Five steps to start your token journey

Token Tak​​eaways ✍

✨ As the token space can be overwhelming, there are several recommended steps new adopters can take as they start their journey. 

It’s important to get your finances in check, understand the risks, and learn key concepts such as crypto exchange platforms.

✨ The token.com app and blog are useful educational resources for people looking to navigate this world.

The token universe is new and exciting but also complex and daunting. Since there’s much to learn when entering the space, tokens can feel overwhelming. Beyond learning the basics, there are several vital steps to take when preparing to commence your journey, like getting your finances in order and learning about crypto exchange platforms. We’ve compiled a list of the five top ones below. Think of it as your beginner’s guide to this groundbreaking new world.

#1 Get your finances in order and start slow ✅

Token technology aims to empower people to achieve financial freedom. However, as the space is still young and tokens are prone to price volatility, there is a risk when entering the space.

So, it’s vital to mitigate risk as much as possible when interacting with tokens. That means making sure your finances are in check in the real world before you think about tokens.

You should ensure you can cover all life expenses—such as rent or mortgage payments, groceries, taxes, and leisure activities—before you put money into tokens. It’s a good idea to have an emergency fund—experts recommend setting aside at least six months of living expenses. 

As the space is volatile and experimental with no guaranteed success, you should only invest amounts you can afford to lose. Just as importantly, do not borrow money to invest in tokens.  

Finally, remember to start slow. The token journey is long; tokenization will take decades to reach its potential. That means there’s no rush to get exposure to tokens today. Learn the basics, take it easy as you go, and you’ll be well-prepared for long-term success.

#2 Learn the key concepts 📚

There’s a lot to learn as you enter the token space. While the complex jargon can feel daunting, it’s important to understand basic concepts before diving in.

You should aim to understand the difference between investing and trading (and know that most traders lose money) as well as strategies like Dollar-Cost Averaging before you put any funds into tokens. 

Interest in tokens grew as the value of the space soared in 2021, but prices declined as the market crashed in 2022. It’s essential to understand token market cycles before putting money into the space (Source: CoinGecko)

Additionally, learning how token market cycles work is necessary, as the space tends to move in bull and bear cycles. Token experts understand that bear markets are usually the best time to buy, and bull markets are generally the best to sell. But this information is often lost on new adopters.

It’s also a good idea to learn the fundamentals of central token technologies such as Bitcoin, Ethereum, decentralised finance, and NFTs. These categories represent key strands of the token economy, so they should be a top focus point for new starters. Only when you understand tokens can you master token investing, especially as the space’s volatility tests mental strength and conviction.

CryptoPunk #8857, one of the most valuable pieces in the CryptoPunks NFT collection. NFTs are considered one of the key strands of the token economy today (Source: CryptoPunks)

token.com is designed to help new adopters learn the basics. Our Cards feature essential information related to individual tokens, while our Collections are curated according to the space’s key categories. We also go into depth on key concepts on the token blog.

#3 Use a crypto exchange, download a digital wallet, and make a transaction 💻

For most people, the easiest way to access cryptocurrency tokens is through a crypto exchange platform. Coinbase and Binance are two of the world’s most popular crypto exchanges, which provide access to hundreds of tokens. Many new adopters make a bank transfer to a centralised crypto exchange (also known as a CEX) to buy tokens when they enter the space.

For those looking to go deeper in the token journey, using a digital wallet is another way to explore. The most popular Web3 wallet today is MetaMask, a hot wallet that stays connected to the Internet. Using MetaMask requires downloading a browser extension or mobile application and storing a seed phrase. Once you have a MetaMask wallet and send funds from a centralised crypto exchange, you can explore Web3 applications on networks like Ethereum. It’s important to note that hot wallets are not a good way to store tokens and should only be loaded with small amounts of funds.

MetaMask is the world’s most popular Web3 wallet. Token explorers use it to connect to applications like Uniswap and OpenSea (Source: MetaMask)

If selecting the best crypto exchange or hot wallet feels too confusing, token.com is a simple alternative that offers many of the same benefits with an enhanced user experience. We integrate Binance and some of the best crypto coin exchange platforms so you can access all of the space’s leading tokens and choose the best crypto to invest in, always according to your interests and preferences. We also look after assets, meaning you don’t need to store a seed phrase.

#4 Securely store your tokens 🔒

Once you understand the role of crypto exchange platforms and other basic token concepts, you should prioritise security. That means understanding hot and cold wallets, the difference between custodial and non-custodial wallets, and the benefits of hardware wallets.

Every token adopter should choose the storage option that’s right for them. But staying secure is critical. For non-custodial wallet users, storing seed phrases safely is essential. Many token users with significant holdings also use hardware wallets such as Ledger to secure holdings offline.

token.com removes the complexity associated with using token wallets since you don’t need to store a seed phrase when you sign up. We also look after your assets to make your journey easier.

As people dive deeper into the token economy, they often distribute assets in multiple wallets. For anyone who’s been in the space for a while, we recommend using options like Ledger in addition to token.com.

#5 Download token.com and start exploring 🌌

Once you’ve ticked off the previous steps, you should be ready to explore the token universe and start collecting tokens. Downloading token.com is a great way to start. You just need to get the app and complete our step-by-step onboarding process to get involved. You can fund your wallet with PayPal, and we plan to add support for credit and debit cards in the future (Brazilian customers can also fund their wallets with PIX today).

The Explore tab is the place to discover the top tokens and our curated Collections.

Please note: Investing in cryptoassets is risky. Due to the volatile nature of the cryptocurrency market, investors run the risk of losing their funds when they make an investment. Returns from cryptoasset investing are not guaranteed, therefore users should always be aware of the risks.