5 Ways To Invest In IOTA In 2021
IOTA is a first-of-its-kind cryptocurrency that went beyond the concept of blockchain, basing itself purely on a distributed ledger system, to record and execute transactions between devices/machines in Internet of Things (IoT) ecosystem. Its native coin mIOTA accounts for the IOTA transactions, and was valued at around $2 per coin, with a market cap of $5.7 billion at the time of writing this piece.
IOTA uses a proprietary technology called ‘Tangle’, through which it uses a system of nodes to confirm transactions. What sets it apart is its greater speed compared to the conventional blockchain. In this detailed guide, we will discuss how to invest in IOTA through multiple mediums.
1. Trade IOTA
One of the key ways to invest in IOTA is by trading the cryptocurrency on a reputed broker platform. When you choose to do this, you’ll be able to use derivative products like Contracts for Difference (CFDs), futures, options and more, to speculate on mIOTA’s market price movements.
Using these investment vehicles is different from conventional investing because you get to use the power of leverage, and are able to take big market positions, without the need of investing the complete value of the trades. On the flip side, you won’t actually own any mIOTA coins, but simply bet on their price movements to register profits or losses. As a result, there will be no need of storing the cryptocurrency in a crypto wallet either.
This type of investment approach is ideal for people interested in short-term trades, to create a secondary income for themselves. Considering the volatility of cryptocurrency markets, you also need to have a good risk appetite for such investments.
Where to trade IOTA
To trade mIOTA on an online broker platform, you will need to carry out some due diligence to ensure that you transact only on a reputed and reliable broker. The best way to shortlist brokers is by looking at important parameters such as their regulatory status, customer service, commissions, withdrawal fees, payment options, security measures, user-friendliness etc.
Considering the large number of brokers operating in the crypto market today, studying all these parameters can be a very time-consuming affair. We’ve done all the hard work and have listed some of the most recommended cryptocurrency brokerage platforms on the Internet today, based on all the important factors discussed above. You can go through them below.
2. Buy and HODL
Another popular approach of investing in IOTA is ‘Buy and HODL’. The HODL here stands for ‘Hold on for Dear Life’, and implies the strategy of holding onto one’s crypto coins regardless of how volatile the market conditions may get. The idea is to benefit from the appreciation of the coin’s value over a considerably long investment period.
As can be inferred, it’s a long-term approach wherein you buy IOTA from a preferred platform, and then keep it safe, preferably in a cold hardware wallet. For this purpose, you can buy mIOTA either through a reputed cryptocurrency exchange or via a brokerage website that allows for actual sale/purchase of cryptocurrencies. Please note, unlike the investment approach discussed in the first point, wherein you trade mIOTA through derivative products, without actually owning it, the ‘Buy and HODL’ investment strategy involves actual purchase and storage of the mIOTA coins.
Please note, as ‘Buy and HODL’ investment strategy involves buying mIOTA coins, we have done comprehensive research on various places where you can buy the cryptocurrency in a safe and hassle-free manner. To make things easier, we offer dedicated and detailed pages on this website where you can gather all pertinent information related to different ways of buying IOTA on the internet. Please note, while it’s possible to purchase IOTA using different payment options, the ones available to you will depend entirely on where you reside, and may come with their own specific transaction fees. You can find below the relevant links in this regard:
- Buy IOTA
- Buy IOTA with PayPal
- Buy IOTA with Credit Card
- Buy IOTA with Debit Card
3. Invest in Cryptocurrency and Blockchain Companies
If directly investing or trading in IOTA seems intimidating to you, especially considering the number of factors you may need to constantly keep track of (to profit from the activity), you can use an alternate investment approach. This alternate strategy is about investing in a company which is heavily invested in IOTA, because of the currency’s strong fundamentals, or actively uses the IOTA/Tangle technology for its operations. By investing in the stock of such an organisation, you will profit from the success of IOTA as well as that company. Please note, to be able to buy/sell stocks of any such company, you will need to deal with a brokerage platform.
Where to invest in IOTA shares
When it comes to investing in the shares of an IOTA or Tangle based company, you can either invest in the actual shares and then hold on to them for future sale, or can use derivative products like CFDs, futures and options to bet on the price movements of their market value.
If you choose to use the latter approach, you’d be able to open long or short positions for that particular stock, on the broker’s website, depending upon which way you expect the price to move. The broker may offer you a leverage facility, enabling you to take big positions, without having to pledge the complete trade value. It’s a strategy that is quite like trading in a cryptocurrency, except for the fact that you’re speculating on the price movements of an IOTA-based stock.
Considering the important role that a broker plays in this entire activity, it’s very important that you select your brokerage platform after thorough research. Some of the key factors you’d need to look at while shortlisting these service providers include regulatory compliance, operational costs, payment options, security measures, value-added services, customer support, user-friendliness, spreads and more.
With so much at stake, almost every broker platform may seem like doing everything possible to get your business. Therefore, it can get very difficult to compare multiple broker services on various parameters, especially if you’re just starting out. We have done all the due diligence and have recommended a broker service below.
4. Become a Miner/Staker
Mining or staking are two commonly known methods of acquiring a cryptocurrency. While mining involves verifying the blockchain transactions of a cryptocurrency, by committing dedicated computing power, staking is essentially about having enough crypto coins to be able to stake your claim on the right to carry out transaction validations.
It’s important to note that IOTA involves neither mining, nor staking and hence this method of acquiring a cryptocurrency doesn’t hold any relevance in its case. The Tangle technology used by IOTA gives it two distinct advantages over the conventional blockchain tech: It does away with the need of miners and facilitates almost infinite scaling. For every IOTA transaction to get validated, it must process two other transactions, and the ‘Proof of Work’ required for them is so low that almost any device can do the job. Therefore, no dedicated miners are needed to maintain the network’s integrity.
Where to store IOTA
No matter how you invest in IOTA, it is inevitable that you’d require some safe place to store your coins. A couple of the most popular ways of storing crypto coins are in a software wallet or a hardware wallet. As is evident, a hardware wallet is a physical device, resembling a flash drive, which can be completely disconnected from the Internet, to ensure maximum security. A software wallet on the other hand can be an online service, a mobile app or a desktop application that stays connected to the internet. Your choice of wallet will depend entirely on your IOTA investment strategy and how readily you’d like your mIOTA coins available for transactions.
5. Become an IOTA Developer to Make Money
If you’re not too keen on the usual ways of investing in IOTA, but would still like to be associated with the project and acquire mIOTA in some way, you could become an IOTA/Tangle developer and create software programs or apps that use IOTA transactions for their functioning. This way you could potentially get paid in mIOTA, as a transaction cost, or in some other way.
To start building innovative solutions using IOTA, you will need to first master the basics of IOTA as well as Tangle, the system which forms its foundation.
It would be better that you get yourself a programming education to succeed in this field. A software engineering degree is preferable, as it will give you a good insight into multiple programming languages like Java, C++, PHP, Python and others. Learning various languages will give you a good foundation and allow you to code any way needed, depending upon what kind of product you plan to develop.
Expert Tip on When and How to Invest in IOTA“ To summarise, we touched upon multiple ways of investing in IOTA, starting with trading the cryptocurrency on a broker platform, buying and holding onto it, investing in an IOTA-based stock and lastly becoming an IOTA developer to earn some mIOTA. Before you use your hard-earned money to invest in IOTA, or for that matter any other cryptocurrency, you should look at multiple factors like the coin’s history, price movements and future developments. Having said that, it’s important to highlight that there’s no right or wrong time of investing in IOTA. New investors must practise risk management and gain some experience to become successful at investing in IOTA. ”- Ashish Sood