There is a growing market demand for cryptocurrencies and more people are placing their bets on several coins hoping that they will turn out to be as big as Bitcoin or Ethereum in a few years.
However, there are over 18,000 cryptocurrencies in the market today, according to Coinmarketcap, and it is almost impossible to predict the future performance of all based on how it’s being marketed, or their current price.
The truth remains that out of all the cryptocurrencies in the market today, only a few will perform best in time.
Considering that, here are five tips to help you better invest in cryptocurrencies wisely and sustainably.
Conduct Your Research:
There is a lot of hype that goes on in this space. If you didn’t know, most coins have a community of marketers who are responsible for growing the community and making sure that more people buy the coin. Hardly a lot of people know this about the crypto space which makes it important for you to conduct deep research on any project and its cryptocurrency before buying it.
Research is the most important discipline that an investor must take before buying into a crypto project or betting on its long-term viability. When you do your own research (DYOR) before buying any cryptocurrency, you will find out details about it that help you consider whether or not it’s going to be profitable for you and your portfolio altogether.
In researching a cryptocurrency, you must find out whether the project has a sustainable use case, an experienced and trustworthy team (based on the projects they have been involved with), a comprehensive whitepaper, a realistic project roadmap, and well-designed tokenomics.
The above five factors are crucial in determining if any cryptocurrency is worth your investment and these should be the main outcome of your research. It doesn’t matter what you’ve heard from anyone online, DYOR!
Don't Go All In:
Whether investing in cryptocurrency, stocks, foreign exchange, or businesses, it is not wise to invest all the money you have in your entire bank account.
Because the crypto market is relatively new does not mean that it’s meant to be an easier and faster means of cashing out.
A tip is to only invest some money that you can only afford to lose and not money that you may need in a few weeks.
Pick an Investing Timeframe:
Before you invest in a cryptocurrency after conducting your research, another important tip is to pick a timeframe that you want to invest in the cryptocurrency for.
How long would you want to invest?
It is never advisable to invest in any crypto indefinitely, especially because of the volatility risks involved in the market. So you should have a set time frame. It could be anything between a 4-12 month period based on your expected returns.
Whatever time frame you pick, ensure that it is realistic enough based on the cryptocurrency you’ve chosen to invest in.
- Keep Yourself Up-To-Date:
Keeping yourself up-to-date on the news in the crypto space is also most important. This tip can constitute part of your research before investing in any cryptocurrency but even after investing, it is a habit you must build as an investor.
Crypto Economy reports news and events that take place in the crypto industry. Stay up to date on news about your investment and what happens in the world and understand how it may adversely affect your investment in the crypto space.
- Choose a Suitable Platform
Lastly, you must know that as much as there are many cryptocurrencies there are also many crypto exchanges offering a variety of services.
There are many platforms in blockchain and as an investor, you should research and understand the various services offered by exchanges or crypto companies for you to choose the ones most suitable for your crypto investment needs.
There are over a thousand tips on the internet to help you invest in cryptocurrency but to truly get the best out of your investment you need to overlook the hype in this space and get over the fear of missing out so that you can do due diligence to build crypto investing experience in these early stages.
Remember to take it step-by-step.
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