Cryptocurrency is getting popular across the globe and many investors are looking to make handsome profits on its white-hot rise. Cryptos including Bitcoin (BTC) and Ethereum (ETH) have come a long way and their value has increased manifold.
But are you aware of crypto volatility?
Here comes the most important part since as a beginner you might end up losing everything in the crypto business. Experts believe that when you decide to invest in cryptocurrency, there are some keys to success.
And as an investor, you should hold all the keys to unlock every door that stands in the way.
Let us find out what you should know as a crypto investor.
What is Cryptocurrency?
As a crypto investor, you should start crypto investment by understanding how cryptocurrencies work.
Cryptocurrencies can be defined as digital or virtual currencies that are supported by blockchain technology. These are decentralized currencies which operate free from the influence of any bank or government.
To ensure enhanced safety of investors, cryptocurrencies are protected by cryptography which consists of difficult mathematical equations that are hard to break. Furthermore, the security of a cryptocurrency is determined by its hash rate, the higher the hash rate, the more secure the digital currency.
You can buy cryptocurrency through a crypto exchange where multiple digital currencies are traded simultaneously. In addition, there are other ways to enter the crypto business too such as the NFTs, etc.
Cryptocurrencies offer you multiple benefits such as the freedom from a bank and more. You can make a crypto transaction at any time anywhere across the globe, thanks to its 24/7 availability.
Carl Runefelt, alias, The Moon, is a global crypto leader who has invested in more than 350 crypto startups.
He says, “I am very confident that this will be a very good investment. I believe that Bitcoin is not only going to go to $500,000, I think that Bitcoin is gonna go to five million dollars per Bitcoin in today’s money. Obviously, with inflation, bitcoin could go to trillions of dollars per Bitcoin. Actually, it will because it is inevitable, but because the dollar will collapse at some point, that’s just something that is going to happen because it’s inevitable, but I believe that in today’s money, Bitcoin could go to five million dollars.”
Invest Wisely
Once you build your knowledge about cryptocurrencies, the next thing you should focus on is investing wisely.
The crypto business is booming, and it can easily lure someone to make huge investments. But you should be careful about your investment since savings are important too.
As a beginner, you should invest in a cryptocurrency that you can easily afford to lose. This is crucial because cryptocurrencies are volatile, and their values can fluctuate at any time.
For example, BTC was valued at around $60,000 in 2021, but its current value is around $20,609 (as of November 2022).
Carefully Observe Volatility
Cryptocurrencies are decentralized currencies which means they operate free from any bank or government regulations. This can lead to serious challenges in the crypto business if you don’t pay attention.
Volatility is a word that is often related to cryptocurrency. But you can turn crypto volatility in your favor through an eager observation.
Carl, on his YouTube channel, The Moon, says, “Bitcoin is a game of patience. You cannot look at the daily chart and put too much significance on it. Holding long-term will make you money in Bitcoin and crypto in general. If you look at the day-to-day or minute-to-minute, it can look very volatile; you see 50 jumps and then 60 dumps. People get fearful and panic, but always remember if you zoom out on the Bitcoin, you will always see a bull trend on Bitcoin.”
Before you start investing in cryptocurrency, you should do comprehensive market research by analyzing the current trade chart of the digital currency you want to buy. You should avoid market sentiments as they often lead to losses than benefits.
Lastly, you should remember that cryptocurrency is a game of patience. You should hold on to the digital currency you buy for the longer term and trade it when it hits the maximum value.
Conclusion
You can find many investors talking enthusiastically about investing in cryptocurrency but without any planning.
Successful crypto investors first do homework to build the right crypto investment strategy and then trade cryptocurrencies timely.
You can follow the above-mentioned tips to start investing in cryptocurrency and make nice profits.
