A Beginner's Guide To Investing In Wazirx In India

Investing in cryptocurrency in India is a straightforward procedure. There are two ways to invest: mining or via exchanges. Cryptocurrency mining involves verifying and adding transactions to the blockchain public ledger, which can be time-consuming and expensive. The other option is to use a crypto exchange like WazirX, where you can register for an account and trade multiple cryptocurrencies, store them in wallets, and more.

How to sign up and create an account on WazirX

Signing up and creating an account on WazirX is a simple process. Here is a step-by-step guide:

• Go to the WazirX website and click on the "Sign-Up" button. Enter your email address and create a password. You will then need to verify your email address by clicking on the link sent to your registered email. This step is crucial for securing your account, and you will be given two options: using an authenticator app or receiving a verification code via SMS. It is recommended to use the authenticator app as it provides stronger security.
• Set up your account security. After signing up, you will be given the option to proceed with or without completing the Know Your Customer (KYC) process. It is advisable to complete the KYC process to enable P2P trading and fund withdrawals.
• Add funds to your WazirX wallet. You can deposit Indian Rupees (INR) into your account using various payment methods such as NEFT, RTGS, or IMPS. You can also buy USDT through P2P and use it to purchase cryptocurrencies.
• Start trading! With your account set up and funded, you can now buy, sell, and trade various cryptocurrencies on the WazirX platform. Remember to do your research and understand the risks involved before investing.

By following these steps, you can easily sign up and create an account on WazirX, one of India's largest and most trusted cryptocurrency exchanges.

The benefits of investing in cryptocurrency

Investing in cryptocurrency in India has its benefits and drawbacks. Here are some of the advantages:

Inflation Protection:

With inflation, the value of many currencies declines. Cryptocurrency, on the other hand, has a limited supply, which can act as a safeguard against inflation. For example, Bitcoin has a cap on the total number of coins that will ever be available. As a result, the value of Bitcoin will rise due to increased demand, keeping up with the market and preventing inflation in the long run.

Cost-Effective Transactions:

Cryptocurrency transactions are often minimal or free of cost. This is because it eliminates the need for third-party intermediaries like VISA to confirm transactions. Cryptocurrency transactions are also typically faster than traditional bank transfers, which can take several days to settle.

Decentralization:

Cryptocurrencies are not regulated by any central government authorities, making them immune to government interventions. The decentralized nature of cryptocurrency also means there is no single point of failure, enhancing the security of the system.

Global Accessibility:

Anyone with an internet connection can access and transact with cryptocurrencies, making it attractive to investors seeking borderless transactions and investments.

Enhanced Security:

Cryptocurrency transactions are secured by cryptographic techniques and blockchain technology, reducing the risk of fraud and identity theft. The decentralized nature of blockchain also makes it more challenging to alter transaction records.

Portfolio Diversification:

Cryptocurrency is often considered a non-correlated asset class, meaning its price movements are largely independent of other markets. As a result, investors can use cryptocurrency to diversify their portfolios and potentially achieve higher returns.

Potential for High Returns:

Cryptocurrencies like Bitcoin have demonstrated the potential for substantial price appreciation, attracting investors seeking high returns.

Cross-Border Payments:

Cryptocurrency transactions can occur between individuals in different countries without any added difficulty or lengthy processes, unlike traditional financial services, which often involve high fees and delays for international transfers.

A More Inclusive Financial System:

Cryptocurrency provides financial services to people who may not have access to traditional banking, including the billions of "unbanked" individuals worldwide. With a smartphone and an internet connection, anyone can become their own bank and participate in the crypto ecosystem.

Transactional Freedom:

Cryptocurrency allows for the exchange of value between two parties without the need for a third-party intermediary. This freedom is similar to handing cash directly to someone and is especially beneficial for individuals in nations with oppressive government regimes, as it is difficult to restrict access to cryptocurrencies due to their decentralized nature.

While there are many benefits to investing in cryptocurrency, it's important to remember that it is a highly volatile and speculative investment. Investors should carefully research the risks and regulatory environment before making any decisions.

How to buy Bitcoin on WazirX

Step 1: Sign Up on the WazirX Platform

To begin buying and selling Bitcoin, you need to create an account on the WazirX platform. You can sign up using your email address or phone number.

Step 2: Verify Your Email Address

After signing up, you will receive a verification link on your registered email address. Click on this link to verify your email. You will then be given options to secure your account, such as using an authenticator app or receiving a verification code via SMS.

Note on Security:

The authenticator app is generally considered a more secure option, as there is a risk of delayed reception or SIM card hacking with SMS verification.

Step 3: Complete the KYC Process

After choosing your country, proceed with the Know Your Customer (KYC) process on WazirX. This is a mandatory step to be able to trade or withdraw funds on the platform.

Step 4: Add Funds to Your WazirX Wallet

To add funds, go to your account on the WazirX app or web platform. Click on "Funds" and then on "Deposit INR." You can deposit Indian Rupees (INR) using various modes such as NEFT, RTGS, or IMPS.

Alternatively, you can buy Tether (USDT) through peer-to-peer (P2P) trading and use it to purchase Bitcoin. WazirX's P2P feature matches you with other users who want to trade USDT.

Step 5: Buy Bitcoin on WazirX

Once you have funds in your WazirX wallet, you can easily purchase Bitcoin. Go to the "Exchange" tab, choose INR, and enter the amount you want to spend. After reviewing the total INR amount to be paid, click "Buy."

Your order will be placed according to the price you inputted. In the case of P2P trading, you will be matched with a seller who is willing to sell at your desired price, and you can then exchange the tokens.

It may take a few minutes for the order to be completed. Once executed, the purchased Bitcoin will be deposited into your WazirX wallet.

Additional Notes:

• It is important to do your research and understand the risks and volatility of the cryptocurrency market before investing.
• WazirX offers advanced security features, a fast KYC verification system, 24/7 customer support, and a user-friendly interface for both beginners and seasoned investors.
• Always review the fees, withdrawal options, and other platform features before committing to any crypto exchange.
• Cryptocurrency is not a legal tender and is currently unregulated in India.

The different types of cryptocurrency wallets

Cryptocurrency wallets are an important part of your cryptocurrency toolbox. There are several different types of wallets, each with its own features and levels of security. The three main types of crypto wallets are:

• Hardware wallets
• Software wallets
• Paper wallets

Wallets can also be categorised as hot or cold, based on their internet connectivity. Hot wallets are connected to the internet and are more accessible and user-friendly, but they are considered less secure compared to cold wallets. Cold wallets, on the other hand, are offline and don't require an internet connection, making them more secure and less susceptible to hacking.

Hardware Wallets

Hardware wallets are physical devices that resemble USB drives and are considered the most secure type of wallet. They store your private keys offline, making them virtually immune to online threats. Popular hardware wallets include Ledger Nano S and Trezor, which offer top-notch security with a user-friendly interface. These wallets are ideal for individuals holding a significant amount of cryptocurrency who seek a balance between security and accessibility.

Software Wallets

Software wallets are applications installed on computers or mobile devices. They are always connected to the internet, facilitating seamless interaction with DeFi protocols. Software wallets include browser extension wallets, mobile app wallets, and desktop app wallets. Examples of software wallets include Blockchain.info, Coinbase Wallet, Trust Wallet, Electrum, Exodus, and MyEtherWallet. While they offer convenience and ease of use, software wallets are generally considered hot wallets and are therefore more vulnerable to online attacks.

Paper Wallets

Paper wallets are one of the most basic forms of cold storage. They are printed documents containing the public and private keys for transactions, often in the form of QR codes. Paper wallets are highly secure against online hacks but are not user-friendly for everyday transactions. They are also susceptible to physical damage or loss. As such, paper wallets are typically used for long-term storage of cryptocurrencies.

Custodial and Non-Custodial Wallets

In addition to the three main types of crypto wallets, it's also important to understand the difference between custodial and non-custodial wallets. Custodial wallets are provided by third-party service providers, such as cryptocurrency exchanges or online wallet platforms, who manage your private keys and the security of your cryptocurrencies on your behalf. Non-custodial wallets, on the other hand, give you full control over your private keys and cryptocurrencies, allowing you to take responsibility for the security and management of your assets.

How to choose the most reliable cryptocurrency exchange

When choosing a cryptocurrency exchange, it is important to consider several factors to ensure the safety and reliability of the platform. Here are some key points to keep in mind when selecting the most reliable cryptocurrency exchange:

• Security: Always opt for an exchange with robust security protocols, such as two-factor authentication, encryption, and cold storage of funds. Ensure that the exchange has a good track record of protecting user data and funds.
• Reputation: Choose an exchange with a strong reputation and a history of transparent and fair practices. Look for exchanges that are widely recognised and trusted by the crypto community, both globally and in India.
• Variety of Investment Options: Consider the range of cryptocurrencies offered by the exchange, as well as other investment avenues such as staking, lending, and futures trading. A diverse set of options can help you build a well-rounded portfolio.
• Liquidity: Go for an exchange with high liquidity, which will allow you to convert your coins to fiat currency or vice versa quickly. Check the 24-hour trading volume and real-time trading data to assess the liquidity of an exchange.
• Fees: Compare the fee structures of different exchanges, including deposit fees, trading fees, and withdrawal fees. While some exchanges may charge higher fees, evaluate if they offer additional benefits or services that justify the cost.
• Customer Support: Opt for an exchange with responsive and knowledgeable customer support. This is especially important if you're new to crypto investing and may need assistance navigating the platform.
• User Interface: Choose an exchange with a user-friendly interface that suits your level of experience. Some platforms cater to beginners with simple, intuitive designs, while others offer more advanced features for experienced traders.
• Regulatory Compliance: Ensure that the exchange complies with relevant regulations and is registered with the necessary authorities. This can help protect your interests and reduce the risk of fraud or malpractice.
• Referrals and Reviews: Check reviews and testimonials from other users to gain insights into their experiences with the exchange. Ask for referrals from trusted sources to get first-hand accounts of their reliability and performance.

By carefully considering these factors and conducting thorough research, you can make an informed decision when choosing the most reliable cryptocurrency exchange to meet your investment needs.

Frequently asked questions