Cryptocurrency has grabbed the attention of one too many people over the last few years. Currencies like bitcoins have exploded all around the world. In fact, a lot of people are actually investing in currencies that we now collectively call, cryptocurrency. Statistics go to prove that almost eight percent of Americans actively invest in cryptocurrency. The majority of us have heard about cryptocurrency and even associate with concepts around bitcoins but have no idea how to invest in them. The following tips will give you a great idea behind how and in what ways you can invest in cryptocurrency
Invest in a cryptocurrency wallet
Once you have purchased your currencies be it bitcoins, ethereum, ripple or litecoin you need a wallet to store your currency in. Your wallet is basically a space to keep your currency safe. You can opt for either a software wallet or a hardware wallet. It is better to get a software wallet if you are going to engage in active trading. You will automatically gain access to a software wallet when you sign up for accounts to make any sort of exchanges.
Build a good crypto portfolio
In the stock world, it is very important to have a diversified portfolio. It works in the same manner with the crypto world. Having a profile that exhibits an array of different coins and currencies that you have purchased, your portfolio is more likely to be shielded from any losses or dips in the cryptocurrency domain. The crypto world is very unpredictable and volatile and thus it is important to add diversification to your portfolio.
Be aware of all the available currencies
Until the year 2016, the only currency that was categorized under cryptocurrency was ‘bitcoin’. There were also altcoins that was mostly associated with stocks on online markets. However, the game has completely changed now. As a result of the bitcoin performance going down, many other currencies like ethereum, tether, litecoin, XRP, Stellar and many more came up. It is essential to know the marketcap of all of these currencies to understand the closest value of a cryptocurrency.
Know what you’re getting to
Read whitepapers without fail
Once you’ve decided on what coins to invest in and purchase into your wallet, the next step is to understand the contribution it has to the ecosystem. Reading whitepapers gives you exactly all the information you will need regarding the same. A well-written whitepaper will give you confirmation that it is a project worth trusting your money with and vice versa. Whitepapers are the ultimate guidebook that helps you make decisions and solve problems in the cryptocurrency world. At one point we were auditing a company that was talking about spotify plays and the need to buy monthly listeners spotify and we started to see links that were still relevant to the technology industry but not necessarily related to the cryptocurrency industry.