How to Invest in Cryptocurrency Using the Groww App

Imagine being able to invest in Bitcoin, Ethereum, or even emerging altcoins right from your smartphone. Well, that’s possible today with investment platforms like Groww, a fast-growing app that makes it incredibly simple for beginners to enter the world of cryptocurrency. But how do you get started? And more importantly, how can you maximize your returns without getting overwhelmed by market volatility? Here's a comprehensive guide on how to invest in cryptocurrency using the Groww app, broken down step by step to help you make smarter financial decisions.

What is Groww?

Before diving into cryptocurrency investments, let’s take a quick look at what Groww actually is. Groww started as a platform for investing in mutual funds but has since expanded into offering stocks, fixed deposits, and now, cryptocurrencies. The app is widely praised for its user-friendly interface, which makes it accessible even to those who are new to the financial world. If you’ve been hesitant to explore cryptocurrency because of complicated setups, Groww might be the perfect entry point for you.

Why Invest in Cryptocurrency?

The appeal of cryptocurrency lies in its decentralized nature. Unlike traditional currencies that are governed by central banks, cryptocurrencies like Bitcoin are not controlled by any single entity. This makes them appealing to a wide range of investors. Cryptocurrencies are also known for their potential to provide high returns over time, although the risks are equally high. The potential for quick profits is often what drives many first-time investors to dip their toes into the crypto world. But it's essential to approach this with caution and a clear understanding of the market.

How to Set Up a Groww Account for Cryptocurrency Investment

If you already have a Groww account for mutual funds or stocks, congratulations! You’re already halfway there. If not, here’s how to get started:

1. Download the App: Go to the Google Play Store or Apple App Store and download the Groww app.
2. Create an Account: Sign up using your mobile number, email ID, and PAN details. You’ll need to complete a simple KYC (Know Your Customer) process to verify your identity.
3. Link Your Bank Account: You’ll need to link your primary bank account for fund transfers. This is where all your profits will be credited, and from where you’ll be making your investments.
4. Enable Cryptocurrency Investing: Not all Groww users automatically have access to cryptocurrencies. You may need to check if the feature is enabled in your account or request access through the app’s support feature.

Navigating the Cryptocurrency Section

Once you’re all set up, follow these steps to navigate the cryptocurrency section in the Groww app:

1. Find the Crypto Tab: Open the app, and on the home screen, you’ll find the "Cryptocurrency" section. Tap on it to enter the crypto world.
2. Browse Available Cryptocurrencies: Groww offers a range of popular cryptocurrencies, including Bitcoin, Ethereum, Ripple, and Litecoin. You can click on each to view details like historical performance, market cap, and trends.
3. Choose Your Investment: Once you’ve done your research, select a cryptocurrency to invest in. Groww allows you to invest with as little as ₹100, making it accessible to beginners.
4. Make a Purchase: After selecting your cryptocurrency, choose the amount you wish to invest. You can either buy a whole unit or a fraction of a coin, depending on your budget.

Types of Orders on Groww: Instant vs Limit Orders

One of the key features Groww offers when investing in cryptocurrencies is the ability to choose between instant and limit orders.

• Instant Orders: These are executed immediately at the current market price. If you want to buy or sell your cryptocurrency quickly, this is the option for you.
• Limit Orders: With a limit order, you set the price at which you want to buy or sell. The order is only executed when the cryptocurrency reaches that price. This is ideal if you’re trying to time the market for a better deal.

Security Measures: Keeping Your Investment Safe

Cryptocurrency investments come with inherent risks, particularly concerning security. Groww takes this seriously and employs several measures to ensure the safety of your investments:

1. Two-Factor Authentication (2FA): Always enable 2FA for an additional layer of security.
2. Encryption: All transactions and account details are encrypted, protecting you from hacks and breaches.
3. Withdrawal Limits: Groww also allows you to set withdrawal limits, which can protect your funds from unauthorized access.

Diversifying Your Portfolio

Cryptocurrencies are highly volatile, and even though they can offer high returns, they can also lead to significant losses if the market takes a downturn. One way to mitigate this risk is to diversify your portfolio. In the Groww app, you can not only invest in a variety of cryptocurrencies but also other asset classes like mutual funds and stocks. By diversifying your investments, you’re spreading out your risk across different sectors, reducing the chances of a total loss.

Tracking Your Investments

Groww makes it easy to track your cryptocurrency investments. Once you’ve made your purchase, you can view your portfolio in real-time through the app’s dashboard. Here are a few features that can help you keep an eye on your investments:

• Performance Charts: These allow you to see the historical performance of your chosen cryptocurrencies. You can track day-to-day changes, or zoom out to see monthly or yearly trends.
• Alerts and Notifications: Set up alerts for price changes, so you’ll be notified when your cryptocurrency hits a particular value. This is especially useful for those using limit orders.
• In-App Analysis Tools: Groww also offers basic analysis tools that can help you understand market trends and make informed decisions.

When to Sell?

Knowing when to sell is just as important as knowing when to buy. Cryptocurrency markets can be highly volatile, and prices can skyrocket or plummet within minutes. Groww provides a few tools to help you make this decision:

1. Real-Time Data: The app offers real-time data on the value of your cryptocurrency, helping you to stay up-to-date with market trends.
2. Profit/Loss Calculations: You can view your profit or loss in real-time, allowing you to decide if it’s the right time to sell.
3. Expert Insights: The app also features market news and expert opinions that can give you an edge in decision-making.

Tax Implications

In India, cryptocurrency is still a relatively new form of investment, and the tax rules are evolving. As of now, any profits made from cryptocurrency investments are considered capital gains and are taxed accordingly. Groww helps by providing tax reports, which you can download directly from the app.

Advantages and Risks

Let’s sum up the advantages and risks of investing in cryptocurrency via Groww:

Advantages:

• User-Friendly Interface: The app is designed for beginners, making the process straightforward.
• Low Investment Threshold: You can start with as little as ₹100.
• Diversification Opportunities: Groww allows you to invest in multiple cryptocurrencies and other asset classes.

Risks:

• Market Volatility: Cryptocurrency markets are unpredictable, and prices can fluctuate rapidly.
• Security Concerns: Despite Groww’s security measures, there’s always a risk of cyber attacks.

Final Thoughts

Investing in cryptocurrency through Groww offers a convenient way for beginners to enter the market. Its user-friendly interface, low investment threshold, and security measures make it an attractive option. However, as with any investment, it’s crucial to do thorough research and understand the risks involved. Cryptocurrency can offer significant returns, but it’s not without its challenges, particularly for those new to the market.

By following this guide and using the Groww app wisely, you’ll be in a better position to make informed investment decisions and potentially see strong returns on your cryptocurrency investments.