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Mihaill Kudryashev, a Front-end engineer at PLATINUM ENGINEERING, wrote this article while seeking to raise awareness about USDQ, a stablecoin his team is helping to develop. Among the biggest benefits, USDQ brings full decentralization and predictive capabilities. Soon there will be even more fully backed stable coins: JPYQ, KRWQ, SGDQ, HKDQ, CNYQ, RUBQ under Q DAO governance. Slowly learning more about blockchains, Mihail has been effective in transforming vague ideas into effective front-end solutions with strong UI/UX. Within his team, he’s helped many crypto startups to make their voice heard throughout the emerging global crypto community. In this article, Mihail looks into the key benefits that users win from using USDQ.
https://i.redd.it/9us7atz426f31.png
USDQ brings stability, with no need to engage legacy finance
How do USDQ and Q DAO coins work within the ecosystem?
USDQ is decentralized stablecoin, which uses algorithms to offer higher stability and reliability. It's backed by Bitcoin (another top 10 cryptocurrencies will be added in future). The elegant system places all transactions on the blockchain and empower users to execute cross-border and disintermediated transactions at any time and from any place. It's pegged to the value of USD, i.e. 1 USDQ always equals 1 USD. The ecosystem's design borrows heavily from fractional banking systems. In the nutshell, USDQ is a customer-facing stablecoin and Q DAO is an internal "operational" coin; together they help create a stabilized safe haven for anybody who's looking to hedge against rampant volatility of crypto markets.
Introduction to Q DAO and USDQ
There's a number of factors that prevent mass adoption of cryptocurrencies. The biggest factor among this is high volatility, seen in crypto. Bitcoin, the oldest and most popular coin, has been fluctuating with prices oscillating between 20,000 and 3,500 in just one year of 2018. No potential adopters, be it merchants or individuals, would be happy with suffering huge losses that such drastic changes can entail. And it's this high volatility that USDQ is set to address, bringing stability and convenience.
Tether (USDT) is probably the most well-known and widely used stablecoin. However, it has been embroiled in various controversies from the very start with no end to these in sight. Although the system is supposed to assure the 1-to-1 fiat reserves for all Tether units created, the website content has been recently changed to say that the issuer views not only cash in the bank, but also various loans to other companies, as the reserves. Both regulators and crypto enthusiasts have voiced concerns, which might bode ill for Tether in the months to come.
USDQ works differently. Here, the stablecoin is pegged to US Dollar and backed by Bitcoin (+top 10 other cryptocurrencies in future). It's similar to lending operations and fractional banking systems. Overcollateralization is used to mitigate potential unexpected changes in assets prices.
The USDQ ecosystem is highly transparent as all of the operations are recorded on the immutable Ethereum blockchain, open to review by anybody and at any time. The smart contracts bring automation to business processes and eliminate the need for middlemen to assure trust and prevent abuse.
In order to determine how viable USDQ will be in the future, we need to discuss the two tokens used within the ecosystem.
Review of Q DAO and USDQ
Q DAO is governance token, entitles holders to participate in voting for new decisions. Importantly, holders are interested seeing Q DAO's prices growing and thus they are incentivized to thoroughly review proposals and deliver the best decisions. In this way, Q DAO imbues higher democracy and decentralization, on which many current crypto projects lag.
In addition, all the fees, charged for the system use, can be paid only in Q DAO.
In order to create USDQ, a user needs to transfer Bitcoins into a Collateralized Debt Contract (CDC). This will automatically trigger the smart contract to generate USDQ and send it to the user. In order to change USDQ back into crypto assets, users need to pay back the amount of USDQ they input and the fees, chargeable in Q DAO Tokens. Whenever this is done, USDQ is automatically destroyed and the Collateralized Debt Сontract is closed.
In addition by getting USDQ directly at the company's website, users can trade in USDQ on secondary markets. It's as easy as trading Bitcoin or Ethereum or any other coin.
Traders can store both coins in their wallets, assuring higher security. The stability and ease of use for USDQ open up wide ranges of adoption for both businesses and end consumers alike.
What makes USDQ stand apart
The main difference between projects like Tether and USDQ is complete transparency and openness in the inner workings of USDQ. All the data is easily accessible on the blockchain and there are no rumors or controversies as to the reserves held by the team, potential conflicts of interest or hidden agendas.
The CDС mechanics ensure that it's impossible to create fake units of USDQ, as smart contract can be activated only after an amount in Bitcoins is input. The development is being done completely transparent. Interested parties can review the smart contract, presented on the website. The audits and peer reviews were carried out to assure the highest quality of smart contract. The website-based scanner enables to track all the data about each and every transaction, including time, amount and collateral size.
In addition, should a "black swan" event occur, i.e. a drastic fall in Bitcoin prices, Q DAO is sold on secondary markets. Bitcoin value is liquidated to make a USDQ buyback procedure, which prevents any losses on the part of the system's users.
Additionally, PLATINUM BLOCKCHAIN ENGINEERING which is helping to develop the ecosystem is working hard to build up long-term partnerships with stakeholders in the crypto industry. The more liaisons the team wins, the better outlook for USDQ will be.
Why do we need stablecoins anyway?
Different assets produce varying levels of volatility in prices, when compared to each other. For instance, the purchasing capacity of US dollar has reduced over time with 1 USD from 1913 equaling 24 USD today (2019). This happens due to inflation 3-10% per year.
In comparison, Bitcoin almost tripled in value in 2018 and then fell down by as much. Thus, fiat currencies are more stable, when compared to cryptocurrencies.
Stablecoins don't attempt to fight inflation. Instead, coins like Tether and USDQ peg themselves to US dollar, bringing relatively higher stability to crypto trading communities. One of the most famous transactions with Bitcoin is when a pizza was bought with Bitcoin back in 2010. At that time, the pizza ended up costing just a couple of bucks, but today it costs millions. Although stablecoins continue to be impacted by inflation and exchange rates that come to them from fiats they peg themselves to, they are nowhere near the mindboggingly high volatility of crypto assets.
One of the major use cases for stablecoins like USDQ is concluding long-term contracts. For instance, when using a popular decentralized platform Augur, users can bet on the price of oil in 5-10 years. The problem is that you won't only have to account for future changes in oil prices, but also for prices in Ethereum or Bitcoin that you use to make the bet. USDQ solves this problem elegantly and without much trouble. Using it, users don't have to consider future changes in Bitcoin prices and they can concentrate on what they've come here for - betting on future events. And they don’t have to worry about technical details as it’s easy to purchase USDQ and use for trader’s purposes.
Betting industry is just one of the many use cases, where USDQ can bring benefits. It can be successfully used for any transactions done across borders and long-term financial contracts. Virtually, USDQ opens up new opportunities any time value is exchanged and volatility has a negative effect.
Bottom Line
USDQ has a high potential to democratise transactions between companies and individuals globally, bringing fast execution and low volatility. The "PLATINUM BLOCKCHAIN ENGINEERING" is working hard to enable and improve various features in order to help USDQ to take leading positions on crypto markets.
Here are the main ecosystem’s features:
Taking into account these beneficial features, there's no question that USDQ will become a viable alternative to other fiat-backed cryptocurrencies like TUSD, USDT, GUSD, USDC etc. Competing with other stablecoins, both already operating and just being developed, PLATINUM ENGINEERING will roll out the new features and underlying tech solutions that'll help propel the coin.
USDQ is decentralized stablecoin, which uses algorithms to offer higher stability and reliability. Fully on-chain and monitored by high-speed AI robots, ecosystem offers reliable defences against malicious acts and attacks. First run in line of fiat-pegs, USDQ is brought by PLATINUM ENGINEERING Team, looking to edge together innovative solutions in collateralization, using stabilizing mechanisms for high-endurance stablecoins. Soon there will be even more fully backed stable coins: JPYQ, KRWQ, SGDQ, HKDQ, CNYQ, RUBQ under USDQ brand. Fully anonymous, USDQ breaks limits out of this legacy world.
PLATINUM ENGINEERING values your opinion and welcomes you to continue the conversation on Telegram or Facebook, where the company’s development team is always ready to help you find solutions to pressing issues. Working on projects like USDQ, Michael has gained an invaluable suite of skills and insights, enabling to roll out high-usability UI/UX with tight deadlines and lack of clear expectations as to user behaviors. The team has successfully produced white-label wallets, stand-alone fundraising platforms, as well as integrated fundraising ecosystems. Any startup looking for a reliable partner to help execute a success-story will win from a free consultation with the PLATINUM ENGINEERING team about potential solutions to their needs and issues.
This overview may not be fully exhaustive and does not assess the viability of any project, nor its team legitimacy. Readers should conduct their own due diligence before using or investing in any of the listed Stablecoins. This article represents the author’s opinions only and should not be considered investment advice. All described functionality in the article is still under development, it can be changed/processed. Please follow the updates.
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Support for bitcoin’s lightning network will soon be added by the popular wallet service, Electrum. Bitcoin lightning network being supported by Electrum wallet. Global X change.
Thomas Voegtlin, Electrum’s founder shared with a media source, Coindesk, that the solution for sending lightning transactions with the Electrum wallet is approaching its official release. He discussed this from the BIP001 blockchain event in Odessa, Ukraine. Globalxchange.
Voegtlin said, without revealing a specific release date:
“We’ve been doing this work for about a year in a separate branch [on GitHub] and we’ve reached the point when we are ready to merge it with our master branch. This is going to happen in the coming weeks until the end of July, and it means that the next major release will have lightning support.” Global xchange.
Bitcoin lightning network being supported by Electrum wallet. Several iterations are in development by different projects. The lightning network is an in-development “layer 2” scaling technology that is aimed to enable:
faster payments
lower fees
greater transaction throughput than the bitcoin network can provide directly
Globalexchange. Electrum chose not to integrate with the existing lightning clients. Voegtlin explained that they instead developed their own implementation.
“We want to give users control over their funds,” he said.
Voegtlin further explained that even though the product will be similar to that of Eclair, the lightning wallet, because it uses Electrum servers to interact with the bitcoin network, and Electrum uses its servers for bitcoin transactions, it will not for the interaction with the lightning network. Global X change.
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Three big hurdles to convenient crypto investing are...
Time - How long it takes to convert GBP to your preferred cryptocoin.
Cost - Associated fees with purchasing cypto.
Difficulty - How straightforward the overall process is.
I'm going to run through the method I use to help you break down these barriers, and hopefully make your lives easier if you're looking to put some money into crypto in the future.
Time - Almost instant. Takes a minute or so to transfer.
Fees - None.
Time - Instant
Cost - Current exchange rate. No additional fee.
Why? - Transferring GBP straight to Coinbase puts your funds on hold for 5 days!! While your funds are on hold, you can only purchase BTC through Coinbase (not CB Pro) which comes with extortionate fees. Coinbase has no such quarantine process for EUR deposits, so you can use your currency with zero limitations from day 1 of transfer!
Company Name - CB Payments Ltd
IBAN - EE29 7700 7710 0196 1370
BIC/SWIFT - LHVBEE22
After succesfully adding Coinbase as a beneficiary you're now ready to send your funds across! But first, make sure to get your personal reference from Coinbase. This must be entered on the payment amount screen before you hit Send, otherwise your payment will not reach your account. You can find your personal reference on Coinbase.com as follows...Login -> Go to "Accounts" -> Click Deposit under "EUR Wallet" and follow the prompts to find your personal reference. Enter your transaction amount and ref into Revolut and hit Send.
Time - Same day on weekdays. Usually takes about half a day in my experience.
Cost - Free
Tips - Once deposited, you can now buy the crypto of your choice! When buying make sure to use "Limit" orders and not "Market" as the fees will be lower (for a €32.92 bitcoin purchase I just did, the fee was €0.05 (Only 0.15% fee!)
How? - "Trade" tab -> Select Market, e.g. "BTC to EUR" - > Click "Limit" -> Enter the limit price as the "last trade price" from the top of the screen - > Enter the amount of crypto you want to buy -> Check you're happy with the fee & total, then click Place Buy Order
You've done a same-day crypto purchase with the only fee along the way being 0.15% to buy the cryptocurrency. This crypto can at any time be instantly sold for GBP at the current trading rate (again, use a "Limit Order") and deposited into your Paypal within minutes, and from there to your bank.
If you're looking to invest a little of your beermoney into Crypto on a semi-regular basis, this is a great way to do so without being shafted by delays, quarantines and fees.
Let me know if you have any questions or corrections, as I've putthis together late at night. Happy to here if anyone's found an easier way to get from GBP to Crypto too
Feel free to pop me a PM and I'll send you over a ref link, so you can kickstart your crypto savings with some free EOS and XLM!
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CRYPTO BEGINNERS GUIDE: 5 THINGS CRYPTO NEWBIES SHOULD KNOW
This is a crypto beginners guide to the 5 things crypto newbies should know. Highly recommended for those new to the cryptocurrency market.
The recent cryptocurrency crash is not the first of its kind. If you check the epistemology of bitcoin, you’d find out that every crash comes with a strong rebound. The crash may not be the worst thing to happen. The worst thing is to see the market rise again and then you reminisce saying: ‘Had I known, I should have bought some coins back then’.
Talking about Cryptos may make people around you feel like you’ve lost your head. I keep getting questions inbox — is this not a bubble? Can this be ethically lawful to invest? This is gambling…and I get tired answering some of those questions. However, I tried to put this piece together for newbies, especially millennials who are marvelled by the magic of the crypto world. Alas! You can make good money with cryptocurrencies, in fact, a 1000% returns within a year is pretty common in the crypto universe. It is, however, equally easy to lose all of that money within the twinkle of an eye. Here are a few tips for those who are willing to join the train.
The first step in crypto consciousness is understanding the underlying technology – blockchain. Forget the tech jargons for now. No one needs to convince you of how revolutionary blockchain technology is. A good starting point is reading articles, checking online forums and vlogs discussing cryptos. You’d soon find out why governments and corporations are exploring this nascent technology and how they’re looking to integrate it to their systems, or why banks are fearful of Blockchain and cryptocurrencies as a threat to their existence and looking to clamp down its growth. This outlook will help broaden your mind to learning and seeing the possibilities of the potential of blockchain technology.
It is also important to not make the mistake of trusting someone else with your funds; that defeats the entire purpose of cryptocurrencies, which was created to empower everyone with true ownership of their money without trusting any third-parties such as the banks. It is extremely common for scammers to ride on newbies’ naivety in this unregulated market. This, therefore, calls for extra caution.
In the cause of my extensive research in the early days, I’ve realized a very important rule of the thumb in the crypto markets — only invest what you’re willing to part ways with. This is because the market is exceptionally volatile, one which is fueled by hype and market sentiments rather than fundamental elements. This makes the crypto markets intensely risky; that’s why you have the potential to make loads of money or lose everything instantly. In modern finance, this is exemplified by the relationship:
Risk = Rewards
(Investments that are risky will tend to potentially give you higher returns)
Always exercise caution and please, do not mortgage your house or take out a loan to invest in cryptocurrencies; you’re only signing your death warrant.
Cryptocurrency is not a “get rich quick scheme”. Do not have the sole mentality of pursuing short-term gains, especially if you do not have the necessary trading or technical skills. Let’s face it, many in the crypto markets have no idea what they’re investing in and are in this only for the short-term rewards. This is a recipe for disaster. It is imperative that every investment decision is based on thorough due diligence and patience. Do not be the guy who had 1700 BTC when it valued at $0.06. He sold it for $0.30 and was then lamenting when it reached $8.00. This was back in 2011. Imagine if he had hodled today, it would worth tens of millions today!
Hodl – or hodling – is crypto-slang denoting the act of holding on to your coins or tokens no matter what the circumstance is; be it in a bear market or a strong correction
You should always be focused on the long-term, as the technology underpinning cryptocurrencies are still in its infancy stages and it could take a while before the technologies and various innovations within the cryptocurrency ecosystem are ready for mainstream adoption. Short-term trading in this extremely volatile market could be disastrous, especially if you do not have any trading expertise.
(See also: Understanding Cryptocurrencies: Game of Thrones Edition)
Your cryptocurrency investments should be spread across the market proportionally. There are over 1,600 different coins and tokens in the crypto space.
Never put all your eggs in one basket
Bitcoin (BTC) and Ethereum (ETH) are the oldest and biggest cryptocurrency around and represent the base currency of the cryptocurrency world. Therefore, it is recommended to always have a considerable portion of your investments in both coins as they are relatively stable and facilitates the exchange with other altcoins. (See also: Coins, Tokens & Altcoins: What’s the Difference?)
Thereafter, it is recommended to spread the rest across valuable altcoins with potentials of disrupting their space. Look for coins that solve real-world problems, not shitcoins. You must learn how to identify shitcoinsand coins with good fundamentals.
Shitcoins are coins that do not have good fundamentals and are created with the purpose of scamming the masses. They’re often associated with ‘pumps-and-dumps’ and ponzi schemes, and are a great way to lose your money.
A well-built portfolio is a solid foundation for better returns.
When I first started, I wasn’t taking cognisance of the amount of satoshi a coin was worth. I simply saw those figures as randomly controlled by bots. To the contrary, those numbers determine the value of your coin at any given time. The key to profitability in this area is to buy low and then sell high. You need to pay attention while placing a buy order and as well observe when the market moves in a bullish direction to count your gains. Here’s a guide to calculating your crypto gains. If you can pay good attention to this, you will most likely crush the crypto market like a superstar.
CRYPTO GUIDE 101: CHOOSING THE BEST CRYPTOCURRENCY EXCHANGE
This article takes a look at important factors for you to consider before choosing the best cryptocurrency exchange. We’ve come up with a list of exchanges for you.
There are many available exchanges that you can buy cryptocurrencies at, and navigating the right exchange can be hard. There’s a number of factors that you have to consider in ensuring that you’ve opened the right exchange based on your expectations, requirements, and what’s best for you. The majority of exchanges offers only the top coins, which usually consists of Bitcoin and Ethereum. (See also: Coins, Tokens & Altcoins: What’s the Difference?)
This guide will help you make an informed decision on what exchanges is available, which you should pick, and the factors that are important to consider when opening a crypto account on an exchange.
If you’re new to cryptocurrencies, your first step would be to find an exchange that allows you to deposit money. Due to regulations, all exchanges require you to verify your account before depositing your funds, through the submission of your identity proof and any other personal information. Hence, you should find an exchange in your domestic country first to convert money from your bank account into Bitcoin.
It is important to note that not all crypto exchanges accept fiat money; some exchanges only allow you to deposit coins (most commonly Bitcoin) to purchase other alternative coins. Bitcoin is the most popular crypto that is offered on almost all crypto exchanges, and represents the gateway to purchasing other coins. In other words, if you want buy any other coins, you must do the following:
Step 1: Open a domestic cryptocurrency exchange in your country and verify your account (submit identity proof)
Step 2: Deposit funds from your bank account to your crypto exchange account and start buying Bitcoin
Step 3: Open a crypto exchange account that offers a variety of other coin. Usually these exchanges do not accept fiat deposits and only allows coin deposits
Step 4: After verifying your account, transfer the Bitcoin that you’ve bought from your local exchange to your new crypto exchange and you can start buying other coins with your Bitcoin
Important Note: Trading Fees gets smaller with volume. The ones listed on the table are the max range* (Maker fees are paid when you add liquidity to our order book by placing a limit order under the ticker price for buy and above the ticker price for sell. Taker fees are paid when you remove liquidity from our order book by placing any order that is executed against an order of the order book.)
Once you’ve opened an exchange account that allows fiat deposit, you can link your personal bank account with your crypto exchange account and start depositing funds to buy Bitcoins.
Many exchanges offer only a handful of coins; the most popular being Bitcoin and Ethereum. There are only a handful of exchanges that offer a wider variety of coins. A more diverse option of coins available is better as it gives you more choices of coins to purchase.
Liquidity refers to the ease of buying/selling in the market. A high liquidity means that there is a huge number of buyers/sellers. High liquidity is good as it leads to better price discovery and it allows you to transact faster.
The level and type of security mechanisms employed by an exchange is vital in ensuring that your coins are safe. Examples of good security practices undertaken by exchanges include:
a) Keeping deposits in cold storage; this means that your coins are safely tucked away offline, beyond the reach of hackers
b) Availability of 2-factor authentication (2FA) option; 2FA increases the security of your account
c) Email encryption and verification; for every transaction there will be an email sent to your account to confirm the transaction
(Read also: Guide to Cryptocurrency Security: Activating 2FA)
Having a responsive customer support would save you lots of time and anxiousness, especially in a fast-paced environment. Issues on your verification process, deposit/withdrawals, funds reflection and trading orders should be solved quickly by the exchanges, or it could cost compromise you time, money and well-being.
Low transaction fees on buying and selling would relatively prevent your margins to be eaten away, especially if you’re a constant trader. It is important to look at the fees of your exchange, to see if it’s relatively comparable to other exchanges.
The user interface of the exchange should be easy to use and clean to avoid confusion. Having the necessary indicators at the tip of your fingers and the ease of navigating through the platform should make it easy for anyone to use the interface. (Read also: Guide to Common Crypto Terms)
Choosing an exchange is the gateway to the crypto world. There are many factors to consider when choosing the best exchange, and the aforementioned factors should serve as a guide.
Original Blog Post Link: http://masterthecrypto.com/choosing-the-best-cryptocurrency-exchange/
References are made wherever possible. All statements are based on the author’s experiences. I take pride in informing the public and helping as many as I can through sharing my experiences with my readers. That said, no one except you can take responsibility for your Cryptocurrency Investing decisions, so do think it through before investing.
If you would like to learn more about the techlogogy behind cryptocurrencies, please check out our blockchain courses on crypto.
When I first started taking an interest in cryptocurrency I thought I was so lost in this huge sea of unknowns. Where do I start? What are the useful keywords to look up and keep in mind? What are the available helpful resources? This cryptocurrency investing guide is written so that in just 20 minutes, you would have a sense of what to expect of your upcoming crypto journey, and how to best go about starting it. Enjoy it, it might just be the most exhilarating ride of your life.
Rise of the Cryptocurrencies
As the tech literacy of the population increases, acceptance of crypto as a legitimate store of value follows, and it boomed. Titles along the lines of ‘Bitcoin price hits new all-time high’ and ‘Ethereum price surges’ are starting to perforate the general public’s news feed. What we know for sure is that people who were once skeptical of Bitcoin and the technology behind it are slowly understanding and getting increasingly involved with crypto. As at the time of writing, the market cap of the entire crypto space is at 30.9 billion USD. It was 20 billion just four months ago. What would it be four months from now?
Current Makeup of the Cryptocurrency Space
You would have heard of Bitcoin and the ‘altcoins.’ How this naming convention started was because back in the days of 2011, forks of Bitcoin appeared in the markets. The forks, or clones, each aspire to serve a niche area, aiming to be ‘better’ than Bitcoin. Since then countless new crypto has emerged, eroding away Bitcoin’s crypto market cap dominance. These altcoins are gaining market share at an alarming speed. Ten times or more growth has been observed in a time span as short as six weeks (see PIVX, an altcoin).
Cryptocurrency, Stocks, and Fiat
The currencies we know are referred to as ‘fiat’ by the cryptocurrency community. Although having ‘currency’ in its name, cryptocurrencies share more similarities with stocks than currencies. When you purchase some cryptocurrency, you are in fact buying some tech stock, a part of the blockchain and a piece of the network.
Cryptocurrency Exchanges
The most common place where people buy and trade cryptocurrency is on the exchanges.Exchanges are places where you may buy and sell your crypto, using fiat. There are multiple measures to judge the reliability and quality of an exchange, such as liquidity, spread, fees, purchase and withdrawal limits, trading volume, security, insurance, user-friendliness. Out of all these, I find Coinbase as the best exchange hands down. It has a beginner-friendly user interface, and an unbeatable 100% crypto insurance.
After setting up an intermediary bank account and verifying your details with Coinbase, you are only five simple steps away from a Bitcoin purchase:
When you get acquainted with buying crypto and start to itch for some crypto trading (e.g. BTC/ETH), simply perform an instant transfer from Coinbase to GDAX free of charge and start trading. Think of Coinbase as the place to conveniently buy and store your crypto and GDAX as your margin trading platform. Transfers between the two are instant and free.
As you slowly get familiar with other currencies, you might want to have the option of investing in them. Bittrex and Polo are two exchanges that offer a wide selection range.
When signing up on these exchanges for the first time, do make it a point to verify your account with the required documents early, as you do not want to be caught in the middle of some tedious and slow admin work when the trading opportunity comes. Verification on these exchanges may take days, and purchase/withdraw limits may only increase gradually as you trade.
An additional point to note: if you are using a currency other than USD, do check out the exchange’s ease of funding and withdrawal. You do not want your exchange to come into fiat withdrawal problems like Bitfinex did recently.
Cryptocurrency Wallets
Exchanges have inbuilt online wallets to keep the cryptocurrency you purchased. However, for those who heard of the Mt. Gox hack, you might feel uneasy to put on an exchange. If you do not wish to keep your crypto holdings on the exchange, you have the option to either use a paper wallet service like myetherwallet.com or spend 99 USD on a hardware wallet like KeepKey. Both serve the purpose of removing platform risk, at the cost of taking up the responsibility of keeping your cryptocurrency safe.
To transfer your crypto from exchanges to your hardware wallet for long term storage, simply follow these steps, using Coinbase and KeepKey as an example:
Take note to first send a tiny amount (e.g. 0.0001 BTC) for testing before sending the bulk, lest an error occurred and the transfer amount is lost. A small network transfer fee might be charged.
Personally, I own a hardware wallet, as I love the feeling of a having around a tangible reminder of my crypto holdings. Also, the hardware wallet’s user interface makes it easy to keep multiple coins, which is especially handy when you participate in ICOs (Initial Coin Offering) in the future.
This part will be wildly subjective. Crypto has the potential to realize many ‘rags to riches’ stories, but its volatility makes it unpredictable. As a precaution, the money you put in crypto should be money that you are fine with losing. I cannot emphasize the importance of this as we often underestimate how the volatility affects our emotional capacities. The upside is huge, but it comes with lots of risks and, if I may put it, emotional torment.
A conservative portfolio I would suggest is as follows:
< 30 years old (max) 30% Crypto, 50% Traditional Investments
30 – 40 years old (max) 20% Crypto, 60% Traditional Investments
> 40 years old (max) 10% Crypto, 70% Traditional Investments
This is not meant to be age discriminatory but considers the fact that one takes up more financial responsibilities (mortgage, family) as he grows older.
Within the designated crypto share of your portfolio, you may diversify your coins based on your risk appetite.
Now, this is where it gets exciting.
How do we pick the winner? How do we avoid picking the loser?
Note that crypto is now in a huge bull market and anything could rise over time. Also, do not dismiss the possibility that we may be in a bubble like the-dot-com boom back in 2000. Still, ask yourself these questions before you decide to invest in a coin:
Short Term Trading with Margin
Once you get familiarized with crypto, you may want to trade on your ‘stash’ in hopes of increasing it. For the experienced forex traders, this is nothing new. But for the new crypto investor, you may want to brief up on how to make a leveraged trade.
Short-term trading takes advantages of incoming news to make a quick buck. If you foresee good news from an upcoming release of a coin, you may want to open a long and see how it goes. Remember, buy the rumor, sell the news; act fast and be daring if you wish to make a profit with short term trading.
Mining
For those who are more comfortable with a predictable form of reward, mining is the way. Mining involves setting up of a rig, consisting of GPUs or CPUs and an investment in the electricity. Mining is only possible on cryptocurrencies that follow the Proof of Work protocol. It takes some effort to setup and gets things running, but it is attractive as a long-term passive income as long as you frontload the work.
Staking
Staking is the Proof of Stake version of ‘mining.’ Think of this as making dividends on your stock. The reward rate and staking method differ greatly among Proof of Stake coins, but in general, it takes less effort as compared to mining.
Arbitraging
As you get a hand in multiple exchanges, you may wish to buy from one exchange and sell on another to make ‘arbitrage’ gains when you spot an arbitraging opportunity. Take note of two things if you wish to do so: remember to factor in fees, and remember that the price could change when you are transferring your coin between exchanges, especially during volatile times. USD tends to be liquid so this happens less for it, but for other currencies such as CAD (Canadian dollar) and SGD (Singapore dollar), there may exist more arbitraging opportunities to exploit.
Link the original blog post: https://blockgeeks.com/cryptocurrency-investing/
