Guide to Choose Cryptocurrencies for a New and Novice Investor
“Crypto industry is the most volatile industry in the world and thus, it is extremely important to know how to swim into these unchartered waters before you go diving.”
Why Is It Important to Understand First and Then Buy?
Crypto industry is the world’s fastest industry in terms of adoption. From the beginning of its journey almost a decade ago, it has reached a market cap of over 2 trillion which has been seen by no other industry till date. Past 2 years have been extremely bullish for the crypto industry which has led new and novice retail investors to invest blindly in the market.
Crypto industry is the most volatile industry in the world and thus, it is extremely important to know how to swim into these unchartered waters before you go diving. As many have sunk without even a chance to float and if you want to prevent such an event you must choose your first cryptocurrencies wisely. Here is a basic guide for crypto investors that are new to the crypto arena.
Things to Keep in Mind
Invest in the Trustworthy
Bitcoin is the most trustworthy cryptocurrency of all as it has been in these waters for the longest and is the currency of highest value. It has grown over 800,000% from its inception to an all time high of $67,900 per BTC. All the institutional investors are accumulating it and have termed it as a future store of value. This means that over the long term its value will appreciate and thus every new investor must own some BTC, at least some satoshis as 1 BTC is out of the range of almost all the retail investors.
Research and Then Buy
Always perform an extensive research on the coins you intend to buy before buying. As research leads to identifying the utility of the currency and the current progress that it is making, it will help in predicting the price in the future and a better investment decision can be taken.
Always Try to Invest in the Large Cap Currencies
All the first 30 cryptocurrencies are there for a reason on the top charts. They are the ones who have reached the top spot against the test of time and hence you must sail the boat with these top 30 currencies to ensure capital appreciation and reduce the risks of volatility.
Identify the Scams
Everyday a large number of cryptocurrencies are being launched and it becomes extremely important to identify which currencies are legit and which will devoid you of your money. New ICOs and IPOs must be avoided until proper information is provided by the crypto team. There are a lot of red flags that you must look for in such new companies and if found must be as far away as possible from them.
Have a long Term Perspective and an Exit Strategy
Invest for the long term in the cryptocurrencies and will see the power of growth it has to offer. You must have a long term goal before investing so that you keep hodling until the goal has been achieved. Also, there must be in place a well defined exit strategy so that profits can be reaped whenever they are achieved as markets are volatile and the earned profits can vanish in a jiffy.
Disclaimer: The article should not be considered as any financial advice. It is advisable to conduct thorough research before investmen
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