What to do after buying crypto?

This is for folks who have just bought their first crypto without much thought about how to move forward, or those who’re waiting to buy crypto once they know how to use and invest them. The article will take you through the different steps, choices, and opportunities you will have at every step of your journey. You can plan your road by evaluating the pros and cons of every step we have mentioned. 

But first, if you haven’t already purchased your crypto, you can do so here. 

Things to consider before buying crypto

The first big question is whether you wish to invest and use your crypto on a centralized exchange or in a decentralized manner. 

Centralized Exchanges

Centralized exchanges are traditional companies that allow you to buy, trade, invest, and sell cryptocurrencies by providing a platform, developed and operated by the exchange. There are various features of a centralized exchange that may make it a good or bad choice based on your requirements. 

Features of a centralized exchange:

1. User-friendly: Exchange websites and apps are intuitive, and can be navigated without any technical understanding of blockchains unlike in the decentralized world. Exchanges remove the need to hop between different blockchains to buy tokens.
2. Compliant: Most reputed exchanges have begun obtaining licenses that guarantee the legal safety of user funds and data. However, a mandatory KYC is now a part of onboarding any exchange. 
3. Support teams: A unique feature is that you can contact exchange support for any problems, mistakes, or fund losses. In the decentralized system of cryptocurrencies, you are the first and the final authority of your actions; an extra zero can cost you ten times without any resort.
4. Limited options: Most often, exchanges are not the first place where the most innovative tokens are launched. Thus, you may miss the very lucrative early price action by limiting your options.
5. Exchange is the custodian of your assets. While it is safer as exchanges have tight security, even the best of the exchanges have frozen funds, and halted withdrawals and conversions. 

On-chain Decentralised Applications (Dapps) or ‘Web3’

The second option you have is to be your own bank and authority by interacting directly on the blockchain. This is usually the route seasoned people take to access a wider pool of early, micro-cap tokens, decentralized finance, gaming, digital collectibles, and other innovative projects. The perks are plenty, but going this way requires some practical understanding of blockchains and very little room for errors for they may be costly. 

Note that the decentralized platforms can only be used with a ‘wallet’, the address to which is your identity on the blockchain for all purposes. There are wallets like Metamask with many different blockchains readily available. 

Features of decentralized platforms

1. The wallet is your identity: On decentralized apps, your interaction with apps is through your public address(wallet address), and its actions will feature on the blockchain publicly.
2. Actions are irreversible: Once a transaction is signed, it cannot be undone for any reason. A wrong character of the receiving wallet address, or not matching the network can lead to permanent loss of funds.
3. A wider range of activities: With a wallet, and some funds for network fees, you can play games, ‘defi’ your funds into innovative smart contract-based decentralized finance, participate in governance of platforms with DAOs, and much more. 
4. You are your bank: You are the custodian and final authority of whatever is in your wallet, which could be your tokens, funds, images, videos, personal data, certificates, etc. 
5. Tad technical: You must be aware of gas costs, networks, and wallet transactions, and have an understanding of the apps because user-friendliness is still lacking in Web3. 

Now with a basic idea of the features, you are in a position to weigh both options. Typically, centralized exchanges are also the gateway to decentralized applications. If you’re leaning toward decentral, we recommend starting small, and once you are comfortable with a small portion of the funds, you can deploy more. 

Once you have decided, there are plenty of things to do on either side.

What to do on an exchange after buying crypto?

1. Spot trade: The first step in every journey, buy some cheap crypto to sell when prices go bonkers in bull runs. Just spot trading with good timing and risk management can make millions for emotionally regulated traders. 
2. Perpetual: For those with a higher risk appetite, you can deposit a small amount of money (margin), and leverage that margin up to 100x to buy and sell contracts. So you expose yourself to 100x the price action of cryptocurrencies you can actually buy with those funds, making a windfall or losing the margin amount. This is a highly risky option and requires decent trading knowledge to not get wrecked. 
3. Bot trading: If you’re a seasoned trader and understand market patterns, use it to devise automated trading strategies that earn you money 24/7. Or you could see the top-performing bots, and deposit your funds to mirror that strategy.
4. Fixed interest: Most exchanges let you deposit tokens for some percentage return of the same tokens, as lending or ‘staking’ rewards. But be careful of extraordinary returns, because a 100% on a worthless token will still be worthless, not counting the opportunity cost foregone on earning somewhere else. 

What to do in Web3 after buying crypto?

Make sure you have a wallet, a chosen network, some native tokens of that network in the wallet for gas fees payable on each transaction, and some more to use for other activities. We suggest staying clear of Ethereum unless you have a very good reason not to. This is because of exorbitant gas fees for every transaction. 

After checking the boxes, jump into the following:

1. Trade: The first thing you ought to do is try a trade on a decentralized exchange(DEX). Use the tokens you have to buy some other tokens on apps like Uniswap, TraderJoe, Sushiswap, and Pancakeswap. Use a test amount to see the steps, which will include approving the transaction and signing the transaction. Mind the slippage because some tokens may have high slippages beyond 5% where you will lose money in dollar amount for the trade. 
2. NFTs: Browse NFT platforms like OpenSea, LooksRare to look for some art, parcel of metaverse land, game characters, photography, or exclusive club memberships that you may want to buy. Some of them are good for gains, some utility, but most are not a good option to buy. Beware of sly influencer promotions for NFTs, and do thorough research before spending money. 
3. Play: Blockchain has game asset ownership and many possible game economics with tokens representing real value. You can play skill, strategy, and chance games to earn money. Try your hand at a casino in the virtual world, play NFT-based games like Axie Infinity, or strategize to get the maximum wool in Wolf Game that can be worth thousands of dollars. 
4. Govern: Buy the native tokens of a project with a ‘Decentralised Autonomous Organisation’ to vote and put up proposals for the community to improve the platform. Once the community passes it, the resulting code changes are executed on the applications. 
5. Get creative: Use different defi applications to hedge risks, leverage assets for stablecoins, and use them to gain maximum exposure from your funds. Or jump into Sandbox, or Decentraland to build your virtual business, gallery, and much more. 
6. Participate in the ecosystem: Once you get comfortable with the ecosystem, you can graduate from a user to a participant. Remember the tokens you bought in the first step? They were provided by people like you known as ‘liquidity providers’ who earn trading fees and token emissions. Or you could secure the blockchain by staking its native token for interest returns. 

A typical user would go from an exchange to a wallet to eventually participate in the system as it is the most natural journey. There are many opportunities to explore, however, it is important to remain mindful of the real value being used. There are many empty projects, and outright scams throughout the process you need to be aware of. Practice basic wallet hygiene of not signing suspicious transactions, not granting unlimited token access, and keeping your private keys secure to stay safe. 

Good luck, and we will be here to guide you!