How to Invest Safely in Cryptocurrency: A Guide for Investing for Beginners
How to Invest Safely in Cryptocurrency: A Guide for Investing in Crypto for Beginners
Although cryptocurrency has only been around for less than two decades, it has expanded into a wide, convoluted universe that can be difficult to understand for the uninitiated.
Let’s be honest, the advice to “invest in what you know” is hard to heed when you’re trying to build a diverse portfolio.
But with Bitcoin and other cryptocurrencies seeing wild fluctuations in price due to their volatile nature, there’s an opportunity for big gains and wins, if you can stomach the risk.
The most popular cryptocurrency, Bitcoin, has had volatile price moves this year, reaching nearly $65,000 in April before losing nearly half its value in May. In recent weeks, the price of bitcoin was back in the $45,000 range (You can check the current price to buy Bitcoin here.)
Had you bought bitcoin in early April 2017, for example, you could have seen a 3,700% return in just four years.
But there also have been plenty of price plunges along the way. If you’d bought in mid-April of this year, you would have lost more than half your investment in just four months.
Cryptocurrency Investment platforms like Coinbase and Bitcoininvestmentrex have made it significantly easier for people to invest in popular cryptocurrencies like Bitcoin, Ethereum, and Bitcoin Cash. However, the process is still slightly more complex than acquiring a more traditional currency. If you’re interested in purchasing or investing in Bitcoin or another cryptocurrency, here are the fundamentals you should know as Cryptocurrency Begineer.
What is Cryptocurrency
A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend. Many cryptocurrencies are decentralized networks based on blockchain technology — a distributed ledger enforced by a disparate network of computers. A critical feature of cryptocurrencies is that they are generally not issued by any central authority like a central bank, no one can claim an authoritarian jurisdiction over cryptocurrency rendering them theoretically immune to government interference or manipulation.
Cryptocurrencies are inherently cryptic — it’s right there in the name
Cryptocurrency got its name because it uses encryption to verify transactions. This means advanced coding is involved in storing and transmitting cryptocurrency data between wallets and to public ledgers. The aim of encryption is to provide security and safety.
Cryptocurrencies are systems that allow for secure payments online which are denominated in terms of virtual “tokens,” which are represented by ledger entries internal to the system. “Crypto” refers to the various encryption algorithms and cryptographic techniques that safeguard these entries, such as elliptical curve encryption, public-private key pairs, and hashing functions.
Best Tips to Invest Safely in Cryptocurrency: A Tried & Test Guide for Crypto Beginners
Investing in cryptocurrencies can be an intriguing prospect for a portion of your portfolio, but you should make sure to diversify your investments with other holdings.
Earlier this year, CNBC forecasted that the cryptocurrency market is expected to reach a value of $1 trillion by the end of 2018.
Bitcoininvestmentrex provides you with expertly tailored bitcoin investment plans at no cost to decide which one is right for you.
If you’re planning to invest in cryptocurrencies, these tips can help you make educated choices.
1. Research Cryptocurrency Investment Company or Exchanges
Before you invest one dollar, learn about cryptocurrency investment companies or exchanges. These platforms provide the means to buy, sell digital and invest cryptocurrencies, but there are 500 exchanges to choose from, according to Bitcoin.com. Do your research, read reviews and talk with more experienced investors before moving forward.
2. Learn How to Store Your Digital Currency Safely
If you purchase cryptocurrency, you have to store it. You can store it on an exchange or in a digital “wallet,” for example one of the crypto wallets described in this blog post Which cryptocurrency wallet to choose. While there are many different kinds of wallets, each has its own benefits, technical requirements, and security. As with exchanges, you should investigate your storage choices before investing.
3. Diversify Your Investments
Diversification is a key to any good investment strategy, and it holds true when you’re investing in cryptocurrency too. Don’t put all of your money in Bitcoin, for example, just because that’s the name you know. There are thousands of options, and it’s best to spread your investment around to several currencies.
4. Prepare for Volatility
The cryptocurrency market is a volatile one, so be prepared for ups and downs. You’ll see dramatic swings in prices. If your investment portfolio or mental wellbeing can’t handle that, cryptocurrency might not be a wise choice for you.
Cryptocurrency is all the rage right now, but remember, it’s still in its infancy. Investing in something that’s new comes with challenges, so be prepared. If you plan to participate, do your research and invest conservatively to start.
5. Don’t invest what you can’t afford to lose
We are huge fans of crypto, we conceive it as something that, in very small doses, might help clients get more diversification since it performs so differently from stocks and bonds.
We advise interested clients to invest no more than 2% of their liquid portfolios in digital currencies. In other words, they should only invest a small percentage of the money they have above and beyond their home equity and their retirement and education savings.
“By investing 2% they feel like they’re participating, but not so much that it creates problems,”
Elliott suggests having no more than 5% of your overall portfolio dedicated to speculative investments of all kinds, including crypto, but only if you have little to no debt and are willing to accept the risk of losing what you put in.
Arizona-based certified financial planner Christine Papelian thinks direct exposure to crypto is too volatile for her clients, who are primarily investing in retirement
But she said she reminds clients that they may already have some indirect exposure to crypto assets through investments in tech companies that invest in blockchain technology, which makes it possible for the crypto trading universe to function.
Or investors may have exposure through actively traded mutual funds and exchange-traded funds, which themselves may have crypto or crypto-related companies, like Coinbase, in their portfolios, Papelian said.
How to Invest in Cryptocurrency for beginners
Investing in Crypto and Bitcoin can seem rigorous, but it is much easier when you break it down into steps. Buying Bitcoin is getting easier by the day, and the legitimacy of the exchanges and wallets are growing as well.
There are several different exchanges to choose from, with the most popular being Coinbase, GDAx, and Bitfinex.
With most popular currencies, including Bitcoin, you can buy fractions of a coin, so you don’t need to invest thousands of dollars to get in the game.
What do you need to invest in cryptocurrency?
There are several things that every aspiring Cryptocurrency Begineer or Bitcoin investor needs.
A cryptocurrency exchange account, personal identification documents if you are using a Know Your Customer (KYC) platform, a secure connection to the Internet, and a method of payment.
It is also recommended that you have your own personal wallet outside of the exchange account.
Valid methods of payment using this path include bank accounts, debit cards, and credit cards. It is also possible to get Bitcoin at specialized ATMs and via P2P exchanges.
However, be aware that Bitcoin ATMs have increasingly required government-issued IDs as of early 2020.
How to invest in bitcoin
How to Invest in Bitcoin in 5 Easy Steps
Are you ready to dive into cryptocurrency? Are you ready to learn How to Invest in bitcoin and make money securely? You’re in luck, as investing in Bitcoin is simpler than you might think. Here’s how to invest in Bitcoin, in 4 easy steps:
- Join a Bitcoin Investment Platform or Cryptocurrency Exchange
- Get a Bitcoin Wallet
- Fund your Bitcoin Wallet
- Register your Bitcoin Order based on Minimum Bitcoin Investment
- Cash-out or Manage your Bitcoin Investment
1. Join a Bitcoin Investment Platform or Cryptocurrency Exchange
Before you start investing in bitcoins or cryptocurrency, you’ll need to determine where you want to make a Bitcoin purchase. Most Bitcoin investors use cryptocurrency exchanges. There’s no official “Bitcoin” company because it’s an open-source technology, but there are several different bitcoin investment platforms and exchanges that facilitate Bitcoin transactions. These exchanges are the middlemen of cryptocurrency investing, like a stock brokerage.
If you decide to purchase from an exchange, you’ll have to decide which exchange you want to buy from and which bitcoin investment platform you want to invest your bitcoins. Here are a few of the most popular options:
- Bitcoininvestmentrex: Bitcoininvestmentrex is by far the most popular legit bitcoin investment site and one of the best cryptocurrency investment platforms because you can invest directly with USD. Bitcoininvestmentrex is the world’s most trusted bitcoin investment site that helps you to invest in bitcoin and make money securely and easily.
- Coinbase: A very popular crypto exchange that insures losses in the event of a security breach or fraudulent transfers
- Binance: Founded in 2017, Binance is a crypto exchange with a strong focus on altcoins
- Kraken: This San Francisco-based exchange allows you to invest in Bitcoin using various currencies from around the world
- Gemini: Launched in 2015 by Cameron and Tyler Winklevoss, Gemini offers services for casual and veteran Bitcoin investors with different user interfaces and fee structures for both.
- Bitfinex: The longest-running cryptocurrency exchange that’s optimized for advanced traders and lenders (unfortunately, Bitfinex doesn’t currently accept USA customers)
2. Get a Bitcoin Wallet
When you purchase a coin, it’s stored in a “wallet,” which is where all your cryptocurrency is stored. There are two types of wallets you can get: a “hot wallet” or a “cold wallet.”
A hot wallet is a wallet that’s operated by either your cryptocurrency exchange or a provider. Some exchanges will automatically provide you with a hot wallet when you open your account. In any case, hot wallets are convenient because you’ll be able to access your coins through the internet or a software program.
Some notable hot wallets are:
Electrum: Software that enables you to store your coins on your computer
Mycelium: A mobile-only app for Android and iPhone users
However, hot wallets are not the most secure form of coin storage. If the hot wallet provider is hacked, then your coin information may be at risk.
A cold wallet is the safest storage method for your coins. A cold wallet is an actual piece of hardware that stores your coins, usually, a portable device that’s similar to a flash drive. Most cold wallets cost between $60 to $100. Some popular cold wallets are:
If you’re only going to purchase small amounts of coin, then you might be fine using a hot wallet with an insured crypto exchange. But if you’re going to be trading large amounts of coin, then a cold wallet would be well worth your investment.
3. Fund your Bitcoin Wallet
Now you’re ready to purchase Bitcoin. Your cryptocurrency exchange will have everything you need to buy. The big question is, how much Bitcoin should you purchase in your wallet?
Some coins cost thousands of dollars, but exchanges often allow you to buy fractions of a single coin — your initial purchase could be as low as $25.
4. Invest your Bitcoin Order based on Minimum Bitcoin Investment
Investing in Bitcoin is very risky, and it’s important that you carefully determine your risk tolerance and review your investment strategy before you invest any Bitcoin.
With all that said, you must be ready to invest in bitcoin and make money fast, this is where you need the expertise of a trusted bitcoin investment platform like Bitcoininvestmentrex that offers minimum bitcoin investment suitable for all investors.
Most importantly, you can grow your bitcoin and crypto account into a powerhouse portfolio in under 40 days with our highly profitable crypto investing platform.
Each crypto is guaranteed to generate a monthly return between 25%-30% consistent profit, and there is an extra advantage of compounding profit on our platform.
5. Cash out or Manage your Bitcoin Investment
After you’ve invested your bitcoins with Bitcoininvestmentrex a Trusted Bitcoin Investment Platform, you wait to receive your guaranteed profit at the end of your investment period depending on the maturity of the bitcoin investment plan you choose.
In addition, you cash out your bitcoin profits once you receive them in your bitcoin wallet at the end of your investment period or you can :
- Use your coins to make online transactions
- Hold your coins for a long period in the hopes they’ll appreciate in value
- Perform day trading with your coins — that is, buying and selling coins with other Bitcoin owners, which can be facilitated on the cryptocurrency exchange
Top 10 Best Cryptocurrency to invest in 2021
With Cryptocurrency being the craze of the moment, there are numerous of them out there and the contest for whose the greatest is no doubt something to worry about for those seeking to invest in the best cryptocurrency.
From Bitcoin and Ethereum to Dogecoin and Tether, there are thousands of cryptocurrencies, which can make it overwhelming when you’re first getting started in the world of crypto as a beginner.
To help you get your compass set on the right course, these are the top 10 cryptocurrencies based on their market capitalization, or the total value of all of the coins currently in circulation.
1. Bitcoin (BTC)
- Market cap: Over $821 billion
Bitcoin is a decentralized, peer-to-peer cryptocurrency system that processes transactions through digital units of exchange called bitcoin. It was invented in 2009 by someone under the pseudonym Satoshi Nakamoto, Bitcoin (BTC) is the original cryptocurrency, and the Bitcoin network has come to dominate and even define the cryptocurrency space, spawning a legion of altcoin followers and representing for some users an alternative to government flat currencies like the U.S. dollar or the euro, or pure commodity currencies like gold or silver coins.3
As with most cryptocurrencies, BTC runs on a blockchain, or a ledger logging transactions distributed across a network of thousands of computers. Because additions to the distributed ledgers must be verified by solving a cryptographic puzzle, a process called proof of work, Bitcoin is kept secure and safe from fraudsters.
Bitcoin’s price has skyrocketed as it’s become a household name. Five years ago, you could buy a Bitcoin for about $500. As of Sept. 30, 2021, a single Bitcoin’s price was over $43,000. That’s growth of about 8,600%.
2. Ethereum (ETH)
- Market cap: Over $353 billion
Ethereum is a blockchain platform with its own cryptocurrency, called Ether (ETH) or Ethereum, and its own programming language, called Solidity.
Ethereum has also experienced tremendous growth. In just five years, its price went from about $11 to almost $3,000, increasingly more than 27,000%.
3. Tether (USDT)
- Market cap: Over $68 billion
Unlike some other forms of cryptocurrency, Tether is a stablecoin, meaning it’s backed by fiat currencies like U.S. dollars and the Euro and hypothetically keeps a value equal to one of those denominations. In theory, this means Tether’s value is supposed to be more consistent than other cryptocurrencies, and it’s favored by investors who are wary of the extreme volatility of other coins.
4. Cardano (ADA)
- Market cap: Over $67 billion
Cardano is a third-generation, decentralized proof-of-stake (PoS) blockchain platform designed to be a more efficient alternative to proof-of-work (PoW) networks. Scalability, interoperability, and sustainability on PoW networks like Ethereum are limited by the infrastructure burden of growing costs, energy use, and slow transaction times.
The Cardano platform runs on the Ouroboros consensus protocol. Ouroboros, created by Cardano in its foundation phase, is the first PoS protocol that not only was proved to be secure, but also was the first to be informed by scholarly academic research.
Charles Hoskinson, the co-founder of the proof-of-work (PoW) blockchain Ethereum, understood the implications of these challenges to blockchain networks, and began developing Cardano and its primary cryptocurrency, ada, in 2015, launching the platform and the ada token in 2017.1
Cardano’s ADA token has had relatively modest growth compared to other major crypto coins. In 2017, ADA’s price was $0.02. As of Sept. 30 2021, its price was at $2.10. This is an increase of over 10,500%.
5. Binance Coin (BNB)
- Market cap: Over $64 billion
Binance Coin is the cryptocurrency issued by Binance exchange and trades with the BNB symbol. As of June 2021, Binance Exchange is the largest cryptocurrency exchange in the world, supporting more than 1.4 million transactions per second.
Since its launch in 2017, Binance Coin has expanded past merely facilitating trades on Binance’s exchange platform. Now, it can be used for trading, payment processing or even booking travel arrangements. It can also be traded or exchanged for other forms of cryptocurrency, such as Ethereum or Bitcoin.
Its price in 2017 was just $0.10; by Sept. 30 2021, it had risen to over $382, a gain of more than 382,000%.
6. XRP (XRP)
- Market cap: Over $44 billion
Created by some of the same founders as Ripple, a digital technology and payment processing company, XRP can be used on that network to facilitate exchanges of different currency types, including fiat currencies and other major cryptocurrencies.
At the beginning of 2017, the price of XRP was $0.006. As of Sept. 30, 2021, its price reached $0.94, equal to a rise over 15,700%.
7. Solana (SOL)
- Market cap: Over $41 billion
Developed to help power decentralized finance (DeFi) uses, decentralized apps (DApps) and smart contracts, Solana runs on a unique hybrid proof-of-stake and proof-of-history mechanisms that help it process transactions quickly and securely. SOL, Solana’s native token, powers the platform.
Launched in 2020, SOL’s price started at $0.77. By August 2021, its price was almost $140, a gain of about 18,000%.
8. USD Coin (USDC)
- Market cap: Over $31 billion
Like Tether, USD Coin (USDC) is a stablecoin, meaning it’s backed by U.S. dollars and aims for a 1 USD to 1 USDC ratio. USDC is powered by Ethereum, and you can use USD Coin to complete global transactions.
9. Polkadot (DOT)
- Market cap: Over $28 billion
Cryptocurrencies may use any number of blockchains; Polkadot (and its namesake crypto) aims to integrate them by creating a cryptocurrency network that connects the various blockchains so they can work together. This integration may change how cryptocurrencies are managed and has spurred impressive growth since Polkadot’s launch in 2020. Between September 2020 and Sept. 30, 2021, its price grew 872%, from $2.93 to $25.61.
10. Dogecoin (DOGE)
- Market cap: Over $26 billion
Dogecoin has been a hot topic thanks to celebrities and billionaires like Elon Musk. Famously started as a joke in 2013, Dogecoin rapidly became a prominent cryptocurrency option, thanks to a dedicated community and creative memes. Unlike many other cryptos, such as Bitcoin, there is no limit on the number of Dogecoins that can be created, which leaves the currency susceptible to devaluation as supply increases.
Dogecoin’s price in 2017 was $0.0002. By Sept. 30, 2021, its price was at $0.20 — a 101,800% increase.