For beginners taking their first plunge into the crypto world, it may seem a bit confusing as there is a lot one needs to know before investing in any one particular type of coin. However, with a little guidance, one can start to learn the ropes, and soon be well versed in this type of investing.
Like any investment, one should never invest in anything without first knowing what they are investing in. The fear of missing out sometimes will push you to make snap decisions, and in the world of investing this can lead to losses. Understanding the space is the key to investing in cryptocurrency, and if you don’t know the space, then you need to take some time and study blockchain technology to get a good understanding of the platform and how it works before you get started.
Take your time with this research, there are also a few quality research centers that can train you quickly on how to invest in the space. Don’t think that this needs to be something done in a few days, or worse, a few hours. Take the proper time and become skilled in the field before making decisions about where to invest your assets. Then it’s time to get into an investment group, open an account on an exchange, and venture into the world of cryptocurrency.
To get started you might want to open an account with a cryptocurrency investing and research center, then an exchange such as Kraken or Coinbase, which allowing one to exchange fiat currency into cryptocurrency. Deposit money, and now you’re ready to invest. There is no need to start big. We would recommend you start off small and don’t think that you are going to strike it rich right off the bat. Can you get lucky? Sure, anyone can get lucky, but getting lucky is not an investment strategy, and you should never count on it happening.
All first time investors should start small and learn the ropes in order to keep yourself as safe as possible. You will notice right off that the crypto marked has some pretty extreme volatility, and there are a lot of cryptocurrencies out there to invest in. So which one? Probably better to start off with the big two, which is Bitcoin or Ethereum, as they are the most trusted and safest among all the various types of cryptocurrency.
You might want to put half your money into Bitcoin, and the other half into Ethereum. In the meantime, start researching the various other coins out there and get to know them well enough so that when you are ready and have some confidence about your understanding of this market, you can start spreading out your investments into some of these other cryptocurrencies. Spotting smaller alternative coins (altcoins) is where the real profits can be had if the right investment is made.
This should only be done, however, once you know everything there is to know about those coins, their exchange, and their history. Find out why those particular cryptocurrencies exist, find out about the teams behind them, find out what problems they solve, read their white paper, and then make an educated decision about whether to put your money into those coins or not makes sense to you.
Just like if you were going to invest in stocks, you would want to research the companies behind those stocks and find out such things like who’s on their teams, who’s on their boards, what their business plans are, what were their earnings from last year, etc. All these numbers, names, and histories one would want to know before sinking any serious cash into a stock. The same should be true for any assets put into cryptocurrency as well.
One should also join any reputable social media platforms that can put you in touch with the people in the cryptocurrency, and find specific pages/chats for the exchanges you are the most interested in. Sign up for their emails, take in their Twitter feeds, find them on Facebook, and actively talk to their people about those coins before investing in them.
Once you have your feet in the water, take a good look at your investments at least once a month, and make adjustments based on trends that have become apparent over that quarter. Maybe you will need to pull from one and allocate to another if you believe the trends will continue.
The best thing you can do, in any investment, is to take baby steps at first so that if you make a mistake, it won’t cost you an arm and a leg. Learn all the lessons taught in the school of hard knocks with your smaller investments, so that by the time you put substantial assets invested in cryptocurrency you will know enough about it to avoid the pitfalls and start to make some real money in the crypto game.