The prospect of setting up a cryptocurrency wallet can be enough to discourage many newcomers from the concept of crypto in its entirety. This is understandable, given how getting to grips with the terminology and jargon associated with digital currencies can be a daunting prospect.
But with a little effort, you can quickly learn this new cryptocurrency lingo, as if you’ve been speaking it your whole life. For example, some of the most popular and important terms to memorize are blockchain, address, HODL, mining, and fiat currency.
The blockchain is a specialized distributed ledger system that stores “blocks” of verified transactions. An address isn’t referring to someone’s physical street address, but rather the digital destination that money will be sent to. It’s usually a combination of letters and numbers. HODL is a slang term, that stands for “hold on for dear life”. It refers to the act of holding onto or saving your cryptocurrency, instead of spending, trading, or investing it somewhere. Mining refers to the process of creating new cryptocurrency coins.
Crypto miners work to verify transactions, by sorting them into “blocks”. Miners allow blockchain to function as we know it, and are incentivized to keep things running smoothly, by being rewarded with tokens, each time they verify a transaction. And the last term that all cryptocurrency users should know, is fiat currency. Fiat currencies are any currencies that have been “declared valuable” by a centralized agency. The word “fiat” actually means “by decree”. So fiat money is a currency that has been declared by a central bank. The USD, Euro, and British pound are examples of fiat currencies that rely on a centralized management system. Opposite of decentralized cryptocurrencies.
Nevertheless, it almost always comes as a pleasant surprise to learn just how easy it is to get things up and running. While the concept of a purely ‘virtual’ wallet may seem complex at first, it really couldn’t be easier to set up or manage.
If you have opened an account with PayPal and subsequently made any transactions using it, you’ll find setting up a cryptocurrency wallet just as easy.
The Best of Both Worlds
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There are some guides on the web that suggest first using between the two main types of crypto wallet services available from a long list of providers:
- The most basic functional crypto wallets
- Crypto wallets attached to a decent online trading platform
Frankly, there’s really no logical reason not to go with the latter. Bitvavo is an example of such a platform, which along with making it easy to set up a virtual wallet also provides you with all the tools and features needed to buy, sell and trade crypto coins.
You can set up a third-party wallet to use with a different trading platform if you like, but it is far better to keep things simple and centralized in one place.
A Simple Sign-Up Procedure
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The actual logistics of setting up a cryptocurrency wallet really could not be easier. There are three basic steps to the process, which tend to be relatively similar across most online platforms:
- Step One. Sign up for an account with the provider, at which point your virtual wallet will be created. You’ll need to provide the standard personal data as would be the case when opening similar accounts online, such as PayPal membership.
- Step Two. Link your new account with the bank account, credit card or debit card of your choosing, which will subsequently be used to purchase crypto coins and process transactions. You will usually be asked to submit proof of ID at this point to fully activate your account.
- Step Three. Purchase your preferred virtual currency, in accordance with the exchange rate at the time. Your crypto coins will be transferred to your virtual wallet, which you can then use to make purchases online or trade via the platform for other currencies.
If new to the whole trading idea, it can be useful to browse the platform you plan on signing up with before depositing funds in your account. This would give you a good idea of the professionalism of the provider behind the platform, and whether it is a simple enough service to suit your requirements.
Choosing an Online Exchange as a Newcomer
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Online cryptocurrency trading platforms are becoming simpler all the time, enabling newcomers with no past experience to get up and running with ease. Nevertheless, there are some platforms that are more suitable for beginners than others, which should be targeted by those with no prior knowledge or experience.
A few important tips for selecting your first cryptocurrency wallet and trading platform:
- Use independent customer reviews and recommendations to find an exchange and wallet with a good reputation. Don’t read too much into the recommendations of paid affiliates, which are rarely a reliable source of information.
- Look carefully at the terms, conditions, fees, and commissions outlined by the provider in question. There will always be costs incurred when purchasing and trading virtual currencies, which vary significantly from one trading platform to the next.
- Keep your eye out for introductory incentives or bonus offers, which are usually available for new signups. Though again, be sure to check out the terms and conditions in full, before accepting any bonus or incentive available.
- Start out slow until you get to grips with how the platform works, depositing just a small amount of money in your account and familiarizing yourself with the logistics of it all.
- If in doubt, direct your questions and concerns to the platform’s customer support team. They should be more than happy to help you get to grips with the basics and provide you with a prompt response.
Once again, getting started with a cryptocurrency wallet is no more difficult than setting up and using a PayPal account.
Trading crypto coins to generate revenues takes time, effort, and commitment to pull off, but simply using cryptocurrency to perform everyday transactions really couldn’t be easier.