Cryptocurrencies are the immutable and the exchangeable form of cryptographic tokens. This form of exchange is non-manipulatable. There are various reasons why one would like to invest in cryptocurrencies. First, is because want to avoid being affected directly by the fall of the regular currencies. This is to maintain their net worth. Another reason to invest is if a person completely understands how technology is set up and how it works. A person may also decide to invest to support the social goal or vision that the developers wanted to achieve with cryptocurrency.
However, some people make the mistake of investing for the wrong reason. They may decide to do it just because others are doing it and they don’t want to miss out on the profits. Failure to research and have information about the investments may lead to mistakes and finally loss of life savings.
Best places to invest in cryptocurrency
The first step on how to invest in cryptocurrency is to know the best places to invest.
PrimeXBT
This is an investment platform that provides a lot of different crypto-assets. Examples of such assets are Bitcoin, Ethereum, EOS, and Litecoin among others. This platform also acts as a bridge between cryptocurrency and trading. Here, investors are exposed to various strategies of investments. The platform is also efficient because it has very low trading fees compared to others.
eToro
This is a social platform for trading purposes which originally began as a platform that dealt with forex and stocks. Later on, they incorporated cryptocurrencies into their systems. This platform offers a very efficient user interface because of the simple steps one has to go through to get started. After creating an account, the platform offers easy payment methods and one can start trading. They have cryptocurrencies such as Bitcoin, Dash, Ethereum, Cardano and bitcoin cash among others.
LocalBitcoins.com
This is a platform that allows investors to meet buyers and connect, either online or offline or even a combination of both. Investors can also meet brokers, execute their dealings and come up with solutions on amounts and the methods of receiving payments.
How to start investing in cryptocurrencies?
A start-up plan is a major step on how to invest in cryptocurrencies. Some people may put off this method of investment because they have the idea that a lot of money is required to get started on cryptocurrencies. To get started, one should learn to save up and have the patience required to start small. People willing to invest should also do a lot of research and make sure they have the necessary information and knowledge of cryptocurrencies.
Potential investors should first of all select the perfect place to invest that fits their individual needs. Some of the factors to be considered are the benefits offered and the ease of operation. The platforms should also be user-friendly and offer direct interaction between investors and brokers when necessary.
To start, investors should also know how to store and transfer cryptocurrency. There are two types of cryptocurrency wallets, hardware and software wallets. Hardware wallets are devices that run the software and can be plugged into computers and allow for transfers to take place. The user is in full control of this device. The other wallet is the software wallet which is programs that allow the user to create accounts and transfer cryptos. They are easy to access and are very suitable for active trading.
Investors should also familiarize themselves with the legal restrictions put in place, the security, and the credibility of what they are doing to be able to start well.
How to choose the best cryptocurrency to use?
Choosing the best cryptocurrency is very vital in such a type of investment. There are various factors to consider when choosing. First, one should choose one which has high liquidity.
Liquidity is the ease of either buying or selling in the product market. High liquidity ensures fast transfer and better prices on the products. Investors should also choose a cryptocurrency that allows for easy transactions. One should be able to deposit money easily and also easily convert money from personal accounts to bitcoins to facilitate the investment. One should also consider security when choosing. There should be services such as cold storage where the currency is safely hidden from hackers. Verification should also be incorporated to restrict access to the user only.
Another factor to consider is trading fee rates. One should choose a currency that has favorable trading fees to maximize the average profits. The ease of use should also be considered when choosing.
Good choices after such considerations are vital on how to invest in cryptocurrency.
Difference between investing and trading
To learn how to invest in crypto currency, an investor should know how to differentiate between investing and trading in crypto currency. These two are the pillars of crypto markets. Investing in crypto currency is the buying and selling of cryptocurrency, with such deals lasting for a long period. Trading is similar to investing, but the sole purpose of traders is to open and close deals on trades. The difference between these two is that in trading, the period is shorter than in investment. The creation of trades by traders is much higher in cryptocurrency trading is much higher than in investing. This information is also very key in how to invest in cryptocurrency.
