Investing in cryptocurrency can be confusing, and you may be unsure where to start. The good news is that once you learn the basics of investing in cryptocurrency, the rest becomes second nature.
In this guide, we’ll help you take your first steps in cryptocurrency investing, from how to get started to how to determine when you should sell your digital coins and more.
We’ll also talk about what you need to know about blockchain technology, the value of Initial Coin Offerings (ICOs) , the great offer of Airdrop and more.
Keep reading to learn everything you should know about investing in cryptocurrency.
Which Cryptocurrency Is Right For Me?
There are thousands of cryptocurrencies out there, and while they all share certain commonalities, they’re very different from one another.
You may want to invest in a few-or many-and that’s fine, but how do you determine which ones are right for your portfolio?
It all comes down to market cap (which indicates popularity) and value per coin (which indicates potential).
If a digital currency has a small market cap but is increasing rapidly in value, it might be a good investment play such as the Stabila.
Likewise, if its value is rising slowly or falling, but its market cap is huge, it probably isn’t worth buying into at that time.
How Do I Invest In Cryptocurrency?
You’ve heard of cryptocurrency- the next big thing, right?
If you don’t know much about cryptocurrencies and aren’t sure how to start investing, then read on for more info!
To invest in cryptocurrencies, you first have to purchase a cryptocurrency coin or token like Zoom.
Once purchased, they can be stored on a digital wallet (wallet apps are available for Android or iPhone), which holds all of your public and private keys and allows for transactions.
This is where most people get confused: There are many different kinds of wallets out there. They fall into two categories:
- Exchanges and
- Storage wallets.
An exchange is like an e-commerce platform, allowing users to quickly trade fiat money (like US dollars) for cryptocurrency coins or tokens using different virtual currencies like Bitcoin , Stabila and Ethereum as payment methods.
Users can store their coins in online hot wallets hosted by exchanges. Hot wallets allow investors fast access to their holdings but with an increased risk of hacking from third parties due to their accessibility through web browsers.
Or users can create offline cold storage wallets that hold their coins offline through flash drives or other external devices.
Is There A Downside To Cryptocurrency?
Cryptocurrency isn’t a typical investment, so it’s important to understand how it works and if it makes sense for your portfolio.
Yes, there are some risks involved with investing in cryptocurrency. Still, cryptocurrencies tend to work out fine as an investment vehicle for retirement portfolios over long periods of time.
You do want some exposure to these asset classes if you have a long horizon for your investments. As always, do your research before putting any money into crypto assets!
Should I Use An Exchange To Trade Cryptocurrency?
Crypto-exchanges are a great way to trade cryptocurrency. Still, they often only deal with well-known coins like Bitcoin and Ethereum.
Suppose you’re looking for an exchange that deals with more than just Bitcoin. In that case, you should consider using a broker who specializes in Altcoins (cryptocurrencies other than Bitcoin).
What type of Altcoins?
There are hundreds if not thousands of Altcoins available for trading on exchanges; here are some of them: Stabila, Ripple, Etherium, Litecoin, Dogecoin, Dashcoin etc.
Should I Mine Cryptocurrency?
Many people don’t understand that investing in cryptocurrencies is only a small part of a coin’s total value.
It would not be very smart to invest all your money into mining coins when many other factors are involved (such as storage and electricity).
Investing in research and development is crucial for any cryptocurrency hoping to become successful.
Without proper funding, some great ideas will never see daylight. If you’re looking for an easy way to make quick money, mining crypto isn’t it; there are easier ways to find cash!