Getting to know and buying in on the cryptocurrencies are a little bit mysterious for a lot of people and this often also makes it quite interesting. There is a lot of information about it, but somehow you still do not know that much about this mysterious way of paying.
There are a lot of different articles that you can read online about all aspects of cryptocurrencies and for examples in this one in Swedish (so use Google Translate if you don't know Swedish), he compares 11 different cryptocurrencies in this article.
We have compiled a list of the most obvious things to know if you want to increase your knowledge about the matter and maybe even invest.
Getting familiar with the terms
When reading up on a subject this complicated it can be a good idea to familiarize yourself with the most important terms so you can understand the texts you are reading. One term that is essential to know about is DeFi. DeFi stands for decentralized finance and it is a blockchain-based form of finance that does not rely on central financial intermediaries such as brokerages, exchanges, or banks to offer traditional financial instruments, and instead utilizes smart contracts on blockchains, the most common being Ethereum.
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Storing your cryptocurrency in three different wallets
A cryptocurrency wallet is like a regular wallet where you store your cryptocurrency after you have bought it. It is like your bank account for your regular money. There are a number of different options to choose from when it comes to finding the best wallet for you. There is a risk factor that you need to be aware about, and it is important to make sure that your wallet is safe, so it will not be stolen. If that happens, it is not possible to get it back.
There are three different types of wallets:
- Online wallets. This is an easy and fast solution that is really quick to set up. However, this is also the least safe option.
- Software wallets. This is an app that you download onto your phone, so this is also quite easy and quick. This option is more safe than the online wallet.
- Hardware wallets. This is definitely the safest option, however, also a bit more complicated. This is a portable device that you have to keep with you and plug into your computer via USB when you want to access.
The wallet you need will depend on which cryptocurrency you want to buy. If you buy Bitcoin, for example, you'll need a wallet that can store Bitcoin. If you buy Litecoin, you'll need a wallet that can store Litecoin.
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