providing security, and spending less time and money.

But the first question you should ask yourself is, why are you planning to invest in digital currencies? Different investment markets have different risk percentages; among them, cryptocurrency is considered a high-risk market. Therefore, you should enter the digital currency market by educating yourself about this market and accepting the existing risks.

How should you invest in crypto?

Digital currencies run on a distributed ledger called blockchain, which is a repository of all updated and maintained transactions of currency owners. Digital currency units are created through a process called mining, which involves using computer power to solve complex mathematical problems to generate coins.

Mining is not the only way to acquire digital currencies; users can buy the desired digital currency from exchanges and store it in their wallets. If you have a digital currency, you don’t have anything tangible! What you have is a key that allows you to transfer a record or unit to another person without the supervision of a trusted third party.

To invest in digital currency, you must first choose a reliable exchange. International reputable exchanges such as CoinbaseBinance, and Kraken are suitable options. After choosing the desired exchange, verify your identity using the identification documents at the exchange. Then proceed to invest in digital currency using the bank information you introduced when registering at the exchange.

Exchanges allow users to buy digital currency with their bank cards in cash. You can usually choose between digital currencies such as Bitcoin and Ethereum. One bitcoin is worth several thousand dollars, and may not be possible for new users to buy it. So you can buy a fraction of a coin. Exchanges charge a fee for every trade you make. Once you buy a digital currency unit, it will be added to your wallet.

The 2 Most common tools for crypto investment

To invest in digital currency, you need a variety of tools. For example, fundamental and technical analysis tools help users know when to enter the market and exit. In the following, we will examine some investment tools in digital currency so that you can move in this direction with full familiarity.

Fundamental Analysis

We mentioned that one of the most important investment tools is market analysis. In fundamental analysis, evaluation is done from top to bottom; That is, you try to calculate its value by analyzing the value of a digital currency and the economic and social factors affecting it. To use fundamental analysis, you need to gain complete knowledge of the factors affecting the prices of your desired digital currency in the long term to get a better perspective of the rise or fall of the value of your cryptocurrency.

Technical Analysis

Unlike fundamental analysis, which is based on news, the economy, and the state of society, there is another market analysis called technical analysis. Users try to make more profit by using technical analysis. The basis of technical analysis of prices is the previous trend of the market and the volume of transactions. In fact, in technical analysis, currency prices are determined by using mathematical indicators and interpreting charts.

Fundamental analysis is more suitable for examining a cryptocurrency’s long-term trend. In technical analysis, the short-term trend of the price of a currency is measured by analyzing charts. Therefore, both fundamental and technical analysis together can provide suitable conditions for investing in digital currency.  

List of the most profitable crypto investment methods

Various methods have been introduced to invest in digital currency. In this section, we mention additional investment methods in the digital currency market:

  • Buying and keeping digital currency (holding or hodling)
  • Arbitrage (price difference between exchanges)
  • Mining or extraction of digital currencies
  • Trading
  • Identification and participation in valid airdrops
  • Staking and digital currency deposit interest
  • Trading robots and the use of artificial intelligence
  • Participation in ICO, IEO, and IPOs (Learn everything about the difference between ICO/IEO/IPO in our blog post)
  • Play to earn games
  • Digital currency lending
  • Make, buy and sell NFTs

What is the best way to start crypto investment?

In the previous section, we mentioned conventional investing methods in digital currency. In the following, we intend to introduce the best investment methods in this market. 

Buying digital currency from the exchange and holding it is one of the best ways to invest in digital currency for traders.The investment risk in this sector is low, and the rate of return and the time required for return are high. Users need initial capital to hodl.

Mining is another good way to invest in cryptocurrency. However, keep in mind that the digital currency you are looking for must be able to be acquired through mining. In addition, mining has high profits in periods when the price of the digital currency in question is higher than the gas fee required for mining.

Trading can be considered a suitable method for traders. In trading, the amount of risk and return is high, and the return duration is low. You must have initial capital for trading.

 If you start investing in these methods, you’ll be among the many doing the same thing. But if you want to gain an advantage and beat the competition? Read on to discover how.

Play 2 earn, the latest and most entertaining way to invest in crypto

Play 2 earn games are a new genre in the gaming industry that combines blockchain and gaming. The increasing popularity of non-fungible tokens or NFTs in the gaming ecosystem has increased users’ interest in this field to the point where many are using games with digital currency rewards to earn free cryptocurrency.

In this type of game, users buy lands, objects, tokens, and items, and by acquiring some kind of digital currency in the game, they buy NFT tokens or transfer them directly to their wallets. As you probably know, the NFT industry has grown exponentially in recent months, to the point where some of these cryptocurrencies have been sold at multi-million dollar prices. For this reason, this event is also considered a way to earn money in blockchain games.

ZipClash, the first idle/clicker p2e game for beginner crypto investors

ZipClash is a p2e game that rewards players with in-game tokens for completing daily tasks, upgrading planets, and operating interplanetary restaurants.  In ZipClasah, players can build, upgrade and sell planets and boosters in the market as NFT (non-fungible tokens). You can download and install the game on your mobile through the ZipClash homepage.