3 Rules for Investing in Cryptocurrency
Are you interested in investing in cryptocurrency? Here are some rules to ensure that you know when and how to invest in cryptocurrency properly.
Cryptocurrency is the new darling of investments. Since the middle of 2013, The market cap has increased by 10,000%. These shocking increases have made many investors believe that cryptocurrency exists in a bubble that will eventually pop and disappear. However, since the creation of Bitcoin in 2008, cryptocurrency prices have increased significantly. One expert believes that one Bitcoin token will sell for $20,000 by 2020, which is three short years away. This doesn’t mean that cryptocurrencies aren’t a highly volatile investment. It isn’t fully regulated and is a very young investment class. The potential for losing a great deal of money is there, whether it’s from them being outlawed, losing your cryptocurrency key, etc. Conversely, there is the opportunity to make a fortune by investing in cryptocurrency. It’s a high risk/high reward venture. If you are willing to invest in something that isn’t consistent and won’t be for some time, then cryptocurrency may be for you.
Rule #1: Check Coin Market Cap Before You Buy
Coinmarketcap.com is the best place to see all the current market caps of all types of tokens. Up until the end of 2016, cryptocurrency and Bitcoin were synonymous. There were no other options. Now there are upwards of twenty tokens available, with more on the way. Smart investors will have a balanced portfolio with some of the top-level tokens represented. Coin Market Cap is the best place to see them all and decide which are best for your needs.
Rule #2: Choose Your Investment Strategy
There are several options for investing in cryptocurrency. Researching these different availabilities will ensure you have a smart investment.
● Buy directly through exchanges.
○ If you want to avoid the potentially high fees for investment products, you can start buying cryptocurrency directly. There are several exchanges available in each area of the world.
○ Here is a list of the U.S. exchanges:
■ CoinBase
■ BitFinex
■ BitStamp
■ Gemini
○ These exchanges are compared thoroughly on the website Crypto Compare, so you can make the best decision.
● Crowdfunding Platforms
○ When cryptocurrency startups are just beginning, they often use crowdfunding platforms to get off the ground. These are great places to get started with cryptocurrency without spending a ton of money.
○ A platform called BnkToTheFuture lets people invest in several Bitcoin and blockchain startups.
● Initial Coin Offerings (ICOs)
○ ICOs are how many startups fund their operations. They are often sold for fractions of a penny, saving an investor a great deal of money, while giving the opportunity to get a huge return.
○ They aren’t very regulated because it is a new type of crowdfunding.
○ Research the companies before investing. Check out their websites, LinkedIn profiles, or Twitter feed to get a feel for their level of knowledge and professionalism.
○ Find a trustworthy startup and jump in on their launch. TwoGap is a new startup that will be offering their token in December 2017. Their decentralized value management platform is the first of its kind, and worth investigating.
Rule #3: Buy at a Good Time
There is no hard and fast rule for when to invest in cryptocurrency. The best option is to avoid investing when the bubble is peaked or when it is crashing. Find a cryptocurrency with a steady/low price and watch it for a few weeks. If it hangs on with little change, it is probably alright to invest. Research is the best way to try and predict whether the currency is in a bubble or falling. Cryptocurrency is a volatile investment, so this can be challenging.
You may want to consider a decentralized asset management platform to manage your investment. TwoGap is at the forefront of the cryptocurrency trend. Their platform has all the modern components you need to complete transactions using blockchain technology. For more information about TwoGap and their benefits, visit their website, blog, forum or join their community.
