Getting Started with Crypto – Ideal Tips
Are you new to the field? Learn how to use crypto and sleep soundly at night.
You are thinking of taking the step into the vast world of cryptocurrencies. Have you heard a few comrades talk about it, have you searched a little and discovered that buying digital currencies is not as easy as the alphabet and 123? In fact, with more than 10. 000 project, it’s actually quite complicated. BUT are you still intrigued by the industry and do you think you want to keep engaged?
Start using Crypto with confidence knowing what to do and what to avoid
Before we start on what to do, here’s a quick rundown of things on a list we should avoid in this article:
- Do not buy or sell frivolously based on volatility. When the markets are ready to move, your cryptocurrency doesn’t necessarily mean it will do the same.
- Instead of paying too much attention to speculation and “specific” price predictions, focus on a project’s fundamental and other key metrics.
- Avoid following TikTok and Insta-influencers without checking their credentials. Trust does not equate to market insight.
- Do not buy what you cannot afford to lose soon, and certainly do not be charged to invest in a project. It is risky behavior and can get you into trouble.
Okay, this is a quick lesson in what you shouldn’t do. Here’s what crypto behavior is worth practicing when you start using crypto:
Do your own research (DYOR)
This is the most important thing when you start dealing with crypto: when you find a project that interests you, take a big look at it before investing your money on it. Do your own research on the key details and take a look at important things like:
- The team, the founders and the key investors behind the project and have an insight into their reputation. If there is or shows something not so legal, you should be careful.
- The use that a project can have. If there is an obvious and practical function, there is a better chance of a healthy future than if the main marketing strategy of a project is money making and profit.
- Read reviews and consult the community response to a project. The cryptocurrency community (especially those who have been on the scene for quite some time to know what’s what) will be able to offer information about a project and whether it’s worth your time and money.
No to FOMO and no to YOLO – average cost strategy of one dollar
Spending a lump sum on a cryptocurrency because everyone else does it (the classic “fear of missing out” strategy) or logging in when the price of a project goes up can be tempting, but it’s actually not the best thing to do. Most often, the market is corrected, and if you enter too aggressively, you risk losing large funds.
Instead of following the herd and buying in the hype (literally), opt for a more secure strategy that will help you accumulate increases over time. The average cost of a dollar (aka DCA) is a safer strategy where you invest the same total amount of money, but over time and not all at once. In this way, you can enjoy small wins without risking your money in one go.
Don’t put all your money into a single project
There is a debate between concentrating your attention on a single currency versus diversifying your funds into cryptocurrencies. Some argue that concentrating on a cryptocurrency to maximize the potential profits you can make from the coin, but there is a very significant drawback behind this approach: It maximizes risk exposure if this task fails.
Instead of focusing all your attention on a cryptocurrency, prefer to have a fair choice after some serious research. It’s kind of like the Goldilocks approach: Find the sweet zone between overconcentration and over-differentiation. This way, if a project underperforms, your entire crypto portfolio won’t go down much.
Store your Crypto securely
One of the biggest problems we’ve seen from new cryptos lies in the risk of storing cryptos. Remember, the security of your cryptocurrencies lies in the security of your storage space. In the same way that your bank card or cash is stored in a physical wallet, your cryptocurrency is stored in a but digital-style wallet.
This can be either online (known as “hot”) or offline (called “cold”). Storage in a cold wallet, it can happen for example with a Ledger wallet, is not connected to the internet and is less at risk of being compromised. If you manage your wallet well, your cryptos run less risk and have the best chances.
Start using crypto, encourage space, and learn along the way
If you are really curious to approach the site, the best way to find out is to do research around it. Make sure you are aware of the risks, avoid unnecessary threats, and be careful where you put your trust and money.
Remember, the market is full of opportunities and possibilities! Step in slowly and explore with enough attention. The more you learn, the more you’ll see how exciting this space is!