Nowadays, the cryptocurrency is considered one of the most lucrative and massively adopted markets. No wonder, more and more people, even those who don’t have a relevant experience in trading, strive to enter it. But as with any business, beginner investors make lots of mistakes before starting to earn money and taking their venture to the next level. In today’s article, you’re going to find the answers to the frequently asked questions and hopefully, avoid the risks commonly experienced by beginner crypto traders.
#1 Get to Know the Industry
First things first, you need to research the industry and the market you’re going to enter. Make sure to read the articles about the subtleties of mining, trading and exchanging digital currency, risk management, and lots of other things pertinent to the crypto industry. It’s is a good idea to start off with researching the history of the celebrated Bitcoin and learning what is behind the blockchain technology. You may want to watch a bunch of educational videos which can be found in abundance on YouTube and other web resources. Once you familiarize yourself with and understand the ins and outs of the industry, you may move on with your crypto quest.
#2 Choose Reliable Exchanges
Unlike Forex and other traditional stock exchanges, digital currency exchanges don’t require you to hire professional brokers to perform any financial operations. The best thing you can do is become a professional trader yourself.
You would be well-advised to locate and research the existing exchanges, the places where you can purchase, sell, and trade various cryptocurrencies. There are countless options on the web, but not all of them are trustworthy and reliable. Not to lose your Bitcoins or any other digital coins, you need to make the right choice. For the time being, among the most reliable and time-tested crypto exchanges are Bittrex, CoinBase, Binance, CoinMama, Poloniex, and others. Besides, there are also dedicated platforms that monitor the exchange rates across different exchanges and inform you of the lucrative offers currently available on the market. Changevisor is one of such platforms. So, if you’re looking for the best PayPal to BTC exchanger or convert your crypto to fiat, you definitely want to visit Changevisor first thing.
#3 Invest What You Can Lose
As the golden rule of business says, you should always invest as much money as you can afford to lose. Not-so-long history of crypto industry has known the cases where hobby investors went broke literary overnight. Note that they are not only scam exchanges and violent fluctuations that can deplete your crypto prosperity. There other objective factors like government regulations, negative Bitcoin prognosis, hacks, and bucks that can turn your fortune into peanuts in the blink of an eye. With that being said, make sure to invest only what you can lose.
#4 Keep Track of Bitcoin
No doubt, Bitcoin still reigns of the digital currency kingdom. So, you want to keep an eye on Bitcoin, the most promising crypto, to keep abreast of the recent changes in the crypto industry. If Bitcoin plummet or, to the contrary, skyrocket due to some reasons, the odds are good other currencies will follow its example.
#5 Invest in Different Coins
Another good rule of thumb you want to take note of is investing in different type of cryptocurrency instead of opting for a single coin. Though Bitcoin is arguably the most performing crypto, it would be unwise to set your sights only on it. Think of the crypto market as a huge construction that’s propped up by multiple pillars, which are cryptocurrencies. If one of the pillars gets wobbly, chances are good others will manage to get through the tough times. Thus, you’ll manage to dodge the bullet and avoid the risk of losing your hard-earned money. Moreover, if you decide to diversify instead of piling all your eggs in one basket, you’ll increase your chances of reaping benefits from multiple cryptos when the time comes.