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During November 2021, cryptocurrency market value increased to the much-anticipated figure of $3 trillion, demonstrating how powerful decentralized currencies can be. By 2022, it will have held at $2 trillion or higher.

Do you think it makes sense in 2022 to invest in cryptocurrencies? Throughout this guide, we answer some of the most common questions about Web3, how to invest in crypto in the UK, build a crypto investment portfolio, and what the future may hold for the top financial asset of the past decade.

In This Guide

How to invest in cryptocurrencies in the UK?

Beginners should purchase cryptocurrencies from a platform licensed by top global authorities and allows them to make transactions in simple steps.

You can learn about cryptocurrency, trade-related information, educational courses, and more at eToro, a place we recommend for investing in cryptocurrency.

The United Kingdom, the United States, Australia, and Cyprus have granted this investing site operational licenses. Twenty million users trust it, and it’s a user-friendly cryptocurrency exchange and a social trading platform where you can read expert comments, price analyses, and trade news.

The eToro cryptocurrency exchange offers a variety of cryptocurrencies. If you would like to buy your favorite crypto asset on this reputable exchange, follow these simple steps:

Step 1: Open an Account with eToro

By clicking the “Join Now” button, you can sign-up for eToro and provide your details. Opening an account is quick and easy.

User information will include name, phone number, email, password, and username. By registering directly with Facebook or Google, one can bypass this step.

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67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Step 2: Upload ID

You must provide your identity proof and the necessary documents to complete the KYC process. This process will take only a few minutes.

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Step 3: Deposit Funds

To deposit funds in your account, you need to click the ‘Deposit Fund’ button once completed the KYC process.

The following payment methods can be used to make your deposit. Optional methods include credit/debit cards, PayPal, Bank transfer, E-wallets, Skrill and Neteller, Trustly, Rapid transfer, etc.

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Step 4: Buy Cryptos

Click on the trade button on the next screen once you have found the cryptocurrency you need in the search box at the top – for example, Bitcoin. Next, enter the amount you wish to purchase and click on an open trade in the box that pops up.

eToro has been regulated by the Financial Conduct Authority in the UK since 2012 and provides a free, secure cryptocurrency wallet. As a result, you can hold your crypto on eToro for a long time.

Why invest in Cryptocurrencies?

Here are some reasons to invest in cryptocurrencies as soon as possible if you are curious about digital currencies but are unsure about doing so:

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Decentralization of cryptocurrencies gives you control over your assets

In the trading of cryptocurrencies, no third parties are involved in your transaction, making it a decentralized form of trading. The cryptocurrencies you store are yours, and you have complete control over them. Furthermore, the prices of cryptocurrencies are not determined by exchanges or brokers.

Cryptos are mostly deflationary

Cryptocurrencies are typically deflationary because of their limited supply. That is, as time goes on, their value increases. There is a maximum limit to the total supply of most cryptocurrencies through an algorithm.

Cryptos are transparent and secure

Due to their transparency and security, cryptocurrencies have skyrocketed in popularity. Blockchain technologies increase security and transparency in crypto transactions, allowing investors to put their money into a huge investment with confidence. Additionally, the fact that cryptocurrencies are open-source and publicly verifiable makes them popular with traders.

Crypto investments could give you big returns

It is well known that cryptocurrencies offer lucrative returns to the general public. Individuals can make informed investments that yield humongous short-term and long-term returns with expert advice, price history analysis, and other important factors.

The availability of diverse cryptocurrencies such as Dogecoin, Ripple, and Binance Coin allows investors to diversify their portfolios and increases the chances of making money through their transactions.

Crypto trading provides you with the necessary independence and flexibility

Trades can be done at any time to suit every trader’s schedule. All investors and traders have access to the crypto market at all times during the day, giving them the freedom to make trading decisions at any time after thorough research and analysis.

Where can you buy crypto in the UK?

Beginners can sometimes find it challenging to select the right trading platform. For this reason, we have compiled a list of websites that intuitively facilitate cryptocurrency trading.

1. eToro – Overall Best Place to Invest in Crypto UK

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We strongly recommend using eToro as the best platform for buying Bitcoins in the UK. The platform stands out because it is highly regulated, unlike other cryptocurrency trading platforms. It holds licenses from the UK’s FCA, CySEC, and other Tier-1 agencies across the globe. As a result, you can invest with eToro with total confidence that the capital you put into it is highly secure. Few other cryptocurrency trading platforms can offer you this level of security. Furthermore, you can also trade various cryptocurrencies other than Bitcoin on the platform. Some examples are Ethereum, Cardano, and Ripple.

Depending on your location and jurisdiction, it is also possible to trade derivatives on the major cryptocurrencies eToro offers. Depending on your account’s currency, you can either trade Bitcoins themselves or for other cryptocurrencies. Depending on your preferences, you might sell BTC for USD or BTC for ETH. Because eToro does not charge commissions, they earn their revenue from the spreads they charge on your trades.

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Pattern recognition and momentum analysis play an important role in cryptocurrency trading, especially in Bitcoin. However, beginners may not trade as effectively as their more advanced counterparts. Using eToro’s copy trading tools, you can copy other experienced traders, where the passive trading tools come in. Go to their copy trading option and filter through over a thousand traders based on their gains, the instruments they trade, and the number of copier accounts they have. Once you have selected a trader you wish to copy, it is as simple as clicking on copy and selecting the right amount you wish to allocate towards copying their trades. eToro allows its users to deposit funds easily using various payment methods, including debit/credit cards, bank transfers, and e-wallets like Paypal.

eToro fees

Fee Amount
Stock trading fee Free
Forex trading fee Spread, 2.1 pips for GBP/USD
Crypto trading fee Spread, 0.75% for Bitcoin
Inactivity fee $10 a month after one year
Withdrawal fee $5

Pros:

  • Bank transfers and debit/credit cards accepted
  • Easy-to-use platform with a user-friendly interface
  • Copy-trading and other social trading features are available
  • Regulated by various agencies around the world
  • In certain areas, it provides cryptocurrency derivatives
  • Trades are not subject to commissions

Cons:

  • Not suitable for technical analysis or advanced charting

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

2. Binance – Top-Rated Crypto Exchange to Invest in Crypto UK

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As far as daily cryptocurrency trading volumes are concerned, Binance is the world's largest crypto exchange. Binance, a company founded in 2017, has achieved humongous success within just 4 years since its inception.

This crypto exchange does not charge fees for users' deposits; however, users are charged fees whenever they trade on this platform. Investors on this platform can reduce this fee by using BNB.

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This exchange uses high security and safety standards to protect its users' sensitive information. In addition, this exchange is known for its liquidity. Besides Bitcoin, Ethereum, Litecoin, Dogecoin, and others, it allows trading in more than 500 cryptocurrencies.

The Binance exchange requires users to submit their KYC information to trade. This platform offers various services, including staking, conversion of cryptocurrency into fiat currency, and more.

Binance fees

Fee Amount
Crypto trading fee Commission, starting from 0.1%
Inactivity fee Free
Withdrawal fee 0.80 EUR (SEPA bank transfer)

Pros:

  • Featuring numerous technical indicators on an advanced charting platform
  • Over a hundred pairs are supported
  • Commissions are very low
  • Supports deposits in fiat currency
  • BNB users receive additional discounts due to low fees

Cons:

  • Deposits made with credit/debit cards are subject to a 2% fee
  • There can be delays in customer service responses

Your money is at risk.

3. Coinbase – The Largest Crypto Exchange in the United States Available in the UK

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Coinbase was founded in 2012, and it operates both as a crypto exchange and a wallet. In over 100 countries, about 73 million people use it. In addition, it is trusted by over 10,000 institutions and 185,000 ecosystem partners.

Buying, selling, and dealing in cryptocurrencies is easy for beginners on this website. It ensures the security and safety of users' information on its platform and provides a healthy trading experience to all of its users. For extra security, almost all cryptocurrencies are stored using two-factor authentication (2FA).

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It offers a wide range of digital currencies and charges fees for trading on its platform. To trade on this user-friendly platform, users must deposit a minimum amount.

Coinbase fees

Fee Amount
Crypto trading fee Commission, starting from 0.50%
Inactivity fee Free
Withdrawal fee 1.49% to a U.S. bank account

Pros:

  • Featuring numerous technical indicators on an advanced charting platform
  • Support for hundreds of pairs
  • Cryptocurrency beginners will find it easy to use
  • Support for a wide range of cryptocurrencies
  • Cryptocurrency earning opportunities
  • Coinbase Pro offers lower pricing

Cons:

  • Deposits made with credit/debit cards are subject to a 2% fee
  • Responses to customer service requests may be delayed at times

Your money is at risk.

4. Kraken - Excellent For Investing in Bitcoin in the UK

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Founded in 2011, Kraken is one of the oldest and largest cryptocurrency exchanges globally. In 2013, it launched a Bitcoin trading platform, and since then, it has amassed over 4 million users in countries around the world. On its platform, users can trade 66 different cryptocurrencies and staking them. Kraken is distinguished because it is regulated by FinCEN in the US and FINTRAC in Canada as a Money Services Business (MBS). In addition to the UK FCA, Australia's AUSTRAC, and Japan's FSA, some of its affiliates are also regulated by those agencies.

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Kraken provides some of the industry's best safety and security features, and it allows traders to trade futures based on cryptocurrency, which most other platforms don't offer. Moreover, it is quite simple to use, and a wide variety of currencies are available to trade on large margins. Kraken, for example, offers leverage of up to 10x on BTC trades.

Kraken fees

Fee Amount
Crypto trading fee Commission, starting from 1% per trade for sellers. Free for buyers
Inactivity fee Free
Withdrawal fee According to the currency withdrawn. 0.0005 for BTC

Pros:

  • Featuring numerous technical indicators on an advanced charting platform
  • The trading of 66 pairs and futures is supported
  • Beginner-friendly cryptocurrency
  • Margin trading allowed
  • Earning cryptocurrency through staking
  • The lowest pricing in the industry

Cons:

  • Methods of depositing and withdrawing are limited
  • The response time of customer service can sometimes be delayed

Your money is at risk.

5. Evonax - Lower Fees to Invest in Crypto UK

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The Evonax trading platform is the perfect choice for experienced crypto traders who seek anonymity on the trading platform. The company was founded in 2016 and offered zero-fee cryptocurrency trading. Its platform is different from others because it charges no transaction fees.

In addition to being present in over 100 countries, this platform has attracted investors from all over the world. Its user-friendly interface and secure technology protect users' sensitive data.

As mentioned earlier, you are not required to provide Know Your Customer (KYC) information to this platform. Users would only be required to provide this information if they required customer support.

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Evonax fees

Fee Amount
Crypto trading fee Vary between 1-3%
Inactivity fee Free
Withdrawal fee Free

Pros:

  • User-friendly
  • No registration or KYC required
  • Transfers in an instant
  • Excellent customer service

Cons:

  • The number of cryptocurrencies is limited to 18
  • There is no crypto wallet service
  • Live Chat is not available

Your money is at risk.

Invest in Crypto UK - Fee Comparison

Platform Crypto trading fee Inactivity fee Withdrawal fee
eToro Spread, 0.75% for Bitcoin $10 a month after one year $5
Coinbase Commission, starting from 0.50% Free 1.49% to a U.S. bank account
Kraken Commission, starting from 1% per trade for sellers. Free for buyers Free According to the currency withdrawn. 0.0005 for BTC
Binance Commission, starting from 0.1% Free 0.80 EUR (SEPA bank transfer)
Evonax Vary between 1-3% Free Free

Best Crypto to Invest In

Which cryptocurrency is the best to invest in? Every beginner has the same question when investing in the crypto market. However, if you plan to earn enormous profits from your investment, bitcoins would be the perfect investment avenue for you.

Crypto price charts have always made headlines since Bitcoin launched in 2009. In addition, recent financial market developments have been attributed to cryptocurrencies' popularity. Since Bitcoin represents a significant portion of the overall crypto market capitalization, it is an obvious choice for any investor looking to gain an edge in the market.

Market capitalization for this cryptocurrency is approximately $3 trillion. It reached a new all-time high of $69,000 in November 2021. With Bitcoin as the leading payment processor, Visa and Tesla have accepted it for making payments. It can be accepted as a currency, sets it apart from many other currencies, and gives its users multiple advantages.

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According to Bitcoin's long-term price predictions, Bitcoin could reach $330,000 by the end of 2025, making it the best investment in long-term growth. However, because of its deflationary tendencies, bitcoin retains its price dominance in the crypto charts.

Although this crypto has also seen bearish trends, its strong fundamentals and old market presence have made it less vulnerable to price crashes. Moreover, with this currency's increasing adoption into mainstream usage, investors and traders can take advantage of enormous market opportunities.

Major cryptocurrencies to invest in

ETH (Ethereum)

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The entire crypto ecosystem places Ethereum second in market capitalization behind Bitcoin. In terms of decentralized financial exchange, it is a leading altcoin that uses a consensus proof-of-work method. However, it is considering switching to proof-of-stake in the future.

With the open-source, decentralized blockchain network, decentralized applications (dApps) and smart contracts can be created and utilized without the interference of any third party.

Ethereum is the best alternative to Bitcoin due to all these features. In addition, a decentralized collection of financial products has been created for Ethereum that can be accessed by anyone around the world irrespective of their nationality, faith, or any other parameter.

Since its launch in the financial market, it has been one of the most successful cryptocurrencies. Ethereum has been able to bring a smile to its investors many times with its increase of more than one hundred thousand percent in value since its launch.

Ethereum's long-term price predictions suggest it will cross the $15,000 mark by the end of 2025, so experts expect the price of this cryptocurrency to increase in the upcoming years.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

ADA (Cardano)

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Cardano is a cryptocurrency that runs on the Ouroboros blockchain platform that utilizes proof-of-stake. The market capitalization of this cryptocurrency ranks sixth in the cryptocurrency market. In addition, its use of fewer energy resources for validating transactions makes it a popular alternative to Bitcoin.

Founder, Charles Hoskinson, founded Ethereum as well. Despite having a similar founder, the two currencies are governed by distinct systems. A proof-of-stake Ouroboros consensus mechanism is used by Cardano, while Ethereum uses a proof-of-work blockchain system.

Dano aims to be the "most environmentally sustainable blockchain platform." Cardano has a competitive advantage over other Blockchain technologies because of its proof-of-stake mechanism. Interoperability, scalability, and sustainable development are the goals of this cryptocurrency.

Is Cardano a good investment? As predicted by experts, Cardano's price will soon be in two digits. According to the Cardano long-term forecast, it will reach $10 by the end of 2025. Moreover, investors are also attracted to this crypto due to its resilience, as its price does not fluctuate much during a market crash. Cardano is a good candidate for your investment portfolio due to its promising performance in the last few years.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

XRP (Ripple)

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In the Ripple network, XRP is the native cryptocurrency. XRP Ledger uses this currency for remittances and international currency exchange. On the XRP network, this crypto is generally used as a bridge between transactions using different currencies. According to its market capitalization, XRP is currently the 8th largest cryptocurrency.

Comparing XRP with other digital currencies and payment methods such as SWIFT is generally faster, cheaper, and more scalable. For example, compared with Bitcoin (7 transactions per second) and Ethereum (15 transactions per second), Ripple can process 1,500 transactions per second.

The XRP token has already been created by its ledger and is thus unable to be mined as it is a pre-mined asset. Nevertheless, by the end of 2025, Ripple prices are expected to reach $4.58.

Small cryptocurrencies to invest in

The best way to invest in small cryptocurrencies is by keeping track of prominent ones that could be a good source of revenue if they are selected wisely. Therefore, we have listed a few important cryptocurrencies below that you should be following regularly:

DOGE (Dogecoin)

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Dogecoin was the coin of the year in 2021. The Shiba Inu on its logo references the popular doge meme. However, at the beginning of 2021, investors didn't pay much attention to Dogecoin.

The price charts of this meme coin increased in value after Elon Musk tweeted about it. As soon as the cryptocurrency was listed on popular trading platforms like Coinbase, traders gained confidence in it. Thus, the crypto reached its all-time high value this year, equalling $0.74 (£0.55). That represents a twenty thousand percent increase in value from its launch in 2014.

According to its market capitalization, this cryptocurrency currently ranks 11th. The supply of Dogecoins is uncapped, which means there is no upper limit on how many coins can be mined.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Shiba Inu (SHIB)

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In August 2020, Shiba Inu was launched to compete with Dogecoin in the crypto market. With a total supply of 1 quadrillion coins, it was founded on the Ethereum blockchain. As a result, the digital finance market has quickly gained significant traction with this cryptocurrency.

Since it was launched to compete with Musk's favorite coin, it has attracted the attention of investors. Based on the market capitalization of its crypto assets, it is currently ranked 13th. Furthermore, after its listing on Coinbase, the largest US-based crypto exchange, its value increased by 40 percent, bringing it to the forefront of the crypto world.

With an average daily trading volume of $219 million, the price of this cryptocurrency fluctuates between $0.00000667 and $0.00000701. However, the token's unique dog icon is what makes it stand out. Many artists around the globe have been inspired by this icon and are working to ensure that it is secured in the non-fungible token market.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Polkadot (DOT)

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The Polkadot network uses the DOT token as its native token. Data and assets can be transferred across blockchains using Polkadot. Multi-blockchain technology is integrated across its network, providing high security and scalability. This platform uses DOT to secure its network and connect new chains.

Polkadot uses a proof-of-stake consensus mechanism to secure its network and validate its transactions, unlike Bitcoin and Ethereum. As a result of staking and participating in the network, users can also earn rewards in DOT.

Its market capitalization currently ranks 9th. Polkadot has allocated 1 billion DOT tokens so far. Their initial coin offering was held in October 2017. The tokens were launched at $0.29 each.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

New cryptocurrencies to invest in

Cosmos (ATOM)

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Decentralized blockchain technologies, such as Cosmos, allow scalability and interoperability between multiple blockchains. ATOMS are the native crypto-assets of Cosmos. Users stake ATOM tokens for network maintenance on proof-of-stake chains.

Cosmos uses the native Tendermint BFT byzantine fault-tolerant consensus engine to ensure that blockchain transactions are processed as quickly as possible. The Cosmos SDK platform, on the other hand, allows developers to develop convenient frameworks for integrating blockchain technology into real-world applications.

In terms of market capitalization, Cosmos is currently ranked 33rd, and its value is expected to increase in the upcoming years. The second half of 2021 saw this cryptocurrency reach an all-time high of $44.80. Since the start of the year, it has grown by more than 400 percent.

Curve (CRV)

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Curve DAO, built on the Ethereum network and founded in 2015 by Russian physicist Michael Egorov, is a newly launched decentralized finance (DeFi) protocol. The CRV token, launched in 2020, is part of the automated market maker protocol. To vote on governance, the native token gets locked.

Users of Curve can trade cryptocurrency using pools of digital assets maintained by users. By depositing on the platform, users can earn fees. The market capitalization of this token is currently $1,740,403,258, and it is ranked 73rd by market capitalization.

The price of Curve is expected to drop to $14.44 by 2025. However, as of its current trading price of $4.02, its value could multiply tenfold over the next three years. As a result, this cryptocurrency makes for a good investment option for investors who want to invest in cryptocurrencies for a long time.

Solana (SOL)

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Many crypto enthusiasts have referred to Solana as the "Ethereum Killer." With Solana, you can get rid of the limitations in Ethereum. The platform uses SOL to process transactions.

The scalability of this blockchain is enhanced through a combination of a proof-of-stake consensus mechanism and a proof-of-history mechanism. As a result, the Solana protocol could execute around 50,000 transactions in a second without compromising the decentralization principle.

Its retail investors saw tremendous profits in 2021 when Sol had its dream run. In early September, the price of this cryptocurrency jumped from $0.75 to $214.96. That resulted from the launch of NFTs by Degenerate Ape Academy on its platform, which contributed to its growth and popularity.

Best cryptocurrencies to invest in 2022 for the long-term

Cryptocurrency prices are known to fluctuate frequently. Market crashes and significant price increases have plagued this industry over the years.

As a result, experts have always urged investors to diversify their portfolios if they are looking to invest for the long haul. This section will give you recommendations about which cryptocurrencies are most suitable for long-term investment and how much of your money you should put into each one.

Bitcoin will be the obvious first choice when it comes to long-term growth. By 2025, Bitcoin will reach $300,000 and reach $380,000. Because Bitcoin is the most widely known crypto among the general public, its importance will continue to rise as mainstream acceptance of cryptocurrencies increases.

You do not want to risk your money on Bitcoin to protect your investment. Therefore, Ethereum should be your next choice for crypto investing. Digital currency has performed well recently. In 2021, it reached an all-time high of $4,850. It represents the best alternative to Bitcoin, and it may overtake Bitcoin one day in what traders call 'the flippening.'

Bitcoin or Ethereum investors have almost always made money, whereas many other cryptocurrencies have failed and been abandoned. That means that it would be smart to maintain the majority stakes in these currencies in your portfolio, let's say 40% each.

Those remaining (20%) can either be majors such as Cardano or newer coins with small market caps such as SOL or CRV, providing a high return on investment (ROI) in a bull market.

Best cryptocurrencies to invest in 2022 for the short-term

The best coins to invest in when you plan a short-term investment in cryptos are those whose prices increase whenever they are in the news. For example, Shiba Inu could make investments whose price significantly increased when listed on a recognized crypto exchange.

In addition to crypto gaming's popularity, Axie Infinity has also gained investors' attention. That is because users of Axie Infinity have the opportunity to earn tokens by demonstrating their gaming skills. In the upcoming years, crypto gaming will gain popularity among all gaming enthusiasts.

One could also watch for Floki Inu, an Ethereum blockchain ERC-20 token. All dog-themed meme coin fans refer to it as the next Shiba Inu. As well as play-to-earn games, Floki Inu's flagship product, Valhalla, offers play-to-earn games. It has been growing steadily ever since it was launched.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

How to build a good crypto investment portfolio?

How many cryptos do you need to invest in?

You could be at risk if you have an insufficient number of cryptocurrencies in your wallet. On the other hand, your wallet will reap benefits in the long run if you have both volatile and stable coins. In addition, many investors open accounts on multiple crypto exchanges and brokers to gain access to different altcoins.

How long would you need to hold your investment?

Volatility and unpredictability are characteristic of the cryptocurrency market. Therefore, investing over a certain period is not possible because the duration of each investment depends on factors like the nature of crypto, market factors, and news regarding the market.

Nevertheless, if the price of cryptocurrencies crashes, one must realize that bear markets will last for three years. However, it is only after thorough research and analysis that you can decide the duration of the crypto investment.

How much would you need to invest?

You shouldn't invest all your net worth into cryptocurrencies, especially volatile and unpredictable altcoins. However, keeping some capital aside to buy the dips is not a bad idea, even if you're bullish on crypto as a long-term investment.

Depending on your disposable income, you may adjust that figure accordingly. In addition, do not invest too much money in cryptocurrency as this would bring unnecessary risk to you, and do not invest too little (say $50) expecting to become a millionaire.

You can open multiple cryptocurrency exchange accounts to split up your money, keeping some of your money in Bitcoin, which has never experienced a 90% price correction or higher, as many altcoins have.

How to store your crypto investment in a secure wallet?

In general, cryptocurrency is like computer code. However, unlike traditional fiat currencies, cryptocurrencies can't be stored physically. Therefore, we need crypto wallets to store or trade cryptocurrencies by interfacing with blockchains. Crypto wallets are hardware or software products that allow for the storage or trading of cryptocurrencies.

eToro Money Wallet

Due to its availability on both Android and iOS devices, the eToro money wallet is very convenient to use. In addition, there's an inbuilt feature that offers conversion functionality and allows the storage of over 120 cryptocurrencies.

Users of the digital wallet do not lose their backup phrase as this service is highly secured on-chain. Furthermore, this wallet is regulated by the Guernsey Financial Sector Commission (GFSC), and it is provided by eToro X Limited, a Gibraltar-incorporated limited liability company.

All crypto enthusiasts prefer its easy, simple-to-use interface. On the eToro wallet, there is a 1% conversion fee, and the minimum transaction amount is $125. As of now, this wallet provides the best security for storing your digital assets.

Coinbase Wallet

As well as a separate crypto wallet, Coinbase is a reputable crypto exchange. This wallet has the advantage of not requiring users to have an account with Coinbase to use it. It does, however, facilitate quick transfers to Coinbase.

The wallet allows you to store more than 500 cryptocurrencies and many different non-fiat currencies. Moreover, this wallet ensures high security for your information and funds, thanks to biometric authentication and optional cloud backup.

Binance Exchange Wallet

You can earn rewards and store cryptocurrencies using the Binance crypto wallet by staking your coins. About 10 million people worldwide use this wallet, which is available as a mobile app. You can buy, trade, or exchange hundreds of cryptocurrencies through the wallet's easy-to-use interface.

Security and risks of crypto investing

Volatility is the most significant risk associated with cryptocurrencies. Its price could change dramatically if there are unanticipated changes in the market. In addition, it should be remembered that cryptocurrencies can lose their value in hundreds, if not thousands, of dollars at a time.

When trading on cryptocurrencies, technical glitches, hacking, errors, and other human errors can also occur. In addition, considering that the market is unregulated, scams and corruption are possible. For example, a hacking incident in 2011 resulted in more than $450 million worth of cryptocurrency being stolen from Mt Gox. However, the money was eventually repaid to those who lost their money.

Hard forks and discontinuity are also risks associated with crypto trading. On price charts, hard forks are marked by significant price variations. In addition, beginners are more vulnerable to frauds or scams in crypto trading, making it more important to avoid pump and dump groups, obvious Ponzi schemes, and leverage trading.

Considering all these risks, dealing with a reputable crypto exchange and using a high-security wallet is imperative. The eToro platform provides all these essentials by offering a wallet with a secured private key and a free recovery service. Furthermore, even though crypto may not be regulated, the exchange is governed by the FCA, ASIC, and CySEC.

Is cryptocurrency mining a better investment?

Using a blockchain platform, transactions are validated and recorded by mining. The crypto industry offers many ways to mine. For example, Bitcoin and Ethereum use the proof-of-work consensus mechanism, where miners must prove their work before a block can be added to the blockchain.

The miners are rewarded for their labor throughout this entire process. Nonetheless, this process is very expensive because it requires specialized equipment, enormous computing power, and a great deal of electricity.

Proof-of-stake mining is another famous cryptocurrency mining method. With this mechanism, miners are responsible for adding a new block to the blockchain by allocating some cryptocurrency coins. The miners need to stake their cryptocurrencies to complete this process. To mine adequate cryptocurrencies, a miner needs an ample supply of coins.

For miners to mine more currencies, all mining mechanisms are time-consuming and require significant investments. As far as Bitcoin and Ethereum are concerned, it is more complicated because it requires so many resources and time.

Is cryptocurrency staking a better investment?

A staking account lets you store cryptocurrencies on a platform and earn interest or rewards by holding them for a while. In other words, this is how stake-based strategies work. Depending on the number of cryptocurrencies in your pool, you would earn a percentage yield.

You must stake more coins to increase your earnings. Many crypto enthusiasts have become very interested in staking lately since they can earn passive income through rewards or interest. Staking Ethereum 2.0 will bring a wave of change to the industry.

Nevertheless, staking also carries some risks. For example, a few small crypto exchanges and decentralized protocols have been hacked in the last few years.

ETH, ADA, and TRX are the three coins that can be staked to earn passive income on eToro. By investing in cryptocurrency, you speculate on its value rising over time and compound your portfolio by earning additional coins.

Selling your cryptocurrency investment

Investing in crypto is especially risky, as the price can always crash back to where you entered, so you should de-risk once you have made a big profit. The conversion of any cryptocurrency into cash, Bitcoin, or stablecoins like Tether (USDT) is instant.

To ensure your transaction is secure and safe, you should always sell cryptocurrency on a regulated platform. We recommend eToro as our top exchange to sell cryptocurrency because they are internationally licensed and accept bank wires, PayPal, Skrill, Neteller, and other withdrawal methods.

Cryptocurrencies can be sold using eToro in a few simple steps. After logging into your account, you must first enter the withdrawal channel. Lastly, make sure your account has the minimum withdrawal amount ($30) and that you have closed all active positions (open trades).

As soon as your available balance is reflected on the bottom left corner of the menu, you can begin withdrawing funds by clicking on withdraw funds. If you withdraw money, keep in mind the $5 withdrawal fee. Your investment money can be withdrawn after you've selected your withdrawal amount and channel.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

Taxes and regulations regarding crypto in the UK

As cryptocurrencies become more popular, many countries have made laws concerning their taxation. In addition, cryptocurrencies are taxed in the UK, where they are treated as property and therefore are taxed.

To determine if cryptocurrency transactions are taxable or not, Her Majesty's Revenue and Customs (HMRC) has issued guidelines. A similar tax rate is applied to these digital assets to ordinary income. Any losses incurred while holding crypto-assets can be deducted from the taxable income generated by those cryptocurrencies and carried forward to the following year.

Tokens are subject to capital gains tax in the following scenarios: they are sold, they are received from employment or mining, they are exchanged from one cryptocurrency to another, they are used to buy goods and services, they are given to another individual except when given as a gift to a spouse or civil partner.

Conclusion

The finance industry's future will be shaped by cryptocurrency for years to come. Over the past few years, the crypto market has grown exponentially. As a result, regulators cannot ignore this trillion-dollar industry. For this reason, governments recognize these digital currencies informally or formally.

As an example, Goldman Sachs, once skeptical about the future of crypto, has now stated in publications that allocating a certain percentage of your portfolio to blockchain-based assets makes sense. That is because cryptocurrencies will transform the way we buy and sell goods and services within a few years.

Despite the volatility of crypto assets, investors have found that they can make huge returns on their investment through market research and analysis.

You can do all your background research regarding any crypto investment by visiting social trading leader eToro that will provide you with expert opinions, trading strategies, crypto price analysis, and other amazing stuff that will assist you in making a knowledgeable decision.

In addition to training new investors how to invest in cryptocurrency in the UK, the UK-regulated online broker can also be a great help. Copy trading is its most well-known feature, allowing you to mimic experienced traders' trades.

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67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.

FAQs

How much to invest in crypto?

How much you invest depends entirely on your preferences, disposable income, and other factors. Nevertheless, do not invest too much money in cryptos as that would be a risk to you, and do not invest too little (say $50) as that would be very ineffective.

How many people are investing in cryptocurrency?

It is estimated that over 100 million people have begun investing in these digital assets, even though there is no exact data regarding how many people are investing in cryptocurrency. According to some sources, around 10% of the world's population is reportedly investing in cryptocurrencies.

How to learn to invest in cryptocurrency?

Invest in cryptos with the eToro trading platform. The platform gives you information like how to start investing in cryptos, what your portfolio should look like, your trading strategies, price analysis, expert comments, market-related news, and so much more.

How to invest in Bitcoin ETF?

Go to the eToro markets page after you have created an account on the platform. Choose the ETFs you want to trade in, and choose the fund you want to deal in. After clicking on the trade button, you can begin trading that ETF.

Are banks investing in cryptocurrency?

Standard Chartered Bank of London, BNY Mellon, Citibank, etc., are just some of the big banks that have started investing in cryptocurrencies.

What is the best cryptocurrency to invest in?

A trader, who intends to make enormous returns on his investment, should consider Bitcoin as the best investment avenue considering the current price trends. There are also very promising forecasts for Bitcoin's future price. By 2025, it is estimated to reach $330,000, for instance.

About Jhonattan Jiménez
About Jhonattan Jiménez

English Language professional with a vast experience teaching English as a second language, English translator to Spanish, Cryptocurrency enthusiast, interested in geopolitics and economy.

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