It is the 101 beginner’s guide. Learn all about cryptocurrency and bitcoin investment.
If you planning to get your feet wet in Bitcoin investments it is best to follow some expert tips. Investing in cryptocurrencies is not without its share of risks and uncertainties. However, there are some easy-to-follow guidelines that will place you in good stead when you make the first move:
1. Research well
It is very important to do homework before starting out on the path to Bitcoin investments. Newcomers cannot expect to become millionaires overnight by simply investing in these crypto coins without an in-depth understanding of how the market works. According to Kuskowski, the co-founder and CEO of Coinfirm, the more one understands the market the better off he is going to be. According to him, while the Bitcoin does offer a rather rare opportunity to investors, it has to be treated with caution.
Lucas Geiger, CEO of Wireline, also feels that investors need to have a very strong hold over the blockchain technology, which is the ledger underlying all digital currencies. So, before investing, your job is to identify a trusted resource or individual who you can reach out to for resolving your queries.
2. Be careful
The trick to investing effectively in the Bitcoin is to proceed with a lot of caution. Investments can never be devoid of risks but investors have to understand that the cryptocurrency market is still in its infancy and not like the traditional stock market. Use of automated trading applications is also on the rise and one has to be very careful in choosing the reliable software application. This automated bitcoin trading immediate edge review will help you understand how the automated bitcoin trading software application works. Since the risks are very high, it would be foolish to invest money which you cannot afford to let go off.
It is best to start off with smaller amounts and then move on once you get profitable returns. Instead of chasing the Bitcoin, investors must choose an entry point and then stick to it. When Bitcoins have reached a desirable value, the trick is to follow a “stage in and stage out” principle, so that they should invest some and wait for a while before investing again.
3. Diversify your portfolio
Although in recent times the Bitcoin has shown remarkable profits and the media cannot stop gushing about it, it is important to remember never to put all your eggs in one basket. It is wise to have a diversified portfolio of cryptocurrency and bitcoin investment. Do buy altcoins other than the Bitcoin. This will ensure that even the Bitcoin value falls, there will be profit from some other quarter.
When one currency falls 10%, ideally another crypto asset will increase by the same margin according to CryptooGuide.
4. Use wallets
The Bitcoins you earn should be securely stored in digital wallets. Coins should ideally not be kept in exchanges as these have often got hacked, and Bitcoins stolen in the process. While you can buy the Bitcoin in an exchange, you must transfer it to your digital wallet.
There are both online or “hot” wallets and offline or “cold” wallets. These are great ways to save your cryptocurrency and bitcoin investment.
5. Prepare for sudden changes
The cryptocurrency market is known for volatility and the Bitcoin is no exception. However, a huge fall in prices does not indicate a disaster. The best way to tide over these times is to have a diversified portfolio in hand. Investors can also try the “buy and forget” strategy since not monitoring the market continuously can prevent you from worrying all the time about the dips.
The crypto market has huge ups and downs on a daily basis. The latest example is of the superhit web series of Netflix titled ‘Squid Game’. Cryptocurrency based on this series got launched, it saw around one-week gains of nearly 310,000% and then it became zero in an instant. So, before buying anything, do proper study to enter into the market of cryptocurrency and bitcoin investment.