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5 things you should know before investing in cryptocurrency

The world of digital currencies is very wide. You don't find it stops at Bitcoin or Ethereum. Therefore, you will need at least training and in-depth research and you should use common sense in order to grow your investments.

5 things you should know before investing in cryptocurrency

Through these various tips, we will guide you step by step to make your first investments. So let's look in detail at all the important points that you should pay attention to before depositing your money to buy any cryptocurrency.

1- Invest only money you can afford to lose

One of our first tips on investing in cryptocurrency that big investors always advise is: just invest money you can afford to lose.

The money you invest should be money that you don't need in your daily life or don't expect to need anytime soon. If you lose that money, it will not affect your life.

Do not put the last remaining $300 in your bank account in cryptocurrency. Do not take out a loan from the bank until you invest in digital currencies.

My friend, we know that you are the one who makes the final decision, but please don't be complacent and take these tips into consideration.

Investing in digital currencies sometimes requires patience. The prices of Bitcoin and other digital currencies are notoriously volatile.

But this is not always true, Bitcoin price curve was flat for example in the second half of 2018… So, you can make gains/losses as fast as you can if you plan/not plan well.

In the event that the market is not in a good condition, the return on investment can be longer than expected.

This means that you will inevitably go through a phase of losses. If you need that money to live, here's what it can cause:

  • Your investments will be withdrawn at a realized loss.
  • Your morale may be severely affected in your daily life.
  •  You will try to return your lost investments by doing irrational things, which will inflate your losses even more.

Believe us, my friend... We have all been through this situation, so we advise you with all our heart that you should only invest money that you can afford to lose.

This way, you won't act on your feelings because you won't care if you lose that money anyway. The negative effects we just mentioned will therefore be less likely to occur.

2- Study the topic beforehand

As a second step, we suggest that you research carefully any particular topic or project before thinking about investing your money in it.

Even if many people advise you to invest your money, do you really want to invest in a project that you do not know at all? Do you trust people blindly without doing enough research into the project they recommend to you?

Let's just give you an example:

Can you buy an apartment or house without visiting it?

Can you buy a used car without its papers?

Can you buy an annual gym membership without looking at what it looks like or what services you provide?

If you answered these questions with no, you should also educate yourself about cryptocurrency technology before investing your money in it.

Obviously, we are not asking you to be an expert in cryptocurrencies before you start investing in them, but the point here is that you should give yourself enough time to understand how this technology works.

3- Diversify your investments

After the first two tips before investing, our third tip will focus on diversification.
This concept is important in many aspects of your life and is also valid for cryptocurrencies.
If you have some money that you want to invest, you probably know the saying that “you should not put all your eggs in one basket”.

If your basket falls to the ground, you can break all your eggs and you will lose everything.

If you have 10 eggs divided equally into 5 baskets, you will only lose 2 eggs if one of the baskets falls.

Therefore, it is appropriate to apply such thought when investing your money. It can be divided as follows:

  • Put some of your money into real estate.
  • Put some of them on the stock exchange.
  • Putting part of it in digital currencies.

In the same way, the part of your investment should also follow this principle. It will be necessary to diversify your investments by investing in different digital currencies. The goal is to minimize the risk.

4- Carrying out exchange transfers at the exchanges

Did you follow the first 3 tips? .. great!

You will now be able to start buying your first digital currency! For this, we advise you to use a cryptocurrency buying platform or a financial broker.

This platform allows you to buy very popular digital currencies like Bitcoin or Ethereum.

To buy other cryptocurrencies that are less popular but with greater growth potential, you will need to convert Ethereum and Bitcoin into those other altcoins via remittances.

These platforms are called “Exchanges”, and they are platforms that enable you to buy famous digital currencies such as Bitcoin or Ethereum, or exchange your bitcoins for alternative digital currencies called Altcoin.

It can be found simply via Google search, or through trusted brokerage firms in your country.

5- Beware of scams 

Our fifth tip is about all the scams that exist in the cryptocurrency world

One should be especially vigilant about this and try to avoid these scams as much as possible

We advise you to research carefully in this topic and search in detail for “attacks” or cryptocurrencies whose name has been associated with any kind of fraud so that you do not fall into these traps.

We also advise you to search for a reliable money market broker with which you can buy cryptocurrencies.

5 things you should know before investing in cryptocurrency


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