Before you spend your hard-earned money, create your own investment strategy.
Think about it how much time you have to take care of your investment, how long you can freeze your capital, what a huge risk you want to take, what your stock investing skills and experience are market.
The article is part of free practice - Cryptocurrencies - how to get started and live? A course for everyone!
Why invest in cryptocurrencies?
Conversations, dreams and hypocrisy
Many people who invest in cryptocurrencies do not understand them, less technology stands behind them.
They just want to earn fast.
Most often they have a gambling line and are willing to risk a lot because they see the opportunity to get rich big.
They have no strategy and they act that way if they buy a lottery ticket.
they often listen to beatersino They promise them huge income without informing you about the risk of losing capital.
They shout that the value of Bitcoin will one day reach USD 1 million and make them rich.
The whole driven by dreams of easy achievement and a graph of historical quotes bitcoin, Ethereum or XRP, that made people in the past invested in them long-term, rich.
They call their viewers long-term breeding, regardless of the current price and market situation.
They show that many years ago the price of bitcoin ranged from $ 10 to $ 2 and you had to keep bitcoin in your safe wallet, whatever it was, to arrive at times worth a few thousand per item.
Often, they offer their viewers pay for training and purchase products and services for which they themselves draw commission. It so happens that these youtubers have not yet earned a penny of investing in cryptocurrencies, and they are living in the primary frustration with their recipients.
Under the slogan "invest in cryptocurrencies" you will also find a whole lot of financial pyramids, scams and psaudo-investment funds that promise a monthly income of many percent.
Be careful not to get caught!
A big plus of investing in cryptocurrencies is the ability to do it yourself and directly.
We do not need the middlemen and the management of our capital. We must do it ourselves.
So how to invest in cryptocurrencies?
Investing in the future
We do not know if history will repeat itself and if we buy bitcoin now, when everyone hears about it, we will get it.
Perhaps it is better to look for a project that no one knows yet, how about bitcoin ten years ago, and so promising and well planned that it is strong in the future?
might it be better to invest only in the largest, oldest, proven cryptocurrencies with the largest capitalization, which in the future may want to invest institutional capital, creating digital gold from bitcoin, raising its price to new maxima? No one knows the future. If anyone knew him, he could easily become the richest in the world.
Eventually, cryptocurrencies were bought to pay for them, as money was not in the banking system and government regulation. There have been very few such idealistic investors today because bitcoin i altcoiny they have become mainly today asset theory, something like stock exchange shares.
Some investors treat cryptocurrencies as investing in new technologies, new economies, as well as technological startups can become a big and profitable company in a day. It is possible that it was born in this market or it is the second Amazon. Such assumptions are supported by the comparison of the current, still early stages of development of the blockchain industry, as well as the great boom to invest in kryptowaluty of late and early 2017 2018 year to dot-com bubble, which which was created at an early stage of internet development. It was after the explosion of the bubble theory that even the weakest projects achieved huge valuations, companies now with global corporations like Facebook and Google are at the forefront.
In today’s economic model, it may not matter that tokens have little relevance to the project, they do not guarantee anything to investors and their valuation is often separate from the foundations if the shares of the companies are of high value that at least 100 will have to wait for the profits of a given company to achieve its stock capitalization. In this sense, the contractual linkage of cryptocurrency and the project it emits is not a problem.
The speculation in the cryptocurrency market
The basis of a given asset has nothing to do with stock market speculation. It does not matter to him what the asset is - whether he is buying and selling bitcoin, litecoin, PKN Orlen shares, ETF for gold or pig! All that matters is the price change. The main tool of his work is its chart and analysis, as well as market mood survey in the context of expected events related to a given asset.
The speculator builds a position, sets a profit, sets a stop loss and tries to earn a price change. Unlike Hodler, a common member of the cryptocurrency community who lives in the development of the project and supports its creators, speculation does not relate much to the given asset. He did not join any emotion, thanks to him there were no conversations selling a given token, making a profit or cutting a loss, while the hodler would not sell, because he thought it was a good cryptocurrency - he is afraid that by selling he will get off the train, he will lose something unique (FOMO), and the price will disappear and he will have to buy a more expensive token to continue to be part of the community of fans and investors of a given project.
An investor with a strong ideology connected to the cryptocurrency movement will not buy XRP, as it is a crook-bank, centralized cryptocurrency, which is a denial of what crypto-currency is supposed to be. The speculator makes no difference if he gets a change in the price of XRP, bitcoin or crude oil.
The pros and cons of speculation in cryptocurrencies
Speculation is one of the possible strategies for investing in cryptocurrencies. They are perfectly suited for this, as cryptocurrency has a high volatility. Imagination requires the investor, who in this case plays the role of a traser, good emotional skills, experience and appropriate graph analysis techniques. Imagination It uses a lot of time, which means for some people it can be a full-time job. You need to keep track of what is happening, what is news, rumors, news. You need to find bargains on the market, which are open 24 hours a day, and at different times increase the intensity of the activities of investors from Asia, Europe and the USA.
The Traider performs many moves, he assumes many positions, which means he can make many mistakes, losing funds. Summary of results is key for him the earned income is greater than the losses to stop the loss.
