Tuesday, August 9, 2022

Key Things to Know Before Investing in Cryptocurrency

Key Things to Know Before Investing in Cryptocurrency

Whilst Bitcoin and cryptocurrency as a whole may have become increasingly mainstream concepts over the course of the last few years or so, its volatile and often misunderstood nature means that a staggering 97% of Brits have yet to buy into digital currency.

After all, it was back in December 2017 that Bitcoin’s value achieved a peak of $20,000, only for this figure to sink spectacularly to a paltry $3,600 barely 12 months later.

Despite this, Bitcoin and similar entities remain a viable investment option for knowledgeable and disciplined investors who understand how the cryptocurrency space works. There are other considerations to keep in mind when investing too, including the following:

The Importance of Research

The Importance of Research

In fairness, many of the rules that pertain to cryptocurrency investing are universal, with the single most important being the role that research plays in successful transactions.

Make no mistake; you’ll need to research your chosen market and asset class before investing your hard-earned cash in cryptocurrencies, with the volatile nature of this sector both well-known and capable of swallowing your financial resources.

Researching real-time prices and historical trends is even important when investing in currencies such as Bitcoin, as high levels of exposure and demand can trigger significant fluctuations in price points and undermine even the most considered strategy. You may also read the coffee miner strategy of mining coins on your own published by ArnauCode.

Understand the Impact of FDO and FOMO

Whilst the concepts of FUD and FOMO are not exclusive to cryptocurrency trading, they can have a significant impact on your fortunes when dealing in assets such as Bitcoin.

These acronyms relate to variable emotional states that can impact on your investment decisions, with the former (Fear, Uncertainty and Doubt) capable of impairing your judgment and significantly undermining values in instances where FUD spreads across social media and grips the entire market.

Conversely, FOMO refers to the so-called ‘fear of missing out’, and this may encourage you to enter headlong into the market without any preparation or understanding.

Track your Activity and Only Ever Invest What you can Afford

Track your Activity and Only Ever Invest What you can Afford

On a final note, it’s important to track your funds and activity over an extended period of time, as this ensures that you operate within a predetermined budget.

This should stipulate that you never invest more than you can comfortably afford to lose, regardless of whether you’re a wealthy investor or someone who’s looking to trade cryptocurrency as something of a side hustle.

Fortunately, this is easier than ever in the digital age, with virtual trading platforms such as ATFX offering real-time access to various account and risk-management tools.

This enables you to monitor your activity in detail, whilst also implementing tools that minimise loss on every individual trade.

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Edward Cullens
I am Edward Cullens passionate of internet stuff such as blogging, affiliate marketing and most important, I like to trade domain and website. If you are inside digital marketing, let's connect us for future opportunities I am currently working at Techlipz.com.