It should be noted that there are centralized and decentralized exchanges, and as in the case of wallets, the former has a central body that controls it. Simultaneously, the latter is distributed to nodes that uphold a central smart contract, which underpins all exchange operations and has been agreed upon by all stakeholders.

Explaining Exchange:

Usually, you will buy or instead exchange your fiat on a crypto exchange.

There are several different exchanges — they are the marketplaces where trading currencies happen almost like a stock exchange or changing your Euros into another currency on the forex exchange.

Types Of Crypto

There are so many types of cryptocurrencies available. If you are part of any crypto communities on Telegram or follow crypto enthusiasts on Twitter, then knowing what they are generally referring to is very helpful.

For example, Altcoin can’t, and won’t be found on any exchange. It is a collective name for all coins that are not Bitcoin.

Tokens represent a unit or portion of a cryptocurrency and may be considered securities in some jurisdictions depending on the token holder’s specific rights.

When a new cryptocurrency is introduced, parties who are funding the new currency are given tokens representing their participation or investment.

Don’t be confused between security tokens and utility tokens. They are different.

Utility tokens are designed to enable certain functions on a project or blockchain platform, referred to as “gas.”. Utility tokens are not necessarily backed by any assets and afford you no rights to dividends, shares of a company, or other ownership.

Security tokens, however, are a store of value that are often traded and meeting the “Howie Test” and can appreciate (or depreciate), giving the owner asset appreciation and returns from investment.

Specifically, the Howey Test concludes that a transaction symbolizes an investment contract if “a person spends his money in a standard enterprise and assumes profits entirely from the efforts of the promoter or a third party

Stablecoins are cryptocurrencies that are linked to the price of another asset like USD, Euro, GBP or group of assets.

This lowers volatility in the market, and usually, the assets related to the stablecoins are established and quite resistant to price fluctuations. Tether, Goldcoin, PAX, and Binance USD are some of the most frequently used stable coins.

Spend Your Crypto

Once you have stepped onto the crypto pitch with your Defi wallet app accessible or with your crypto debit card in hand, there are many activities you can undertake, and it is worth exploring the different investment avenues, opportunities, and crypto mining strategies in play.

Suppose you have opted for a wallet within an expansive ecosystem like the Eidoo wallet mentioned earlier. In that case, you may have to look no further for an exchange and access to other decentralized finance (Defi) solutions like lending and borrowing.

Track Your Crypto

At this point, it is worthwhile investigating Blockchain explorers – a blockchain explorer is like the Google of the crypto world.

Blockchain explorers like Ethers can access the details related to your transactions on specific wallet addresses and blockchains. The details include the amount transacted, where the funds came from or went to, and their ongoing status.

Explorers make crypto more transparent and are very helpful as you can track payments and you investigate different investments and actions that have taken place on the chain.

It is essential to do your research and reach out to the crypto community who can guide you through these processes. Happy spending and hopefully earning too.