5 Things to Consider Before Investing in Cryptocurrency

The ride is going to be quite a rough rollercoaster ride. It’s very common to see drastic highs and drastic lows in the crypto market. You may even have a lot of sleepless nights if too much is at stake. You will lose your mind over how to enhance the ROI. Certainly, nobody wants to see their hard earned money get vanished in thin air.

Despite of all of this, people are investing and thriving. BUT HOW? The answer lies within this article. We have curated a list of things to know before putting money in cryptocurrency as an investment.

• How much money are you willing to invest?

The market is supremely volatile in nature. One has to constantly speculate the market following basic rule of economics “demand and supply”. And while higher-risk investments can generate high returns, one should only ever invest what one can afford to lose. It is imperative to keep expectations real. Like any investment, don’t pour your life savings into one transaction. To play safe: Invest only as much as you are willing to lose.

• Investing in cryptocurrency is NOT a retirement plan.

Let’s get this straight that investing in cryptocurrency is not secure. The nature of market is very dynamic. Bitcoin may go as low as $200 any instant, and may even go as high as $10,000. But one needs a retirement plan on which they can bank upon. That being said, do not invest in cryptocurrency in such a way that your life depends on it. It’s not safe. One must have a backup.

• Cryptonomics for the win! READ. READ. READ.

Investing in cryptocurrency is not entirely a gamble. Speculations based on current affairs in the cryptoworld have to be taken into account to win at investing. It’s not just a matter of chance. One also needs to know when to withdraw or when to chip in. This wisdom comes with experience, and also with some theoretical cryptonomical knowledge. Stay abreast with the crypto charts, read about news, regulatory laws in different parts of the world to stay up to date.

• Avoid fishy schemes.

Do not fall into the trap of fishy ICOs or ponzi schemes which guarantee some kind of ROI. Such scams are on a rise these days. Scammers are prowling for people who are not-so-aware about the whole concept of crypto and eventually make a fool out of them. Do not trust anyone with your crypto, keep it safe in your wallet.

• Crypto ≠ Fiat (Until you convert it).

Majorly crypto is not yet a unit of exchange. One can’t buy coffee with bitcoin. It’s like buying chocolate with gold. One has to convert gold into fiat currency first and then only one can buy chocolate. Likewise, one has to convert the crypto into suitable fiat currency to use crypto as a unit of exchange. Presently it is only a store of value. This can be done with the help of your country’s crypto exchange.

Lastly, be responsible with newly earned rewards. The money can go away as easily as it comes. Be a vigilant investor who knows what they are putting their money into. Have a planned strategy and stick to it. Make sure to plan your strategy for the times to deal with loss as well so that vision is not blurred by depression.

Happy investing!