How to start and stop using crypto? Easy tutorial to let you leave or join the digital world safely

The world of cryptocurrencies is very enticing and now much more accessible and tinkerable for a user. However, like any other option involving financial considerations, this one has its own do’s and don’ts. We’re going to examine the basics that an end-user needs to become familiar with in order to get the most out of this market.

1. Market entry – step-by-step instructions

As a user, you can enter the market by signing up with any of the cryptocurrency platforms that allow Indian users to transact on their platforms. While registering with any platform is the easiest, it is important that you know more about the type of assets you will be dealing with. Unlike the other forms of securities and assets that you may be familiar with, trading cryptocurrencies would mean that you should have a basic understanding of the underlying blockchain technology, the country of origin, and the social and political implications that it will can lead to price fluctuations of the cryptocurrency. In the past, tweets from celebrities like Elon Musk have caused erratic fluctuations, and you need to be aware of all of this before either buying more or selling anything.

Most importantly, you cannot put all your eggs in one basket and buy many of the same coins for your portfolio. Try to diversify the nature of your investments.

1. What do you need?

You will need:

1. Identify a cryptocurrency broker or cryptocurrency exchange;
2. register with the identified broker/exchange to open an account;
3. meet KYC requirements, including providing your PAN details;
4. Deposit cash (fiat currency) – this is usually validated by the UTR number for your NEFT transfer on most platforms;
5. Place your cryptocurrency order;
6. Choose a storage method.

When you buy it on an exchange, it is usually stored in the wallet associated with the exchange. If you don’t want the exchange to store them and you want them moved to another, more secure location, you can choose between a hot and cold wallet. A hot wallet is a crypto wallet that is stored online and runs on internet-enabled/connected devices such as your computers or phones. These are convenient, but accessible via the Internet, and as such a degree of vulnerability remains.

In contrast, a cold wallet is a crypto wallet that is not connected to the internet and takes the form of an external device such as a hard drive or USB stick. Because it is stored offline, it is treated as one of the safest forms of storage; with an associated key code. As a cold crypto wallet user, you must ensure your device remains secure and you own the code or you may never be able to get your cryptocurrency back. This happened so be careful.

1. Step-by-step guide on what to do if you want to exit the crypto/bitcoin industry

Because the industry is volatile, there is no set or prescribed way to exit this industry.

1. One of the simplest solutions would be to set a price target and exit the market at that point. For example, if you bought a specific crypto asset for INR 2000, you can set your target sell price to INR 2500 and sell your crypto asset accordingly once it reaches that amount.
2. You can also opt for a return percentage; Accordingly, once this target is met, you can sell half of your investments and sell the next half at a similar target return price.
3. Some also prefer exit by portfolio. For example, if you have made an investment of INR 500,000/- and after a certain period of time feel the need for around INR 750,000/- when your crypto asset portfolio has reached that limit, you may prefer to sell your assets and to exit the market.
4. It is also possible for you to set a day, week or month to sell a percentage of your investments. Let’s say you want to sell 10% of your investments on a regular basis, by the end of 10 cycles you would have sold the entire investment.

These aren’t the ideal scenarios, but this is one of the many available for you to practice with.

1. What alternatives are there to joining?

Considering that not all would buy cryptocurrencies outright, you can always consider investing in cryptocurrency-related companies due to the volatility. This would be a convenient proposition for anyone intending to invest in companies with far greater regulatory oversight that you may continue to hold in the blockchain/cryptocurrency ecosystem.

As parting advice, as with any other form of investing, make sure your financial risk tolerance and investment goals are aligned with the expectations and possible outcomes of that particular company. It is a highly speculative investment and requires you to invest with great caution and careful consideration.

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