How to start investing in cryptocurrency
Have you seen all the hype about investing in crypto but have no idea how to do it? Do you want to learn more about investing in crypto and how you can get started with it?
Crypto is very quickly taking over the world and these days people are sprinting to try and invest in it. While it all started with Bitcoin, today there are plenty of different cryptos to choose from and to invest in. Although they are essentially just virtual currency, it is now so much more than just that.
If you want to start learning how to invest in crypto and make money from it, here is everything you need to know to get going?
Understand the Risks
Investing in crypto is more than just buying and selling different cryptocurrencies. There is so much involved in the process and by understanding it all, you have a better chance of understanding the risks involved too. It is important to note that there are quite a few risks involved in investing in crypto.
This whole process relies heavily on new technology that is ever-changing and quickly evolving. At first, it may seem very complicated but once you understand it and get the hang of it, it is quite simple. Crypto is incredibly volatile and you should always understand the risks involved. If you have a lot of different investments it can be tough to keep track of them all. That’s where a free portfolio tracker comes in handy. With a portfolio tracker, you can see all your investments in one place and get an overview of how they’re performing.
Another thing to keep in mind is that crypto investing all happens online and this means that there is an increased potential for scams and for hacking to take place. Before you get started with crypto and crypto arbitrage trading you need to know what you are getting yourself into and if it is worth the risk.
Moving on down our list, the next thing that you need to know before you start investing in crypto is Dollar Cost Averaging. By definition, dollar-cost averaging is when you set recurring buys at regular intervals for a fixed dollar amount. Essentially this means that if the price of the investment that you have made falls during the period when you are dollar-cost averaging, then you have a far better chance of making a profit, given the prices move back up.
This is a great idea for those who are just starting and looking for something low-risk. Rather than putting a lump sum into the market all at once, your purchases are made over time and at intervals which means the risk of losing money is reduced drastically. This method is far safer and something to consider as a beginner.
Research, Research, Research
When it comes to crypto trading and investing, research is your best friend. You literally cannot be successful in crypto investing unless you have done your research. Before you invest in any currency or coin, you must make sure to do as much research as possible.
Doing research is a great way to learn more about the different coins but it is also a great way to learn which are the best to invest in, which to avoid, which will likely be successful, and which are probably going to fade away. Research is absolutely everything in this industry. You need to know what you’re investing in before the transaction.
Choose an exchange
Moving on down our list, the next thing you should look into is choosing an exchange. Essentially, an exchange is a business that allows you to trade different cryptocurrencies with others. This could also be traded for assets or even conventional Fiat currencies.
Crypto markets or exchanges operate 24/7 and they are incredibly helpful. When it comes to looking for an exchange, you want to find something that is reliable and trustworthy. These exchanges typically have lots of coins, liquidity, positive reviews, and more.
Always Use 2FA
Last but not least, you must always make use of 2FA, also known as two-factor authentication. Essentially what this is, is the requirement to put in two forms of authentication or passwords, to access your crypto wallet, exchange, or something else.
This is incredibly important, especially since you are dealing with money. It is a great way to protect yourself from both scams and hackers.