Going into 2020, Tezos is one of the best performing altcoins on the market, surging in value by more than 50% in just five weeks. It’s time to find out more about this exciting altcoin and judge for yourself whether it’s a worth a punt.
Where to buy Tezos
Read on to find out more about Tezos in 2020 or skip ahead to our step-by-step buyers guide if you’re up to speed and ready to invest in Tezos (XTZ).
What is Tezos?
Tezos’ status as the first self-evolving blockchain is its big USP. This partly explains the excitement that surrounded its development in 2014 and the $230 million (plus hedge fund investment) it raised after its IPO in 2017. Another big factor was the involvement of billionaire venture investor Tim Draper, who’s backing further stoked the hype that greeted its high-profile launch.
Since then, Tezos has been dogged by delays and mounting investor anxiety, but confidence in the altcoin’s underlying promise – notably from Weiss Crypto Ratings – certainly won’t hurt its prospects.
How does Tezos work?
Tezos is touted as a ‘new decentralised blockchain that governs itself by establishing a true digital commonwealth’. This notion of a commonwealth is central to the Tezos offering. In this case, the commonwealth is composed of Tezos token holders who receive rewards for participating in a proof-of-stake system.
Tezos’ headline innovation is that its ‘commonwealth’ of users are genuine stakeholders in the development and governance of the currency. This democratised approach to the maintenance and evolution of Tezos allows token holders to vote on pending protocol decisions.
How to buy Tezos online – step-by-step guide
Step 1. Get a suitable wallet
A wallet allows you to store your Tezos securely. It’s a good idea to have one ready before you invest – it’s a far safer way to store cryptocurrency than leaving it on the exchange. There are plenty of good options on the market, including:
- Ledger Nano X: Ledger Nano X is a hardware wallet, which means you can store your XTZ (along with 30 other cryptocurrencies) offline on a super-secure wireless device.
- TezBox: One of the first dedicated Tezos GUI (Graphical User Interface) wallets to hit the market, TezBox offers an appealing interface and great security, because it doesn’t store any of your private key information internally. This desktop and online wallet supports both Windows and MacOSX.
- TREZOR Wallet: Hardware wallets such as the TREZOR wallet offer maximum security, but at a price that may put some beginners and casual traders off.
Step 2. Find a Tezos exchange
There are plenty of exchanges on offer if you want to buy and sell Tezos. Each has advantages and disadvantages, so it’s a good idea to do a bit of research. To get you started, here are two of our favourite Tezos exchanges:
- Binance: Widely considered to be the best, most dependable place to buy Tezos, Binance is the world’s biggest crypto exchange. It offers a huge crypto marketplace and fees that compare favourably with its main competitors, plus a well-designed mobile app.
- Bitpanda: If you can’t find what you’re looking for at Binance, the next best place to buy Tezos is BitPanda. If you’re on mobile, you can download the Bitpanda app and buy XTZ on the go.
Step 3. Withdraw your Tezos
In the interests of securing your tokens, it’s a good idea to move your currency out of the exchange and into your wallet as soon as possible. To withdraw your XTZ to your wallet you need to generate an address then paste it in the relevant field of your exchange account.
How to trade Tezos – step-by-step guide
If you’re only interested in trading Tezos you needn’t worry about getting a suitable wallet because trading involves taking a position on a currency rather than acquiring it. This means you can potentially make a profit from XTZ without the hassle and security risk of owning it.
Step 1. Find a broker
Tezos is pretty new to the market so not all brokers offer it yet. This looks like changing pretty fast given its recent market performance, so you shouldn’t have to look for too long. Plus500 and eToro are two of the most popular crypto trading platforms.
Step 2. Deposit money
Most trading platforms will allow you to deposit Fiat money (USD, GBP, EUR etc.). It’s worth noting that trading platforms offer leveraged trading, which means you don’t have to put down the full value of a trade. Instead you can pay a deposit, known as a ‘margin’. This means you can potentially make bigger profits and, of course, bigger losses.
Step 3. Decide how you’d like to trade
There are two methods to trade cryptocurrencies: CFDs (contracts for difference) and Spread Betting. Both methods essentially entail speculating on the price movements of your chosen currency. If you aren’t sure which option to go for, we recommend researching the differences between spreads and CFDs.
Step 4. Start trading
If you’re a complete novice we recommend starting with a demo account and familiarising yourself with the process and the platform. Cryptocurrency trading is extremely volatile, which means you can make and lose money very quickly. Tezos is prone to fluctuation, which makes it an intriguing prospect for traders who look to exploit volatility.
As a crypto trader you’re speculating on your currency’s price movements by taking a short (sell) or long (buy) position. If you think Tezos will fall in value you should take a short position, if you think it will rise in value you should take a long position.
You may choose to incorporate leverage into your trading strategy. Leveraged trading allows you to put up a fraction of the trade’s value as a deposit or ‘margin’. This can be risky, though, so make sure you have a stop loss in place for damage limitation.
- Self-evolving technology is truly innovative and sets Tezos apart from the crowd
- Explosive market performance going into 2020
- Michelson, its native smart contracts language, facilitates formal verification, reducing bugs and vulnerabilities
- Delayed rollout caused investors to panic and threatened to damage the coin’s reputation
- Recent surge may be largely attributable to a bear market, so short term investors may be disappointed