As Bitcoin and the crypto ecosystem continue to reach all-time highs, investors are being awakened to the true value of crypto assets. As newcomers gain interest, the most frequently asked question has become: how can I buy Bitcoin? This article will provide a step-by-step manual on how to invest in cryptocurrencies and the various elements to consider before investing.
First, every investor should consider how they would like to invest: individually or with a digital asset manager. You should invest individually if you believe you have a firm grasp on the various tokens throughout the ecosystem and would like to diversify your holdings based on your own strategy and methodology. Investing individually would provide you the freedom to invest and own various tokens on your own, versus owning a portion of a larger-scale investment strategy. If you are new to the crypto space and are looking to join in on the fun without knowing much about individual coins, or would rather entrust professional portfolio managers to drive returns for you, then you should choose a digital asset manager and a specific strategy that fits your investing interests.
To invest individually, you must first choose how you’d like to invest. If you are simply looking to own Bitcoin, a very basic entry point would be to invest through a Bitcoin ATM, which are widely available in grocery and convenience stores across the United States. These ATMs allow you to buy Bitcoin with cash, debit and credit cards, and most allow the sale of Bitcoin in return for cash on your card. Purchasing and selling Bitcoin through an ATM will provide you with a paper wallet and a private key password to keep your Bitcoin safe. This paper wallet must be kept safe and secure, as loss of this wallet and the private key would mean a total loss of the assets stored on these until the address and private key are recovered. If you already have a Bitcoin wallet, you can scan the QR code of the wallet or provide its address to send the Bitcoin straight to your preexisting wallet.
If you’d like to actively trade Bitcoin and other crypto, as well as track their progress and keep up to date with the ecosystem daily, we recommend purchasing Bitcoin through a crypto exchange. First, you must decide what type of investor you are looking to be. If you are simply looking to trade and keep up with crypto whenever you can, we recommend setting up an account with Coinbase, Gemini or Kraken. If you are looking to be a more sophisticated investor, Binance US offers real time analysis and price trends, giving investors the ability to witness active and past trading candles as well as buys/sells coming through the platform. Access to these price trends and real time market activity provides investors insight into where Bitcoin’s price will move in the short term.
Once you have decided which exchange will give you the capabilities you need, it’s time to set up an account. Setting up an account on a crypto exchange requires investors’ information for proper KYC background checks. This will require a government issued ID, a bank account to source money flows, and an onboarding process for account verification. Once your account is set up, you are free to invest on the platform.
Purchasing Bitcoin and other crypto on crypto exchanges is an easy process. You simply look up the coin you would like to invest in, then select the dollar amount of the coin you would like to purchase (crypto assets can be bought in small parts, so you do not need to buy a whole coin) and confirm the purchase to finalize the transaction.
Once you own your coins, it is crucial to know how to protect them. Keeping your coins on exchanges is the simplest way to consolidate your assets in one place, but if you want true ownership of your tokens, you must own and control the private key to your wallet, which acts as a password to gain access to your coins. When your coins are located on exchanges, you do not truly own them because your private key passwords are stored on the exchange. When your private key is stored by a centralized platform, your coins may risk compromise if the platform is hacked. Thus, to ensure the true security of your tokens, we recommend taking your coins off of crypto exchanges and holding them on cold storage wallets like the Ledger Nano X.
At Sarson Funds, we aim to enable and empower our community to access the new age of financial freedom. To learn how to invest with a digital asset manager, stay tuned for our next segment of Crypto Basics. Until then, do what you came here to do and go buy some Bitcoin. Happy HODLing!
By Liam McDonald
Disclosures: Not investment advice. It should be assumed that Sarson Funds or its affiliated managers hold positions in all projects that are discussed. It is not possible to invest in any project directly through Sarson Funds, Inc. or its affiliated managers. Any investment product offered by managers affiliated with Sarson Funds should be assumed to be only available to Accredited Investors and subject to the individual terms and conditions of that offering including but not limited to those eligibility requirements associated with U.S. Securities Regulation D, section 506c. Talk with your financial advisor before making any investment decisions or have them contact Sarson Funds directly at info@sarsonfunds.com
