In recent years, many people have have heard about overnight millionaires making fortunes using cryptocurrencies. In this article, I will give a brief overview to teach you how to make money using crypto. Then, one day perhaps you can become a millionaire through the vast opportunities in the crypto market.
What Is Crypto?
Crypto is another financial market but with limitless opportunities everywhere. Think of your traditional markets such as the New York Stock Exchange or London Stock Exchange. Crypto is similar to these, however it is decentralized and runs 24/7.
Now, many have heard the term “decentralized” get thrown around, but what exactly does it mean? Decentralization means that no single entity can have majority control over an agreed upon protocol. Rather, the protocol is managed collectively by its stakeholders.
In a traditional company, it is likely that upper management makes decisions without the employees or clients having a vote in what happens. With decentralization, each stakeholder has a say in what they believe the right decision would be.
How Does Crypto Work?
Cryptocurrencies function through cutting-edge technology powered by code and a distributed public ledger. The name blockchain technology is easy to comprehend through the following mental model:
- Think of the traditional transparent block-shaped empty tupperware used to pack your food for lunch. Once you pack your food to its max capacity, you close it and begin using other empty containers to finish packing.
This sums up how the blockchain works. The blocks are filled with successfully processed transactions until they reach their max capacity. Once this occurs, then a new block is formed and begins storing the next wave of transactions. After each block, a cryptographic chain connects the two together to form what is known as “the blockchain.”
Decentralizion makes the blockchain immutable, meaning the transactions cannot be tampered with. Anyone can visit websites such as Etherscan to see past transactions that have occurred on Ethereum’s distributed public blockchain.
How To Invest In Cryptocurrencies Safely
There are many approaches to take when figuring out which is the safest way to invest in cryptocurrencies. I will go through three different ways and let you decide what is most comfortable for you. I would highly recommend going through these options thoroughly as this is just a brief overview of these methods. Before we dive in I would like you to keep in mind to never share your private keys with anyone. This is your 12-15 seed phrase that is assigned to your wallet once you create one. If you plan on receiving or sending out crypto your public address is the one to share as it was designed to do so.
Go through a centralized exchange such as Coinbase, Binance, or FTX.
This route will provide you with the simplest and quickest way to get your foot in the door. Crypto exchanges offer a variety of cryptocurrencies and allow you to buy fractional tokens. They are the ideal place to begin making money using cryptocurrencies before getting into other categories of crypto such as DeFi or NFT’s. The con about this option is that a third party has a say in what you can and cannot do with your funds.
Open a Metamask wallet on your web browser.
This method will allow you to own a non-custodial wallet, meaning there are no third parties between you and your crypto wallet. This allows you to freely make transactions without any company restricting you as long as you have the necessary funds. However, on the downside, this wallet is considered a ‘hot wallet’ meaning it is online where possible attacks could take place.
Purchase a hardware wallet (Ex. Ledger, Trezor, etc.)
This provides you with the safest method of protecting your crypto. Hardware wallets are considered ‘offline’ meaning they are less vulnerable to online attacks. Your investments will always be safe and protected as long as your private key is known. However, this method all comes down to you being aware of where you store your hardware wallet.
Ready To Make Money In Crypto Now?
If so, I would like to wish you all the best in your crypto journey. It could potentially be a life-changing experience you will never forget. I would like to reiterate that you should never share your private keys with anyone. This is the 12 to 15-word phrase given to you when you open your own non-custodial wallets such as MetaMask or Ledger. If you want to send or receive crypto share your public address as this is completely safe.
To learn more about everything crypto, see our Learn section.