Do you want to invest in cryptocurrencies? Investing in cryptocurrency can be quite intimidating if you’re only just learning about its existence now. In fact, taking the plunge and entering the cryptocurrency sphere is a volatile experience for anyone, with or without investment background. This is because the crypto space has no centralized authority to guide investors. Rumors, hype and horror stories dominate the internet, therefore separating fact from hearsay can be difficult at times.
If you invest without thinking – you simply risk losing your investment.
Let’s look at some important points requiring your attention before exchanging your money for cryptocurrency.
Invest only that money that you can lose
As the cryptocurrency market is not stable, getting a return on investment can be longer than expected.
Thus invest only the money that you do not mind losing. It must be the amount you don’t need in your day-to-day life. If you ever lose that, it should not affect your life. Never deposit the last 500 euros that would remain in your bank account.
Search for the information
Before you start buying crypto coins – do your own research. For example, begin with Coinmarketcap. This website gives a glimpse of total overview of the current market and has hyperlinks to every coin out there. Also, do some research into the technology of blockchain networks. A good place to go to is Blockchain.com. This site gives a deeper insight into this network and has interesting infographics about current transactions and network statistics.
Don’t blindly trust people without due diligence
Never invest on the advice of people you do not know (having read a message on a forum for example). Educate yourself about crypto prior to investing your money. To make an analogy with other more traditional investments, here are some examples:
- Would you be willing to buy an apartment or house without visiting it?
- Would you buy a used car without the papers?
- Would you take an annual gym membership without looking at what it looks like and what services it offers?
Diversify your investments
If you have money to invest, make a diversification – invest in different coins.
You must know the saying that you should not put all your eggs in one basket. In case your basket falls to the ground, you break all your eggs and you lose everything. If you had 10 eggs divided evenly into 5 baskets, then you would have lost only 2 eggs.
Keep your crypto safe
Nowadays there are a lot of cryptocurrency wallets – a software program designed to store your public and private keys, send and receive digital currencies, monitor their balance, and interact with various blockchains. What you need is simply having cryptocurrency wallet to manage your crypto assets and keeping it secure.