The recent decline that crypto coins have experienced is not the first. If you look at the history of Bitcoin, you will soon discover that the currency returns stronger after each fall. And that fall itself is perhaps not even the worst thing that is happening. The worst thing is when you see the market coming up again and then think to yourself: “If I had known, I would have bought some coins”.
You can earn good money from crypto coins and you can even achieve a return of 1000% within a year. But you can lose all your money just as easily in a matter of seconds. In this article you will find a few tips for those who are willing to jump into this.
1. Do extensive research before you invest
The first step when you get started with crypto is to understand the underlying technology blockchain. Forget about the technical jargons for now. Nobody has to convince you of the revolutionary blockchain technology. A good starting point is reading articles, visiting online forums and following vlogs about cryptos. You will soon discover why governments and companies are exploring this nascent technology and how they want to integrate it into their systems. But you also discover why banks are afraid of blockchain and see crypto coins as a threat to their existence and therefore try to limit their growth. This view will help you to deepen your knowledge of this topic and to explore the possibilities of the potential of blockchain technology.
It is also important to not make the mistake of entrusting someone else with your money. The purpose of crypto coins is to enable everyone to own real money without having to involve third parties, such as banks. It is very common for scammers to abuse the naivety of newcomers in this unregulated market. That is why this requires extra caution.
2. Invest only what you can afford to lose
Invest only what you can actually lose. This is because the market is exceptionally volatile. It is a market that is fuelled by hype and market sentiments rather than fundamental elements. This makes the cryptomarkets extremely risky and that is why you have the potential to make a lot of money or lose everything in one moment.
Always be careful and please do not take out a mortgage on your house and do not take out a loan to be able to invest in crypto coins, because you will sign your own death sentence.
3. Focus on the long term
You always have to stay focused in the long term because the technology that underlies crypto coins is still an infant and it may take a while before the technologies and the various innovations within the cryptocurrency ecosystem are ready for everyone to adopt. Short-term trading in this extremely volatile market can be disastrous, especially if you do not have experience and knowledge about trading.
4. Diversify your portfolio
Your cryptocurrency investments must be distributed equally across the market. There are more than 1,600 different coins and tokens to choose from.
Bitcoin (BTC) and Ethereum (ETH) are the oldest and largest cryptocurrency and represent the base currency of the world of cryptocurrency. That is why it is advisable to always make a substantial part of your investment in both currencies because they are relatively stable and facilitate the exchange with other altcoins.
After that it is recommended to spread the rest over valuable altcoins with the potential to make a profit. Look for coins that solve real-world problems and ignore shitcoins. You must learn how to identify shitcoins and coins with a good foundation.
A well-built portfolio is a solid basis for a better return.
5. Keep a watchful eye over your losses and profit
The key to profitability in this area is to buy it cheaply and sell it at a profit. You have to pay attention while placing a purchase order and also observe when the market is moving in an upward direction so that you can count your profits. Here is a guide for calculating your crypto winnings. If you can pay attention to this, you will probably be able to conquer the cryptomarket like a superstar.