My First Step Into the World of Cryptocurrencies
With Bitcoin and Dogecoin for 50 euros, I can now call myself an investor.
For a long time, I resisted participating in the hype that Bitcoin, in particular, has triggered in recent months and years.
I never really understood the principle of the blockchain. Everything seemed far too complicated and technical to me. I’m not a nerd, and I’ve never bothered with the stock market either.
And yet, the day before yesterday, I invested my first fifty euros in cryptocurrencies. I’m still not sure if I should really call it investing, though. The term gambling still seems more appropriate to me.
I split the money between two crypto currencies. Actually, I wanted to buy equal parts of Bitcoin, Dogecoin, and Cardano, but I didn’t manage to do that. More about the reason for that later.
Why Bitcoin and Dogecoin?
Since I have absolutely no idea about the crypto market, Bitcoin seemed the most obvious to me at first. Everyone and their dog has Bitcoins, so I should have some too. What made this decision easier for me was that bitcoin had just plummeted significantly at the time. So I could convince myself that I was making a smart move by buying cheap to take advantage of a new surge later.
I chose Dogecoin for two reasons. First, the currency had risen over 2000% since December 2020, and second, it is a meme-based fun currency.
The insane price rise from under $0.02 to over $0.08 at times has now come to an end, and one Dogecoin is currently still worth about $0.056 (as of February 25, 2021, morning in Germany). However, the Doge has stabilized at a very high level instead of immediately plummeting to below $0.02 again.
For the fact that Doge was supposed to be a satire on bitcoin, this coin is doing very well. I like underdogs, which is why I bought the Doge.
Is that what it’s called? Or do I need to say, broker? I still can’t figure out the terms. But okay — I’m talking about the place where I buy and trade my cryptocurrency.
I’ve decided to use Binance. Others swear by Robinhood, but I found too much negative publicity about it in my research, which is why I kept my hands off this app.
You can tell — I didn’t put a lot of effort into the research. I just needed a starting point from which to begin my exploration of the cryptocurrency world.
Can I recommend Binance? I’m not sure. So far, I have not managed to go through the authentication process. I can currently buy and transfer coins, but any advanced features (no idea what exactly) I won’t be able to use until I manage to complete that damn identification process.
There may also be brokers (or marketplaces, or whatever) out there that would be better for me. If so, I’m not interested for now. Hey, I’m playing with a lousy 50 euros for now to get the basics down, so no stress.
Why I don’t own Cardano-coins yet
Because I’m too stupid to understand Binance. I thought it would be smart first to fund my account at Binance with Euros and then use that balance to buy cryptocurrency. Well, as long as you want to buy bitcoins, you actually can.
All other cryptocurrencies, however, I can only pay by credit card or direct debit, but not with my Binance balance (don’t nail me down on this. Maybe I’m just not smart enough to figure out how to do it).
But I only wanted to invest fifty euros, which I had already done by topping up my Binance balance.
So the only thing left for me to do was buy Bitcoins, or rather, to exchange them. The Binance credit is exchanged for Bitcoin. For some reason, I was able to buy Dogecoin with my Euros too. I guess this is based on a test purchase of some Doge I had made the day before. You can apparently exchange credits for cryptocurrencies that you’ve already purchased in the usual way.
How it’s going for me so far
I have had 51 euros debited from my bank account to have at least 50 euros to trade after deducting the fees.
From the 50 Euros, I invested 16 Euros in Doge and 34 Euros in Bitcoin.
As I write this article, the value of my portfolio is at 55,21€.
So within two days, I have earned a little more than a 10% return. Of course, this can look completely different again in half an hour, but so far, my attempt has at least not become a total disaster.
What happens next?
As I learned from wise people on Reddit, there is really only one option: HODL!
HODL stands for “hold on for dear life” and means that you should not sell your coins under any circumstances but wait until they become worth more and more. This is exactly what I will do with my coins.
Maybe I will buy cheap again, as soon as there is a new price correction. However, I will only use money that I can do without.
So in the next few months, I will mainly watch the market passively and see what becomes of my “investment.” I will certainly not make a fortune, but that’s not what I’m about now.
I’m just learning something new, and for that alone, it was worth entering the world of cryptocurrencies.
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