Crypto

Everything You Need to Know Before Investing in Cryptocurrencies

Basics of how BTC works and encouraging people to understand the underlying technology. Also a very responsible move to emphasize the cold...

Written by Niel Patel · 4 min read >
mock-crypto-trading-competition

It’s probably happened to you or a friend or a family member with no previous interest in the market has asked for your opinion on buying crypto. Definitely. I think I get a lot of people asking me, what should I buy? What’s the next thing that’s going to go up? It’s not just you. A survey of 1000 adults in the United Kingdom revealed that nearly half of the people aged between 18 and 29 made their first-ever investment in cryptocurrencies. 

The cryptocurrency market is worth trillions. In November 2021, its total market cap reached $3 trillion. For the first time, it’s no wonder it’s capturing so many people’s attention. So what should you know before you get involved? 

If you don’t have too much knowledge or you’re not an expert in bitcoin or the way cryptocurrency works, that’s completely okay, because I’m gonna be going over everything that you need to know in order to get started today in this article, we’re gonna be going over how to invest into Cryptocurrencies for this year. 

Things to take care of before your first investment

This is a concern shared by the UK’s financial watchdog, the Financial Conduct Authority, or FCA. Its survey of young investors in high-risk products aged between 18 and 40 found that they are driven by competition and influenced by hype.

Financial Conduct Authority
Financial Conduct Authority

In fact, 58% of respondents said that constantly hearing about a certain investment on the news, on social media and from other people encouraged them to. Specific investments. I don’t think it’s right to say that people can make money or if you’ve missed out on Bitcoin, this is the next big thing.

And I’m hearing some real personal success stories in my own life of people I know who are making hundreds of thousands of dollars in cryptocurrency. So I don’t want any of you guys to miss out, because if you have this mentality that, oh, it is way too late, I will not be able to get in there as well. 

That’s far from the truth. I think we are still in the early stages of the development of cryptocurrency, especially bitcoin, and one of the most important things that you can do is to invest. Now get started now.

Okay, so let’s start this off by talking about the background of bitcoin, what it is, and how it all works to break things down. The easiest way to explain the way cryptocurrency see works is this is just a peer to peer transaction.

So if I wanted to send you money, I would do it through venmo or cash app or PayPal. If I’m trying to venmo you some money, what happens is I have my $10 and I want you to get it. It doesn’t go straight from me to you, although that’s what we see on our end.

The back end of these transactions often entails a third-party company that handles the exchange. I really want you guys to pay attention to this, talking about the dangers of using some of the most popular apps like PayPal and Venmo. 

And this is one of the things that cryptocurrency is here to do. To help alleviate and to solve. Aside from those things, we’re not even going to go into the topic of security and the liability that the banks have in trying to have all of our money and the instability of the fiat currency.

All you need to know is that there are a lot of downsides when you are using a primary peer-to-peer system that relies heavily on different entities outside of our control. With cryptocurrency or Bitcoin, you get something called a wallet address.

An official better understanding of how this all works. They state on their website bitcoin.org. Bitcoin uses peer-to-peer technology to operate with no central authority or banks managing transactions. And the issuing of bitcoins is carried out collectively by the network. 

So there are a ton of different companies out there that have created platforms in order to trade cryptocurrency. Many of these companies are going to want you to start banking with them, because odds are if you deposit your 1st $1020 with that specific platform, chances are you’re going to be using them for the duration of your cryptocurrency investing time.  Let see how to invest in crypto.

Tips to invest in Crypto in 2023

Definitely. Before you make any financial decisions, make sure you understand what you’re investing in. That’s definitely the number one rule. Asking yourself these questions

  • Does the funding team hold a large proportion of the tokens? 
  • And are they barred from selling them all at once?
  • Is the project trying to raise too much money by overestimating the value of its tokens?
  • And what does the project do? Does it add any real-world value? 

How To Invest In Crypto Full Beginners Guide in 2023

Don’t invest at all in cryptocurrency. Make sure if you want to do it, make sure it’s a very tiny fraction of your overall portfolio. Your investment portfolio should be diverse. 

Previous events around the world, ranging from bank accounts being frozen to economic sanctions due to several conflicts, have trusted the cryptocurrency market. This has widely affected the cryptocurrency market, making global economic conditions worse. Everyone wants to maintain wealth, and this is after finding a reliable way to transfer value across towns and to the borders for business. Valuable products in the market have made many people find themselves scrambling to learn about gaining access to crypto. The advantage of crypto is that it offers protection against several furious storms. Are you ready to learn about crypto and get into the market?

Consider some factors before investing in today’s cryptocurrency market.    

1. Do Your Research Before Taking Any Action  

Take your time to research before investing by looking deeper into these projects to determine whether they will last. If you are an investor ready to invest, bet at Ethereum sites and consider working with cryptocurrency and enjoy the cryptocurrency market. Determining how long a project will last is important since what you are planning is something you are interested in, and you might take some time in it. Never be in a hurry to buy something, maybe because a friend told you to buy it. There are times when one is tempted to, mostly if they are promising and one is guaranteed returns. Make sure you refrain from engaging in what you are not sure of.    

2. Time is The Key    

Everyone has the best intentions when they engage in the cryptocurrency market. Nearly all investing in the crypto community is driven by emotions which can sometimes lead to wrong timing. Whenever this happens then, investments result in poor value. A token moving in the market forces tends to conspire, driving the rally higher. Remember that everyone investing cannot resist the fear of missing out since all want to make profits. Be sure of a solid project trading flat but deflecting a good promise. However, be ready to wave higher and take profits at the right time.   

3. Only Invest What You Can Lose  

As you are aware of how cryptocurrencies are risky and, at times, make tokens go to zero with time, make sure only to invest what you cannot afford to lose in the market. Have plans on the funds you plan to use in the crypto market. It is good to use what is left after all your expenses are covered. It is good to have an extra amount set aside for unexpected expenses which can arise anytime.    

4. Keep The Long-term in Mind  

It is never a good idea to keep in mind that you involve yourself in the cryptocurrency market to acquire fast riches with all you invest. It is easy with such a mindset to get scammed since many are out there waiting to fraud those new and are willing to invest as soon as possible. Are you ready to invest? Find a project with a real-world use case that supports the community and is dedicated to slowly accumulating within the period you are in the market.   

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