Since its inception in July 2015 by Vitalik Buterin, Ethereum has remained one of the most talked-about cryptocurrencies in the world. After Bitcoin, it is the biggest cryptocurrency both in terms of market cap and popularity. The cryptocurrency is so large that at its prime, in 2018, 30% of the crypto market was Ethereum alone. No wonder it’s everyone’s favorite cryptocurrency after Bitcoin.
The Ethereum community describes itself as “a technology that’s home to digital money, global payments, and applications”. Clearly, there’s mass belief in that claim. After all, Ethereum’s value rose from $0.4 (its ICO price) to more than $2000 (in February 2021). This isg a rise of more than 5000 times, which means that the conversion rate for one Ethereum to INR went to as high as INR 1.5 lakhs. This staggering increase in price just goes to show how much important the Ethereum network is to blockchain technology.
Even though Ethereum’s price has multiplied by thousands of times over the years, experts continue to believe that Ethereum is still a great investment. Moreover, the volatile nature of the market makes it a good coin for scalping.
To help you manage your Ethereum investments, here are five things to keep in mind while buying or selling Ethereum.
The volatile nature of cryptocurrencies
If you want to buy Ethereum for the long haul, you need to understand that cryptocurrencies tend to be volatile in nature. Hence, sudden dips and rises in price can be expected. During those dips, do not panic sells since, in many cases, the market could make a quick recovery. As Roosevelt says, “Calm seas never make a good sailor,” so when the market is not stable, do not make any quick moves that you might regret. Employ strategies like RCA (Rupee Cost Averaging) and hold on to and trust your investments.
Nature of the market
Even though Ethereum has been a profitable asset and experts are expecting that it will register multiple new all-time highs in the foreseeable future, it is better to check the market conditions and try to buy Ethereum at a price as low as you can. For example, in 2018 if you would have converted one Ethereum to INR at its previous all-time high, the price would have been around one lakh.
To gain 50% profits, you would have to wait three years. But if you would have bought Ethereum in 2021, you could have bought the same amount of Ethereum at INR 20K, multiplying your investment roughly seven times. So it is important to study the markets while both buying and selling a cryptocurrency to make sure to buy cheap and sell when it’s costly.
Following the nature of the market will also help your scalp with Ethereum Since BTC plays a vital role in market movements.
Know the product
Investing in cryptocurrencies for good long-term profits or hedging against stock positions is good but not knowing what you are getting into is not good. Technical analysis could be hard but fundamental analysis is easy. For example, did you know that the Ethereum network already processes more than 1 million transactions?
Understanding the product and product structure can also give you a clear perspective on when to buy and sell Ethereum. Understanding how dominating it is to altcoin markets and how its movements are crucial to other altcoins.
Also, remember that Ethereum isn’t just about ETH, it’s about an entire ecosystem. For example, on the Ethereum blockchain, anything you can own can be represented or traded as non-fungible tokens (NFTs). The success of concepts like NFTs also plays a role in Ethereum’s success. Check out this guide to NFTs for more information.
You can stake Ethereum!
Want to make money just by holding Ethereum? You can actually stake Ethereum and become a transaction validator; in return, you get an amount of ether as an incentive which depends on the number of Tokens staked. So when you actually plan to sell ETH, you basically sell more than you bought; how cool is that?
Always use a good marketplace
It doesn’t matter if you are a trader or a long-term investor; you need a good exchange to trade Ethereum and other cryptocurrencies. An ideal marketplace should be secured, reliable, and should be having pairs you are most comfortable trading in.
If you are an Indian and are considering converting Ethereum to INR or vice versa, you will need an exchange that supports an INR pair for your trades. If you want to arbitrage across pairs or platforms, the exchange needs to have other generic pairs like USDT and BTC as well. For all these needs, check out WazirX for an easy, reliable, and great way to trade and convert cryptocurrencies like Ethereum and INR at minimum cost and high security. Happy trading!
Yes, with exchanges like WazirX, you may invest in cryptocurrency in India. To begin, go to the WazirX website and register. After that, you will receive a verification email. The link received by verification mail will only be available for a few seconds, so make sure you click it as quickly as possible. This will successfully verify your email address. The following step is to set up security, so choose the best solution for you. After you've set up the security, you'll be given the option of continuing with or without completing the KYC process.
Cryptocurrencies can be safe, but your crypto wallets can be hacked if proper security steps are not performed.There are also dangers and uncertainties associated with investments, and we cannot declare any virtual currency investment risk-free. Buying and selling cryptocurrencies does not have to be dangerous if the trader is well-versed in the market and treats his coins with care.
Cryptocurrencies are legal in India, and anyone can purchase, sell, and exchange them. It is currently uncontrolled, as India lacks a regulatory structure to oversee its operations. Per the Ministry of Corporate Affairs, companies must now record their crypto trading/investments within the financial year. In cases where a person receiving the gains is an Indian tax resident, or the cryptocurrency is regarded as domiciled in India, cryptocurrency transactions have been taxable in India
Cryptocurrency can be purchased in two ways: through mining or exchanges. The process of confirming and adding transactions to the blockchain public ledger is known as cryptocurrency mining. Cryptocurrency exchanges are another option. Exchanges make money by charging transaction fees, but there are alternative platforms where you may communicate directly with other cryptocurrency traders.
Crypto or a cryptocurrency is a digital currency protected by cryptography, making counterfeiting and double-spending nearly impossible. Blockchain technology is used to produce cryptocurrencies (a distributed ledger enforced by a distributed network of computers). Cryptocurrencies are distinct in that a government does not issue them. The word "cryptocurrency" refers to the encryption methods employed to keep digital currencies and the network secure.
Cryptocurrency investments are subject to market risks, but if sufficient security measures are not taken, trading accounts can be maliciously accessed. Investments come with risks and uncertainties, and we cannot claim that any digital currency investment is risk-free. Buying and selling cryptocurrencies can be risky even if the trader is knowledgeable about the market and treats their coins carefully.
A cryptocurrency is a digital currency secured by encryption, due to which chances of activities such as counterfeiting and double-spending taking place get close to impossible. Cryptocurrencies get created on blockchain technology ( a distributed ledger enforced by a distributed network of computers). Cryptocurrencies are unique in that they do not get issued by any central authority. The term "cryptocurrency" comes from the encryption techniques used to keep digital currencies and the network safe.
Cryptocurrency mining can be time-consuming, expensive, and sporadically profitable. Mining has an appeal for many cryptocurrency enthusiasts as miners are paid directly with crypto tokens for their efforts. The legality of cryptocurrency mining is dependent on where you live. In India, there is no restriction on crypto mining.
Cryptocurrency has the potential to make you extremely wealthy, and the potential to cause you to lose your money. Crypto assets, like any other investment, come with many risks and potential rewards. Fundamentally, cryptocurrency is an excellent investment, particularly if you want to gain direct exposure to the demand for digital currency.
Virtual currency is a type of uncontrolled digital currency that can only be used online. It is exclusively stored and transacted using designated software, mobile or computer applications, or unique digital wallets, and all transactions are conducted through secure, dedicated networks. Because digital currency is just currency issued by a bank in digital form, virtual currency is not the same as a digital currency. Virtual currency, unlike ordinary money, is based on a trust structure and cannot be issued by a central bank or other banking regulatory organization.