Cryptocurrencies are volatile and unpredictable, so it’s important to keep an eye on the news. Volatility can be a good thing, but it’s also something you need to manage.
It may seem difficult at first, but once you get the hang of it, cryptocurrency investing can become one of your favorite hobbies. Here are our top 8 tips for beginners:
1. Get a Wallet
The second step is to read this CoinSpot review and get yourself a wallet where you can store your cryptocurrencies. A wallet is like an account that stores your private keys (the code that allows access to your funds). Make sure that your wallet has been created by a trustworthy provider and that the security measures proposed by the provider meet your needs.
2. Understand What You’re Buying
The first step is understanding what you’re buying. This can be difficult because of all the terms thrown around in cryptocurrency circles — but it’s important that you understand what each one means and how it affects your investment decisions.
3. Don’t Seek a Return on Investment (ROI)
One of the biggest mistakes new investors make is trying to time the market and make money based on when they buy or sell their coins. Instead, focus on earning interest from your coins rather than trying to make a return on your investment (ROI).
If you want to invest in cryptocurrencies, it’s important to research the market. Learn about the different coins and their history. Look at their past performance and whether they’re becoming more popular or less popular over time.
5. Buy when cheap
When it comes to cryptocurrency investing, buying low and selling high is a solid strategy. If a coin has been on an upward trend for some time and its price has risen significantly, then you may want to consider buying at that stage of the game before its price rises even further. You could also wait until a coin has fallen below a certain price point before buying it again, which would be an ideal opportunity for investors looking for a bargain! Some coins have fallen as much as 80% from their peak value since launching in early 2018 alone!
6. Know Your Investment Options
Cryptocurrencies like Bitcoin and Ethereum are not regulated by any central authority. This means that there isn’t a central exchange where investors can buy and sell them. Instead, you must use an exchange like Coinbase or Binance to trade cryptocurrencies on an exchange platform for funds that match your payment method (like credit card or PayPal).
7. Research Cryptocurrencies Before Investing
Because cryptocurrency investing is so new, there are still many unknowns about each coin’s potential value and future price movements. By doing some research before diving in, you’ll have more information on which coins have potential and which ones may be overvalued or undervalued at this point in time.
8. Don’t Over-Invest
The most common mistake made when investing in cryptocurrencies is over-investing. That’s because you don’t want to miss out on a potential opportunity, which can lead to high losses if all your money is tied up in one coin or project. If you’ve got the extra cash and aren’t afraid of taking risks, then go ahead! But if you’re already invested in other coins and projects, it might be best to wait until the price recovers before adding more.