5 Easy Tips for Beginners to Learn How to Invest in Cryptocurrency

Investing in Bitcoin and other cryptocurrencies is a great way to diversify your investments, but it’s also associated with risks. Therefore, before you start, it’s important to understand the basic concepts and principles. Crypto investing is more than just buying cryptocurrency and expecting the best scenario.

A sound investment decision requires thorough research and analysis. Ideally, you should have a strategy based on your risk profile and should never invest more than you can afford to lose.

Basic Things to Know About Crypto Investment

When investing in cryptocurrency, it’s important to understand a few basic things. Let’s consider them!

It’s a risky asset. Nobody guarantees you profitability. You can earn a lot, and lose everything. Therefore, you shouldn’t invest all your savings in cryptocurrency.

It’s a digital asset. Losing a private key to your cryptocurrency wallet means losing funds. The key can be stolen by hackers, or you can simply lose it yourself. Therefore, it’s worth paying attention to security issues — for example, withdrawing money to safe cold storage wallets.

All cryptocurrency operations are irreversible. If you sent money, you will no longer be able to return it. At the bank, you can make a request to the support service and cancel the operation, but this cannot be done in cryptocurrency networks.

Key Advantages of Cryptocurrency

Cryptocurrency is a bit risky but promising way to invest money. You can get high profits due to a significant increase in the value of assets. Bill Gates, the co-founder of Microsoft and investor, once said:

Bitcoin is exciting because it shows how cheap it can be. Bitcoin is better than currency in that you don’t have to be physically in the same place and, of course, for large transactions, currency can get pretty inconvenient.

Let’s finish his thought and consider the key advantages of cryptocurrency investments!

  • For a long time now, Bitcoin has shown stable growth in relation to other currencies. The chart shows the exchange rate of BTC against the US dollar.

BTC Price Chart (BTC/USD)

  • Bitcoin has a stable growth rate. After any downs, Bitcoin saw an upward trend. In addition, it has a large market cap, which further strengthens its position.
  • Bitcoin’s liquidity is higher than that of other cryptocurrencies. The possibilities of using it in buying and selling are also extensive.

It’s necessary to invest in cryptocurrency right now since at the moment Bitcoin and other digital coins are freed from government pressure. There is no additional charge for storing coins, as is the case with deposits or bank accounts. Advantages of most cryptocurrencies: anonymity, decentralization.

If you’re interested in buying Bitcoin or other cryptos, you should definitely think about doing this at Switchere. On our platform, you have an opportunity to buy and sell cryptocurrencies in the fastest and most convenient way. Moreover, we offer some surprising bonuses! Users of our platform enjoy a 0% service fee for the first order. 

5 Tips and Tricks You Should Know

If you’re planning to invest in crypto for the first time, it’s crucial to be aware of the basic things and issues. Below are the top 5 tips you should keep in mind before engaging in crypto investing.

#1 Invest in Asset with Real Value

Just ask yourself ‘What is behind this asset?’. Bitcoins and altcoins have their own practical value and are used for specific purposes. If there is a specific purpose behind the currency, it will be used and thus, its value will grow.

#2 Assess a Project Team

Who are the people behind the currency? Successful entrepreneurs, programmers? If they are figures with a good reputation and vast knowledge, you’re joining a successful team. It isn’t worth investing in a project created by amateurs. In this case, the chance of successful investment will be no more than 5%. 

#3 Conduct a Basic Market Analysis

Even giants of the cryptocurrency world face ups and downs. Once you’ve chosen an asset, don’t enter the market right away. Basic technical stock analysis skills are essential for any investor. 

#4 Diversify Your Portfolio

Diversification isn’t just spreading money among stocks, crypto assets, currencies, metals, or indices. There should also be diversification within each category. It’s optimal to choose 3-5 cryptocurrencies on which you plan to earn.

#5 Take It Slow

Don’t hurry to invest in assets after hearing from a friend that particular crypto has set a new growth record. You should wait for some time to observe the market because after a high rise any crypto either go through correction or a strong fall. It’s more reasonable to wait for the moment of decline in your chosen currency and buy it at the lowest price.

Conclusion

It takes time to learn how to invest or trade cryptocurrencies. Improving your knowledge is a good way to reduce your overall investment risk, which in turn will lead to sounder decisions. Selling an asset under the influence of emotion is easy, but the likelihood that you will do so is much lower if you study investing and trading.

Leave a Reply

Your email address will not be published.