Some people have made millions of dollars by investing in cryptocurrency. It’s a true testament to how lucrative crypto can be but for someone who knows little to nothing about crypto, it can be very intimidating. All the jargon and slang can rattle aspiring investors, even those who have a heavy interest. Once they see the first word they don’t understand, it can send them running. Crypto has come a long way from where it started out, and now people are able to build a career in this sector with crypto business development jobs up for grabs. However, that is a topic for another time as we need to delve into the investment side today.
To begin investing in cryptocurrency, you’ll want to explore the different aspects of buying cryptocurrency.
Before beginning your cryptocurrency journey, there are a lot of things to consider. It’s best that you have a game plan before you start putting your money in. Here are a few things to consider before investing:
Figuring out your game plan
Ask yourself these questions:
- What is my goal? – Some people invest in cryptocurrency for the sole purpose of making a profit. Some people invest in a cryptocurrency they believe in, one that will change the future of finance. You have to decide which one of these people you are.
- What are my limits? – How much money are you willing to lose by investing? Not all investments pan out and that’s just a part of life. The $100 you put in must be $100 you’re willing to lose.
- How much is enough for me? – Once the value of your crypto goes up, you have to make sure that greed won’t get the best of you. Cryptocurrency prices are very volatile and can change drastically overnight. At what point will you say “I’ll take it” and cash out? Emotions run high in the cryptocurrency game, make sure that they don’t get the best of you.
There are a lot of cryptocurrencies to invest in. You can go with more popular cryptos such as Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Ripple (XRP). If you want to go with more of the “undervalued” cryptocurrencies like NEO (NEO), then go for it. Just take note that cryptos such as BTC, ETH, LTC, and XRP are popular for a reason – they’ve proven to be good investments in the past. Going for the undervalued cryptocurrencies have the chance to give you more money but it comes at a higher risk.
With that being said, you can also go on the route of investing in multiple cryptocurrencies at the same time but if you’re just starting out, it’s highly advised for you to focus on one.
The different ways to buy crypto
Depending on the cryptocurrency you’ve chosen, you will be glad to know that there are many crypto exchanges that people can access when they want to buy any form of digital currency. By reading their reviews before jumping into using a service, you will be able to learn all that you can about the different options that are open to you.
For example, traditional bitcoin exchanges buy and sell via order book. On the other side of the spectrum, there are peer-to-peer platforms that match buyers and sellers. Traditional exchanges are very simple and easy to use. They usually work with banks so it might be worth looking into banks that accept bitcoin and other cryptos. Peer-to-peer platforms are better for more unconventional payment methods such as gift cards.
On these platforms, you can trade almost anything, so be sure to choose the best option for you.
Different trading strategies
When you start investing in cryptocurrency, there are many different trading strategies to consider.
Do you want to be a day trader? These are the people who make trading their full-time job. They observe the changes in price and make trades that could earn them a little bit of money. By the end of the day, they have no more open positions.
Do you want to be a holder? These are the people who invest in cryptocurrency as a side gig. They buy coins in bulk and wait for their value to increase over time. They could be holding coins for as little as a week to a few months to maybe even a few years.
Make sure that you consider all the trading strategies as it essentially tells you when you should sell/cash out. Take necessary precautions, conduct thorough analyses, and use the bitcoin to naira converter (or other currencies) to ascertain the best selling points, and maximise profits.
Research is key
Throughout all this, it’s best that you learn as much as possible before putting any actual money in. Follow up on crypto news, and find out about fluctuations and trends. This is so that you can minimize all the possible risks when you actually start investing. Good luck!