Beginner’s Guide To Investing in Crypto

Getting in has never been easier.

Cryptocurrency investment has been all the rage in 2021. From Bitcoin’s early year rise to historic and record breaking highs, to Dogecoin making millionaires out of $500 investors. It seems like no matter where you go, crypto is the talk of the town. In fact, the craze for crypto is equivalent to that of the California gold rush, in which massive amounts of people migrated to the pacific state with the hopes of striking it big with gold. Allow me to make one thing clear, if you are just starting out you need to know a couple of things before you rush into crypto investment. My main tips are as follows and I will explain each in detail:

1. Do Your Own Research.
2. Stay Away from “Shitcoin.”
3. Do not Day Trade Unless You have Time and Money to Blow.
4. Never Buy What You Can’t Afford To Lose.
5. Don’t Listen to Reddit

I’ll begin with point #1. Do your own research. It is critically important that you research each cryptocurrency before you invest. You need to have a good understanding of the technology underlying the blockchain. Most legit cryptocurrencies have a white paper that you can read. The white paper is a guide to how the technology works, along with refined technical explanations of the programming and security of the coin. Before you invest in any coin, you should seek out the white paper.

Second point, stay away from shitcoin. Shitcoin is coin that will naturally have no value in the future. It is essentially a hype coin that is inflated by deluded masses who believe the coin will “moon” overnight and make them ridiculously rich. I’m as much a dreamer as anyone else, but the reality is early investors in bitcoin waited 6–7 years before getting ridiculously rich. I won’t specifically call out any coins but if it is named after a dog (or dog breed, dog sound, etc), food, sexual byproduct (position or act), or slang, it is probably shitcoin.

Point 3, do not day trade. Just… don’t. Seriously. Save yourself the time and money and avoid day trading. Day trading is for people who have lots of cash to throw around. They’re technically already rich but just want to make more money buying dips (periods of reduced crypto prices) and selling at the first sign of a peak (increase in prices of a coin). Following up with say traders will make you some money but if you are entering crypto with very little cash — or you just want to be sensible—then avoid day trading and invest for the long term. This also goes back to point #1. When you flip flop for profit you’re just hurting the potential for a coin to grow.

Fourth point, never buy what you can’t afford to lose. I’ve heard nightmare stories of people who have placed their entire retirement income into cryptocurrency investment. Ridiculous! Only invest what you can afford to lose means investing using money you wouldn’t use for anything else (credit card bills, rent, mortgage, etc). Look to put no more than 5% of your bi-weekly income into crypto. It’ll give you a good foothold and if you get loose change later on down the line you can add more.

Final and most important point. Never ever ever listen to Reddit. The folks on Reddit are often hype beasts, blind fans, or Elon Musk zombie investors who believe Dogecoin will become the currency of the future. Back in the day I used to read a lot of chatter about crypto to pick up on trends for what was hot and what was not. But, there’s too much noise on the platform. Every coin is seemingly “hot” on reddit. Do yourself a favor and stay away from the reddit crypto community. Educate yourself and keep your thoughts untainted. If you have to communicate with someone about crypto, have a small group to bounce thoughts and ideas off of. Otherwise you risk being inundated with crappy ideas for how to invest in Crypto.

Those are a few of the tips I have used to guide my investment in Crypto so far. Even with the current crash I am still in the positive thanks to smart buying tactics and investing based on quality and potential of the coin rather than listening to the hype. I hope these tips help you.

Source: https://nsokol44.medium.com/beginners-guide-to-investing-in-crypto-64eec27d39c8?source=rss——-8—————–cryptocurrency