With April Fool’s Day, International Fact Checking Day, Tax Day, Easter, and Passover keeping us busy throughout the month of April so far, we almost forgot to mention the theme of the month: financial literacy. This year marks the 19th time that April has been designated as the National Financial Literacy Month. With a surge in personal finance websites and applications, now is the time — if you haven’t already — to take control of your money and your personal finances and educate yourself. Though many people look at financial literacy as learning to save and better allocate your money for the future, it doesn’t have to be that way. Financial literacy is all about educating yourself in order to understand how best to utilize your money to accomplish your personal life objectives.
For some people, that means living in the present and living life to the fullest now — without a care in the world about what the future might hold. For others, that means having an eye towards the future, saving and investing for a longer-term plan. For those that are thinking about the future, one area to make sure you are financially literate in is cryptocurrencies. For those that want to invest in crypto, but aren’t quite sure of all the options, or even how to actually get involved in crypto, we’ve put together a simple primer on just a few manageable options. Also, if you want to test your crypto knowledge, take our crypto literacy quiz.
Some different ways to buy and invest In crypto
If you’re someone that, when you think about buying and investing in crypto your head spins, we’re here to make sure that no longer happens. We understand that there’s so much information out there and a seemingly endless amount of possibilities of what to buy, when to buy it, and how long you should hold it for — I mean, HODL. Buying crypto can seem complicated, let alone figuring out which institution or platform to use along the way.
Before you get into all the technical aspects of purchasing crypto, you first have to understand the different avenues and channels in which you can buy or engage with the crypto industry. This is not investment advice, but rather just a short list of the different options available when it comes to getting involved in crypto:
Directly buying crypto digitally or with cash:This is probably one of the most common ways in which people get involved in the crypto industry — directly purchasing and storing one or more cryptocurrencies, such as bitcoin, Ethereum, or Litecoin. You can either buy these currencies digitally, through a web-based platform, or you can buy them with physical cash at an ATM.
Buying and investing in cryptocurrency companies:Though buying individual currencies might make some people a little hesitant, another way to get involved is to buy stock in companies with a partial or total focus on cryptocurrency. Your options include cryptocurrency mining companies, mining hardware makers, exchange platforms, transaction platforms, and any other type of company that supports cryptocurrencies with varying levels of crypto exposure. You can also buy stock in companies that hold large amounts of cryptocurrency on their balance sheets.
Buy cryptocurrency-focused funds:If you don't want to choose among individual cryptocurrency companies, then there are options to buy cryptocurrency-focused mutual funds instead. You have a choice of exchange-traded funds (ETFs), such as index funds and futures funds, in addition to a range of other cryptocurrency investment trusts. Some crypto-focused funds invest in cryptocurrency directly, while others invest in crypto-focused companies or derivative securities such as futures contracts.
Get involved with a cryptocurrency IRA:If you want to be involved with cryptocurrency and also garner the potential tax advantages afforded by an individual retirement account (IRA), then you can consider investing in a cryptocurrency IRA. Using the services of a crypto IRA provider may also facilitate more secure storage for your cryptocurrency holdings.
Become a crypto miner or validator:Another way to directly invest in cryptocurrency is to mine it or act as a validator in a crypto network. Cryptocurrency miners and validators can earn rewards in crypto, which they can either hold as investments or exchange for another currency.