Chapter 8: Tips for Growing Your Crypto
If you’ve stepped foot into the world of crypto, you recognize many of the benefits — both current and potential — of this form of currency. So let’s see two of these benefits.
Firstly, there is its anonymity in a world with an increasing lack of privacy (that can often threaten our financial security). A second benefit is its relative guaranteed security as a form of currency that‘s proven to hold fast against world politics and other factors.
These benefits make crypto trading easier and less worrisome, especially for beginners. In this Crypto Fundamentals chapter, we’ll explore a few ways in which you can take your trading to another level and grow your crypto. So let’s get started.
1. Use technical analysis (as opposed to fundamental analysis)
The field of economics has several useful models that help to make wise investment decisions and predict the future state of markets based on various indicators. One such model is called fundamental analysis. It is a macro-outlook that “studies both economic and financial factors to determine if the value of an asset is fair”. This helps investors make decisions based on this determined value. However, because this model relies on real-world or tangible factors, it’s not ideal for the virtual world of cryptocurrency.
As opposed to fundamental analysis, a more suitable way to do just this is through technical analysis. An easy way to understand technical analysis is, instead of trying to calculate the value of an asset itself, it traces the history of the trading activity around that asset, and then makes future predictions based on this history.
It’s equivalent to not judging a book by its cover, and instead, reading it entirely before making any judgments! This is a helpful tool when investing in various forms of cryptocurrency — try to get a sense of their past trading activity. While the markets do fluctuate, some well-known contenders are trusted, and these are the ones you want to follow.
Just as with traditional forms of investing, one of the ways to grow your crypto is by making wise financial investments into various types of crypto, such as Bitcoin or Ethereum. IXFI puts an extensive and ever-growing list at your disposal.
It is important to not limit yourself to one type of cryptocurrency, as it is volatile by nature and continuously changing. Therefore, try to diversify your interests and investments as a way to counterbalance the risks present in the world of crypto.
2. Follow relevant news and market trends
It is common knowledge that Elon Musk’s recent tweets about Bitcoin had immediate and stark effects on cryptocurrency. This is just one example. The world of crypto is highly dependent on the people who have some type of interest or investment in it — even those who don’t recognize the potential power crypto holds. Because of this, crypto is subject to the rise and fall of opinions, the media, market trends, popular social figures, government interests and even memes, to name just a few.
Cryptocurrency, while decentralized, is mouldable by the people who inhabit the spaces it exists in. Therefore, when growing your crypto, it is helpful to stay ahead of the current news, popular opinions and market trends that surround the cryptocurrencies you are interested in. Doing this will allow you to have some foresight and insight into how the real world might affect the virtual world.
3. Be aware of scams
While this may not be a direct way to grow your crypto, investing in the somewhat new cryptocurrency sphere means that you want to ensure you minimize any potential risks.
There have been cases of scams and hacks in countries like South Africa, South Korea, the US and the UK. Scams can show up in the form of imposter websites, applications, ads, emails, and even fake posts on social media.
Always operate and transact through trusted and established crypto sites. Business Insider outlines some common and complicated crypto scams that anyone can fall victim to — familiarize yourself with these potential risks to ensure that the crypto you grow does not go to waste.
You can rest assured though, as crypto runs on blockchain technology, it is already one of the most secure ways to participate in financial exchanges, investments, and trading. It is good to have a sense of caution while remaining optimistic with your investment or trading appetite.
4. Become a Bitcoin miner
Cryptocurrency, and Bitcoin, in particular, is a system that feeds itself by rewarding those who maintain or add to the blockchain technology calculations with opportunities to gain more crypto. (Blockchain technology is the “cryptography” part of crypto and what keeps the system safe, secure, and private.)
This process is what Bitcoin mining is and is just one of the many ways that will allow you to grow your crypto. If you can get the software and hardware needed to mine Bitcoin (and especially if you live in a cooler climate), this is a sure-fire way to grow your crypto stably and consistently.
Finally, with all these healthy tips in mind, you should now be more equipped to grow your crypto. IXFI, Your Trusty Crypto Exchange is here to help you on your journey, so don’t hesitate to register and try our features for yourself.