Investing in cryptocurrency

Cryptocurrency is the most popular investment asset and one of the most talked about topics in the world.

China introduces a ban on cryptocurrency, hackers use BTC and Tether for extortion, and of course - a bunch of stories about millionaires who invested in Bitcoin in 2009.

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The internet coin industry is all over the place and it's no surprise that novice traders are opting for digital currencies over the stock / forex / futures markets.

Cryptocurrency - reliability or HYIP?

First, there is nothing reliable about trading. No trading system guarantees 100% profit, and it would seem that positive news regarding Bitcoin can be “ignored” or misunderstood by the market, which will lead to a fall in the price of BTC.

This is, of course, not a call to play at random, buying any cryptocurrency you like, expecting a price increase with your fingers crossed. This approach always leads to bankruptcy. When investing, you need to analyze EVERYTHING and first of all - the chosen industry.

Disputes about digital currency have not subsided since its inception, but it is safe to say that cryptocurrency will hold out for a long time, even if it is “the most ordinary financial pyramid of global proportions,” as the conspiracy theorists say.

Many world-class corporations and funds have invested in cryptocurrency and created large-scale, expensive services for storing / transferring / speculating with it.

Whole states create national digital currencies (digital yuan / ruble). True, state cryptocurrencies are deprived of anonymity ...

Large players are not afraid to invest their time, effort and money in cryptocurrency for a long time, why should we be afraid to sit in a position for a week?

Large players are not afraid to invest their time, effort and money in cryptocurrency for a long time, why should we be afraid to sit in a position for a week?

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Volatility

Volatility or price range - the average price movement over a certain period. Thus, an asset with high volatility is considered more dangerous, because it can quickly make you both fabulously rich and fabulously poor.

Cryptocurrency is considered the most volatile asset for a reason. Take BTC, which shocked the whole world, reaching a value of almost $ 20,000 per token in 2017, although it started with a couple of cents. After BTC fell again, then rose to a record $ 64,000 per token. Then it fell again, already below $ 30,000, but now it is growing again (it seems) ...

This applies to both Bitcoin and other cryptocurrencies. There are stable samples among them, but Bitcoin serves as a market index and after the fall of the first token, the entire market falls. Therefore, cryptocurrency is rightfully considered the most volatile sector.

Good or bad - you decide.

Trading approach

The management of any company on the stock market is obliged to publish the most detailed reports on its fundamental indicators (debt, profit, dividend payments). You need to report on the sale / purchase of shares of your own company and many other actions.

The reporting is carefully checked by the regulator, and if the information provided does not correspond to the present state of affairs / confuses the reader, severe punishment will follow.

The cryptocurrency lacks fundamental indicators and large-scale financial reports due to the absence of a regulatory body, such as the American SEC, obliging the company to write reports.

A distinctive feature of cryptocurrency is freedom and, most importantly, anonymity, which digital currency and its investors use successfully.

By the way, anonymity in cryptocurrencies is gradually decreasing. Recently, the US government announced the return of millions of dollars stolen by a group of hackers. The government managed to hack the Bitcoin wallets of criminals, which scared to death those who kept money in BTC, piously believing in the invulnerability of their assets.

On the one hand, this is certainly bad, but the less anonymity, the more willingly the cryptocurrency will be officially accepted and the sooner you can pay with Bitcoin for a cup of coffee.

This is not an unambiguously bad feature of cryptocurrency. Firstly, you don't need to study for a long time, and secondly, maybe someone will like to build their strategy not on specific numbers, but on collecting and analyzing rumors / news with a free interpretation.

This approach assumes more creative than mathematical thinking and will appeal to people with a humanitarian mindset or just those who like to read the news.

Cryptocurrency platforms

This is a vast topic and a separate article will be written for its full disclosure. Let's consider only the most basic criteria.

Choosing a broker is a difficult task both in the stock market and forex, but according to statistics, cryptocurrency brokers are the most distrustful. In vain! Cheated with the same chance as in other markets.

Do not want to be deceived - observe the following points when choosing a broker (applies to all markets).

  • Broker fame. Take for example Binance is one of the most famous cryptocurrency platforms that has been in operation for a long time and holds official licenses for legitimate activities.
  • Licenses. As follows from the first point, a cryptocurrency exchange may be licensed. Firstly, this is an indicator that the cryptocurrency is more and more recognized as a real asset, and secondly, consider ONLY brokers with a license. This is an additional guarantee and it is foolish to ignore it.
  • Publicity. Back to Binance , whose CEO does not hide her face and name. Agree, the likelihood that a public company will suddenly take all the depositors' money and hide at least below.

Don't have time to read a separate article on choosing a cryptocurrency broker? In addition to Binance , we recommend taking a closer look at Coinbase where the above applies.

This is in terms of reliability, but there are many more options for choosing a cryptocurrency broker, ranging from the size of the platform's commission to its interface.

Select cryptocurrency

As in the case of choosing a broker, a separate article is needed here. Let's take a quick look at the topic.

The first thing that comes to mind when we talk about cryptocurrency is Bitcoin. Its popularity has led to the misconception that the entire cryptocurrency market is a rollercoaster with billions of dollars in volatility per day.

Yes, above we have established that the cryptocurrency market is really very volatile, but there are more calm assets.

There will be digital currencies for every taste, starting from Bitcoin, which is only a currency, or its rival - Ethereum, which modernized some aspects of BTC and created a whole platform for the development of IT projects.

There are cryptocurrencies tied to recognized national currencies that are more stable and better suited as a savings asset, unlike their counterparts, whose value jumps like a kangaroo on a trampoline.

“Comic” cryptocurrencies that bring serious profits (and losses). Dogecoin is a cryptocurrency whose ambassador is a funny dog.

Dogecoin, despite its frivolity, took part in a price rally, largely thanks to the controversial billionaire Elon Musk.

“DOGE” - This word, written by Musk on his Twitter account, led to the growth of cryptocurrency by hundreds of percent and the subsequent public excitement. Later, Musk completely forgot, calling Dogecoin "the people's cryptocurrency" and launching several memes on this topic, after which the "dog token" grew even more.

By the way, Musk is the unofficial ruler of cryptocurrency and it is recommended to closely monitor his statements. One word from him and now, the bitcoin you recently bought has already dropped in price by 300%.

Musk's statements angered the Anonymous hacker group, which promised to teach the billionaire a lesson for barbaric manipulation of the cryptocurrency market.

While Elon is not hacked, manage to fly into the “hype wave” that he periodically creates. If you respond to his messages in time, you can make very good money.

Sounds like gibberish, right? The above looks like a silly joke. Is there a place for such nonsense in the field of big money, in the field of investments and serious investors in business suits? Is this what you expected to see in a business article about investing in the most advanced financial arena ?!

Get used to it, the entire cryptocurrency market is saturated with such events, and if you want to stay in it, adapt.

News is a key engine of cryptocurrencies and they affect different cryptocurrencies in different ways. It makes more sense to focus on one cryptocurrency by examining what affects its price the most.

News of the environmental harm of cryptocurrencies, for example, is likely to lead to a drop in the price of Bitcoin, as its mining releases a huge amount of carbon, while Ethereum will suffer less.

In the end, it is better to become a professional in a narrow field than an amateur in everything.

Conclusion

Investing in cryptocurrency is dangerous, as well as everything connected with money, from investments to saving money in a bank or under a mattress (inflation does not sleep).

The cryptocurrency market is different from other markets, it is dominated by the analysis of news outlets and intuition. Do you consider yourself a humanitarian, but want to become an investor? You are here.

There are proven and reliable platforms for cryptocurrency transactions, trustworthy no less than eminent brokers in any field.

Weak regulation of cryptocurrencies can lead to the emergence of one-day tokens that disappear with the money of gullible investors, but this happens in the stock market, and often.

It turns out that investing in cryptocurrency is not that much different from the stock market or forex that is familiar to many. Each market has its own nuances, but the principle of earning is always the same - buy cheaper and sell more expensive.

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