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How to start cryptocurrency investment journey?

Every beginner in the crypto sphere gets excited whenever they learn about it, apparently content with testimony they here on how the invention has changed a number of people’s lives over time but they fail to apply a good investment strategy in order to acquire a reasonable amount of profit. Here is a beginner’s guide on the right tactics to acquire before making a purchase of any crypto asset.

There are so many areas one can invest his/her money in this great ecosystem which includes holding your coins, trading, cloud mining, ICO etc.

Holding (HODL)

This is one of the best and safest methods of making a profit over a long period of time, it has to do with making a purchase of a coin and leaving it in a wallet with the hope of its value rising after some time, maybe months or even years.

Most of the people who made millions now where those who made a purchase at the early stage and held until their targeted price before selling off (dumping). At December 2012, Bitcoin was worth $13 and as at December 2013, it was already worth $1000 which amount to a growth of about 10000%.

Ethereum launched its platform in 2014 and sold its coin at around $0.1. But as at the time of writing, 1 ETH is now worth over $820 which amount to a growth of about 820,000% in 4 years. Holding has paid a lot of people and will still pay much more in this field.

Trading

This is another method a beginner can adopt in making a reasonable amount of profit over a short period of time. Trading simple means exchanging between coins in order to make a profit, it’s called a buy low and sell high cryptocurrency strategy.

The trading market is just like any other stock market, the only difference is that the government don’t have control over them due to the decentralized nature of the blockchain. Exchanges are online platforms where one can trade.

Mixed strategy

This includes long and short-term tactics one can adopt in order to acquire profit on his/her money invested in this ecosystem.

Savings

This is a long-term crypto investing strategy. Instead of leaving all your savings in a bank, one can acquire the plan of saving at least 1% of his/her asset in crypto.Imagine in 2012 you saved 1% of $10,000 which amount to about 8 BTC, but is now worth $75070 in 2018 after 5 years. This is a good return for such small investment.

Things newbies have to consider before dealing with cryptocurrency

The team behind the project

It is very important to know the team behind every new blockchain startup before investing your money, make sure they have a good number of experience and have made name already in this ecosystem.

Check the feasibility of the project

Before investing in any new startup, the workability of the project must be checked. Most startups these days come up with a project that cannot be visibly obtained thereby leaving their coin at a stage where we refer them as useless.

Review from experts

Always check for review about the project from experts who have done their research and can tell if the project is feasible or not.

Check market cap and rankings

Before making a purchase of any cryptocurrency, it is expedient you check the market cap and safety rank. High market cap most time shows that the project has the attention of the community. Cointobuy.io safety rank will show the numerical recap of many different factors related to the certain coin.

Check the total supply

Price in the market is mostly determined by the law of demand and supply, the higher the demand, the lesser the supply. Try making a purchase of coin with lesser supply if you want to make a profit within a short period of time. For example, Bitcoin has only 21 million that will ever exist, this means the more the demand for Bitcoin, the lesser the supply due to scarcity.

Why is crypto investment different from others?

We have so many investment plans in the world, this includes buying stocks, shares etc. but I would enlighten you why crypto is different from others.

Decentralized

Other types of investment are always centralized in the sense that they are controlled by an individual or group of individuals. These individuals determine the percentage return on investment one get after a period of time, unlike the Blockchain which is a free and decentralized market where the profit percentage is solely dependent on the demand for the coin. The more this innovation is adopted, the higher the price soar.

Free and fair

Since it is decentralized and not owned by anyone, every investment is open and fair. For example, everyone who makes a purchase of a coin at the same time gets the same percentage growth when they hold, unlike other platforms where there can be manipulations and percentage return is mostly based on the amount invested.

Don’ts while choosing crypto investment

Don’t leave the coin on the exchange

Exchanges are mostly centralized and don’t give one access to his/her private key which is the fund itself. The community has experienced many hacks on exchanges starting from one of the biggest bitcoin hacks in 2013 on mt.GOX which was the only popular exchange available for trade, the hack lead in $460 million loss.

This money where funds of users who left their coins on the exchange. This lesson has always taught us in teaching newbies to make sure they take their tokens off-exchange into a private wallet or a hardware that gives you access to your private key.

Don’t invest without proper research

Always make sure to do a deep and proper research before investing in any blockchain startup in order not to lose funds.

Don’t spread FUD

Ignore any FUD news by mostly the government and central bank, which is done to scare people away from this great innovation.

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