Beginner’s Guide to Cryptocurrencies
Well done, you have made your first step into the new world of cryptocurrencies…
Welcome to the Future of Finance
Welcome to a world of lower fees, faster transactions, decentralised cryptocurrencies, privacy & protection against forgery & corruption.
In this simple guide you will learn how to:
(1) Set up a simple cryptocurrency wallet with Coinbase
(2) Send money to your cryptocurrency wallet from your bank account
(3) Buy Bitcoin & Ethereum
(4) Set up an Ethereum Wallet with My Ethereum Wallet (MEW)
(5) Set up an account on a Cryptocurrency Exchange with Bittrex
(6) Buy Ripple
If you complete the steps above, you will now hold some Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP).
If you want an EVEN SIMPLER, EASIER, SAFER, FASTER way to invest in cryptocurrencies and generate high returns whilst lowering risk, we suggest investing in a cryptocurrency fund which is fully managed with cold, secure storage
Click here to learn how to invest in 20+ cryptocurrencies in just a few clicks!
This is a great, simple introduction to the cryptocurrency world and this will be your first, diversified cryptocurrency mini-portfolio. This is the safest, securest way to start investing in cryptocurrencies.
We have chosen these wallets and exchanges for ease of use, security & insurance, not for lowest fees.
The cryptocurrency world is full of hackers, scammers and spammers. We want to set you off on the right foot.
Note: not every country can use Coinbase, please look at our advanced guides for other ways to set up wallets & exchanges in other countries.
How to Set Up a Cryptocurrency Wallet
What is a crytocurrency wallet? A wallet is not like a bank account, it is a digital wallet which is held on your computer, in your browser, on an HD drive, or in a paper wallet stored in a safe (recommended).
If you store your wallet only on your PC and you get a virus, you can lose all your digital information, so we recommend you keep your information on a USB stick or hard drive and backed up in a waterproof, paper wallet preferably stored in a fireproof safe.
The easiest, most secure way to buy a cryptocurrency wallet is with Coinbase. Here is the supported countries list.
Coinbase is currently available in Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Finland, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Malta, Monaco, Netherlands, Norway, Poland, Portugal, San Marino, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland, UK & USA.
Click here to sign in to Coinbase and set up your cryptocurrency wallet.
Cryptocurrency Wallet Keys
Coinbase doesn’t supply your cryptocurrency wallet keys as it is a self hosted wallet, however, if you ever set up a private BTC or ETH wallet, you will need to understand these concepts.
What are cryptocurrency wallet keys?
The public key is your public wallet address. This is the address you want to receive and send coins from. If you are receiving a payment in Bitcoin, you give this address to your friend or client. You also pay from this address.
The private key should be secret. Never give away your private key to anyone… ever! This unlocks your wallet. Only you should have access to this key. This is like your PIN number. Write it down on a piece of paper which is waterproof and put it in a fireproof safe. You can also store it on an encrypted USB or hard drive. We explain more about security and how to use all these in the advanced guide.
How to Buy Bitcoin and Ethereum
Once you have logged into Coinbase and sent them some paper money (USD, EUR, GBP) online from your bank, you can then buy some Bitcoin (BTC) or Ethereum (ETH).
Please watch the video below to learn how to buy Bitcoin & Ethereum and send money to Coinbase from your bank account.
How much Bitcoin should I buy?
The beauty of Bitcoin is you don’t have to buy a whole Bitcoin. At the time of writing, 1 BTC = 7,000 USD.
However, you don’t need to spend 7,000 USD. Bitcoin is divisible to 8 decimal places, so you could in theory buy only 0.00000001 BTC.
However, for practical purposes on Coinbase, you really want to buy at least 200 USD of BTC or you get hit with much higher charges (proportionately).
200 USD = 0.02857143 BTC on 5th April, 2018 for example.
First, let’s think about how much do you want to invest?
For our mini-portfolio of cryptocurrencies, I suggest buying 40% BTC (Bitcoin), 40% ETH (Ethereum) and 20% XRP (Ripple)
So, if you want a $200 cryptocurrency portfolio, you want $80 of BTC, $80 of ETH and $40 of XRP.
If you want a $10,000 cryptocurrency portfolio, that is $4,000 of BTC, $4,000 of ETH and $2,000 of XRP.
How to Set Up an Ethereum Wallet
Once you have bought Ethereum, you want to store it in a safe place. Coinbase does have its own Ethereum Wallet, but in future, if you are to buy tokens, you will need to set up My EtherWallet (MEW). We will go into detail in the advanced guide. But, if you want to participate in ICOs, you definitely want to set up a My EtherWallet (MEW) and it is free anyway.
Click here to Set Up an ETH wallet with MyEtherWallet
Enter a new secure password. I suggest generating a secure password here. Make sure you have saved your password to a secure place.
Follow the instructions to receive your PUBLIC KEY (wallet account number) and PRIVATE KEY (wallet PIN password). DO NOT GIVE YOUR PRIVATE KEY TO ANYONE.
If you want to send or receive Ethereum (ETH), just go to SEND ETHER & TOKENS in your top menu and enter your PRIVATE KEY. If you want to just check your ETH balance in your wallet, go to VIEW WALLET INFO in the top menu bar.
Don’t worry, over time, you will get the hang of this and wonder why this is so much easier than sending money with your bank and at much lower fees!
Please become a member to find out more about Gas, Gwei & Transaction Fees when buying/sending ETH, but for now, you can leave the default options as they are.
How to Set Up a Bitcoin Wallet
Whilst Coinbase does have a Bitcoin wallet, you don’t have access to your private keys. You can read more about the security of a Coinbase wallet here.
For long term storage, you may want to set up an extra wallet with Coinbase’s “Vault”. You can read more info here. You can then use this Bitcoin/Ethereum wallet stored in a Vault as your “deposit account” or “savings account” and your regular wallet can then be used as a “current account: “checking account”.
For added security, we suggest setting up a private Bitcoin wallet where you can access your private keys which you can then back up with a Nano Ledger as well as storing it on a waterproof, paper wallet stored in a safe, preferably in a bank.
We talk more about security and private BTC wallets in our advanced guide to cryptocurrencies.
How to Buy Bitcoin and Ethereum
You can buy Bitcoin (BTC) and Ethereum (ETH) once you have opened and funded your Coinbase account. The Coinbase Wallet & Exchange supports Bitcoin (BTC), Bitcoin Cash (BCH) and Ethereum (ETH). More coins are rumoured to be coming soon.
If you want to purchase Ripple (XRP) and other cryptocurrencies, you will need to set up a cryptocurrency exchange account.
How to Set Up a Cryptocurrency Exchange Account
Once you have set up your Bitcoin (BTC) & Ether (ETH) Wallets, you will want to set up an account at a cryptocurrency exchange. This will allow you to buy most cryptocurrencies. There are many exchanges and we go over them in detail in our advanced guide to cryptocurrencies.
For security and for beginners, we recommend setting up a cryptocurrency exchange account with Bittrex.
You cannot deposit paper money (USD, GBP, EUR) with most exchanges, so you need to purchase Bitcoin or Ethereum first with Coinbase and then send your BTC or ETH to Bittrex.
How to Buy Ripple (XRP) on Bittrex
If you want to buy a cryptocurrency on Bittrex, go to MARKETS in the top menu and scroll down or type in the search box the cryptocurrency you want to purchase, e.g. Ripple (XRP).
The chart below shows the XRP-BTC pair. Scroll down the page and you can see the LIMIT PRICE to Buy & Sell XRP.
The limit price is the MOST amount you would pay for that cryptocurrency, in this case, XRP.
You can also place a sell order at the same time you buy a cryptocurrency to lock-in profits or to stem losses.
This is where it gets exciting and you start to really get involved in the world of cryptocurrencies.
Please download our FREE Cryptocurrency APP below to start exploring cryptocurrency coins, charts, mining, security, shopping, etc.
Click here to learn how to invest in 20+ cryptocurrencies with secure, cold storage in a few clicks!
Please read our advanced guide to cryptocurrencies for all the latest crypto tips & tricks and sign up as a member to unlock access to our market timing signals for buying/selling cryptocurrencies the smart way.