Cryptocurrency is a virtual asset used to validate transactions and keep crypto records. The entire cryptocurrency operating system is on a decentralized system.
Cryptocurrencies have very subjective views with different meanings to different people. Therefore, before investing, it is essential to understand all the cryptocurrencies’ concepts, opportunities, and risks.
The Main Characteristics of Cryptocurrencies
First, cryptocurrencies are digital or virtual assets. This implies that it’s not physical money that can be touched. Instead, it is in the form of intangible currency.
The foundation of this currency is the blockchain technology that records, tracks, and maintains transactions.
Several of these digital assets are decentralized. This means that the currency has no third-party influence or control of governments or central banks.
Cryptocurrencies are dynamic and speculative. This means that the values are also flexible and can be shifted at any time.
Bitcoin is still the most prominent cryptocurrency in the world. It is the first and most widely used digital asset with the highest market capitalization in the industry.
So when you mention cryptocurrencies, some people think of Bitcoin. This is because Bitcoin has become digital gold in the cryptocurrency world due to limited supply. But in addition to Bitcoin, there are other options of cryptocurrencies suitable for investing in S.A. However, with over 8,000 virtual assets currently available, it’s easy to get confused, especially beginners.
Therefore, the best approach to invest is to focus on the well-known cryptocurrencies by market capitalization. This reduces unnecessary risks associated with digital assets.
Cryptocurrency Investment Trends in South Africa
Every digital asset has a specific and unique purpose. Bitcoin, for example, is focused on addressing the banking industry around the world. As part of that, Ripple enables financial institutions to send and receive funds with a quick and inexpensive approach. Using smart contracts for digital assets is Ethereum’s primary goal. However, South Africans are investing to make some money, even if the purpose of cryptocurrencies is different. Therefore, a theoretical approach is more appropriate when buying cryptocurrencies.
If the primary purpose of buying cryptocurrencies in South Africa is monetary gain, the following flow outlines the procedure.
- Suppose you invest R3 000 in Bitcoin.
- The price at the time of purchase of Bitcoin is $ 30,000.
- A few years later, the price of Bitcoin rose to $ 60,000.
- This means that the investment has increased by 100%.
- You can cash out and get lands by selling cryptocurrencies on any exchange of your choice.
From the figure above, you can see that the R3 000 investment generated 100% profit. This is twice the amount invested. Therefore, if it is sold out, you will get R6 000, which is equivalent to the profit of R3 000.
Or you can see the South African crypto market as well as penny stocks. Not only are the prices of digital assets very volatile, but they are also very dynamic. Therefore, they change every second.
For example, at writing, Ethereum prices have fallen 3.52% in the last 24 hours. However, further price increases show a 12.02% decrease.
Therefore, you should invest in South African cryptocurrencies only if you can handle the industry’s volatility.
Is it legal to invest in cryptocurrencies in South Africa?
One of the main concerns of South African crypto investors is whether these purchases are legal and secure.
If you want to buy cryptocurrencies in South Africa, don’t worry. The whole process is legal. There is no existing law prohibiting South Africans from freely buying and selling digital assets. This is simply the reason why the digital industry has become so popular.
Cryptographic-specific legislation is a future issue introduced by the South African government. However, there is one area of cryptography covered by national law, which is taxation. As with any equity investment, you pay taxes on all profits you earn from holding cryptocurrencies.
Best Cryptocurrency Exchanges in S.A.
It is one of the best platforms for cryptocurrency trading in South Africa and provides the latest market and economic news. It has high security and privacy standards and faster order execution and charges a 0% fee commission. Trading is easy to start on this platform, even for beginners, with four simple steps. You can trade various types of cryptocurrency like Bitcoin, Gold, Ethereum, Natural Gas, Ripple, etc.
Crypto.com is the best cryptocurrency trading app with over 10 million customers worldwide. It is an all-in-one platform for buying, selling, trading, spending, storing, earning, lending cash, and even paying invoices in cryptocurrencies.
In addition, Crypto.com has very attractive deals for new and existing cryptocurrency investors like 90-day free trading for new users, for all existing users 50% save on transaction fees, Bonus Deposit Rate up to 2% for deposits done in the first 30 days, etc. Moreover, Crypto can be easily bought through credit cards with fee exemption for a limited time, and it is one of the best entry lamps for South African users to enter the market at a low rate.
Easy Crypto is a beginner trading platform that provides one of the best places to convert ZAR to Bitcoin. It allows you to quickly and securely convert one asset to another with fiat currency purchases and instant crypto swaps. You can buy or trade over 122 digital currencies such as Bitcoin, Ethereum, XRP, lesser-known Altcoin, and DeFi Token.
Purchased assets are sent directly to the wallet, significantly reducing the risk of hackers stealing coins held in wallets on traditional exchanges. One of the best features of Easy Crypto is the Dollar Cost Averaging (DCA) which allows you to build long-term investments in Bitcoin or other digital currencies.
Binance is among the most popular exchanges for cryptocurrency worldwide. This platform is easy to buy, sell and trade over 200 digital cryptocurrencies. As a result, Binance has skyrocketed to become the world’s most popular crypto exchange, with the highest daily trading volume.
Its fees range between 0% and 0.1% and are among the lowest rates compared to the other exchanges. It supports multiple payment methods such as credit/debit cards and bank transfers. It provides a secured Binance wallet for storing crypto assets and provides savings accounts to increase interest. The Binance P2P platform can convert ZAR to BTC easily, quickly, and safely without paying any additional fees. You can withdraw ZAR directly to your local bank account.
Kraken is a famous cryptocurrency exchange, primarily Bitcoin, founded in 2011. The platform is among the top exchanges based on liquidity, traffic, and spot trading volume and has over 70 crypto pairs for buying, trading, and selling, with new assets being added regularly. Users can also trade cryptocurrencies such as EUR / USD and Forex with Kraken.
Since its inception, it has grown into a leading exchange with a reputation for ease of use, secure, and competitive pricing. The platform is suitable for experienced crypto investors to quickly deposit and withdraw from statutory banknotes, visualize portfolio performance and track all digital assets in one place.
The process of registering an Exchange account with Kraken is straightforward. Within 5 minutes, you can open your account with your details. In addition, simple methods such as credit/debit cards are used to transfer funds and buy Bitcoins.
Kraken customer support helps users 24 hours a day, seven days a week through live chats.
Luno is a well-known cryptocurrency exchange with a platform specially designed for beginners. It offers secure wallets to clients and an easy way to buy, sell and hold Crypto. Available in multiple countries worldwide, including South Africa, Luno allows individuals to convert ZAR to digital assets such as XRP, Bitcoin Cash, Ethereum, and Litecoin in one place. It is the quickest way to start trading cryptocurrencies in various fiat currencies. Luno also offers a reliable and secure online wallet for individuals to temporarily store coins.
CEX.IO is one of the oldest exchanges globally for cryptocurrency buyers and sellers and is trusted by over 4 million users. It is a world-class exchange that appeals to all types of investors with an easy-to-use interface, ideal for beginners and experienced investors. In addition, it is a popular choice for residents who want to buy cryptocurrencies instantly using their credit/debit cards. The exchange is available on desktops or mobile apps that support iOS and Android smartphones. Users can also sell coins immediately and withdraw fiat money to VISA, Mastercard, or a bank account.
It is a Europe-based Bitcoin broker that provides low fees for various payment methods and high payment limits. It offers multiple ways to purchase Bitcoin like through debit card, SOFORT, credit card, giropay, SEPA, Skrill, NETELLER, eps, and online bank transfer. This platform is easy to use, trusted, secure and fast and offers the lowest price for purchasing Bitcoins.
Although this platform does not show fees directly on the site but includes them in the purchasing price.
If you wish to buy cryptocurrency, it is also better to stick to an established and reliable exchange that accepts USD or ZAR deposits. The crypto platforms listed above have proven secure and are used by millions of customers worldwide to buy, trade, and sell cryptocurrencies. If you plan to buy and trade cryptocurrencies, transfer and store your coins in a trusted Bitcoin wallet. It’s the best way to protect your crypto investment.