Are you considering investing in cryptocurrencies? You ought to keep in mind several criteria before placing your money. If you do this without proper assessment, then you simply risk losing your investment. Important Tips investing cryptocurrencies
The world of cryptocurrencies is very wide. It doesn’t end at Bitcoin or Blockchain. Therefore, you must train a minimum and apply common sense to grow your investments.
In this article, Weekly Express will guide you step by step to make your first investments.
Important Tips investing cryptocurrencies
1. Only invest money that you can afford to lose
You only need to invest money that you are willing to lose – this is the basic and very first step about investing in cryptocurrency as it demands you to be very patient. The price of Bitcoin and Cryptocurrency is supposed to be extremely volatile.
In case the market is not doing well, getting a return on investment can be longer than expected. You might have to cope the inevitable loss. If you ever need this money to survive, here’s what it can cause:
- You will take out your investment by having made a dry loss.
- Your confidence may be heavily affected in your everyday life.
- You will try to do irrational things and it will amplify your losses.
Hence, we are suggesting you to invest money that you can afford to lose.
2. Study the subject beforehand
This is an important tip. You must take a minimum training before contemplating on investing money in cryptocurrency. Even if your close friends, relatives, colleagues have advised you to deposit money, do you really want to invest in a subject that you are unaware of?
Here are some examples to things out:
- Will you buy an apartment or house without seeing it?
- Will you buy a used car without checking the authenticity of the papers?
- Will you take an annual gym membership without knowing its services?
If the answer to the aforementioned questions is NO, then you should educate yourself about cryptos before putting your money in it.
3. Diversify your investments
The third tip focuses on diversification. There is a saying that “you should not put all your eggs in one basket” because if the basket falls, you are likely to lose all the legs. This concept is also valid for crypto-currencies. Therefore, you are recommended to diversify your investments.
You should divide them as follows:
- Bit of them in real estate.
- Others on actions.
- Some part in crypto-currencies.
On the same line, the part related to your investment will also have to follow this theory. It will be necessary to spread your investment through different cryptocurrency. The aim is to lessen the risk.
4. Inter-exchange transfers
After following the first steps, you will be able to start buying your maiden cryptocurrency. For this, we suggest you to use the cryptocurrency platform.
This platform enables you to purchase well-known cryptocurrencies such as BTC or ETH. To buy other crypto-currencies that are not so popular but have a growth potential, you will have to transfer your Ethereum and Bitcoin to so-called exchanges.
The exchanges are platforms where you can trade your bitcoins against crypto-currencies. It is also known as altcoin.
5. Do Your Own Research
“Do Your Own Research” is the fifth and a very vital tip to remember before entering in the crypto world.
It implies that you have to do your own research before investing in a project. Moreover, you should never make an investment on the advice of people you do not know.
In order to enhance your knowledge in cryptocurrency, here are the different media that you can use:
- Reading the white paper
- Interacting with experts on Twitter
- Specific discussion forum
- Join Telegram, Discord or Skype
- Search for Online Reviews.
It is important to be well informed so that nobody can make a fool of you and you can have your own opinion about a cryptocurrency.