digital currency investment

, , 28 comments


While Bitcoin investing can be intimidating for those just getting their feet wet, there are several tips that newcomers can use to maximize their chances of success.
By following the top five tips listed below, investors can boost their chances of meeting their goals.
1) Do Your Homework
First and foremost, investors just getting started with Bitcoin need to do their homework.
"The more you understand the better off will be," stated Pawel Kuskowski, CEO & co-founder of Coinfirm, a blockchain and regulatory technology firm.

He emphasized that "bitcoin offers a unique and rare opportunity, but needs to be treated accordingly." 
As a result, more than one expert encouraged newcomers to dive into Bitcoin's underlying technology.
"If you have any technical bent whatsoever, take 10 minutes to leaf through the original 2008 Satoshi white paper," stated crypto fund manager Jacob Eliosoff. 
"It's only 8 pages, legible and an inspiring work of genius!" 
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Lucas Geiger, founder and CEO of Wireline, offered similar guidance, stating that investors should be sure to have a strong grasp of the blockchain, the distributed ledger system that underlies all digital currencies.
"This may seem obvious, but I think the first thing is take time to understand the blockchain," said Geiger"I say this strongly, because few people will do this." 
"If you don't have a high level understanding of how a blockchain stores secure data (such as coins), then you are investing in the equivalent of tulip bulbs," he added. 
Since learning about Bitcoin can take time, newer investors might benefit significantly from working with a mentor, emphasized Adam Nestler, CEO of Kudos, a decentralized protocol for building a fair service economy. 
"Find a trusted person or resource that you can engage with to ask questions in order to understand the nuances of your investment in a safe environment," he said. 
Be careful when investing in digital currencies. Shutterstock
2) Proceed With Caution
Risk is inherent to investment, and investors should keep in mind that digital currency is in a very early stage of development when compared to similar asset markets like the stock or bond markets.
"This is still an extremely high-risk space," emphasized Eliosoff. "Don't invest money you can't afford to lose!" 
While these considerations can be quite helpful, some experts provided more specific guidance.
"Start small, and invest a small portion of your capital," suggested Marshall Swatt, a serial entrepreneur. 
Tim Enneking, managing director of Crypto Asset Management, offered tips for entering positions.
"Don’t chase Bitcoin prices. Decide on a entry point and stick with it," he said. "With Bitcoin, you’re almost always right in terms of foreseeable price action – it’s your timing that might be off. So, be patient, and let the Bitcoin price come to you." 
Once Bitcoin has reached the right price, Enneking suggested that investors refrain from buying their Bitcoin all at once. Instead, they should "stage in and stage out," meaning they should invest a little at a time, wait for a bit, and then invest some more.
Effective diversification can prove highly beneficial. Shutterstock
3) Diversify Effectively
Over the last several years, Bitcoin has produced some very impressive gains, and media outlets have developed a steady stream of stories about "Bitcoin millionaires."
While these stories might tempt an investor to put all their money in Bitcoin, keep in mind that no investment professional would advise an individual to put all their eggs in one basket.
When creating a diversified portfolio, investors could consider altcoins, more traditional assets such as stocks and bonds, or both.
The basic idea behind diversification is creating a portfolio where a decline in one component will correspond with an equal gain in another.
For example, let's say an investor has a simple portfolio, consisting of equal amounts of Bitcoin, Ether, Litecoin, Ripple and Bitcoin Cash.
If one digital currency falls 10%, then ideally, another digital asset will rise by the same amount.
Oliver Isaacs, a tech entrepreneur, emphasized that if an investor set up a diversified crypto portfolio and Bitcoin's price suddenly fell to $0, they would still be able to invest because their altcoins would still have value.
"Hedge Against Volatility and don’t put all of your eggs in one basket," he stated. "Much like investing in  the stock market or FX, you should diversify your funds as a risk management technique." 
When picking out altcoins to incorporate into portfolios, investors need to be careful, emphasized Robin Bloor, senior VP of strategy & communications for software provider Algebraix Data.
"There are a vast number of other active cryptocurrencies (hundreds)," he noted. "Remember that most of them can be thought of as start-ups and most start-ups fail.
As a result, conducting thorough due diligence is crucial, stressed Bloor.
"You need to research the business model in detail for any coin or token you are considering and then carry out due diligence - in terms of current funding, pedigree of the leadership team, original technology, marketing plans, product plans, product maturity and so on," he stated.
Wallets can be a very safe place to hold your digital tokens. Shutterstock
4) Keep Your Coins In Wallets
While exchanges are a great place to purchase digital currencies, they may not be the best place to hold such assets.
"Don't store coins on an exchange," emphasized Eliosoff. "In Bitcoin's short history many, many exchanges have gotten hacked," he noted. 
"It's fine to buy on an exchange like  Coinbase, but then move your coins into an online wallet like https://blockchain.info/wallet/, a mobile wallet like Jaxx or Coinomi, or create a paper wallet - all free and pretty easy," said Eliosoff. 
Investors can take further action to manage risk by using both hot wallets (online) and cold wallets (offline), emphasized Matthew Unger, founder and CEO of iComply Investor Services inc.
"Just like you keep some cash in your wallet, some in your bank account and perhaps the really valuable stuff in a safe, you need to manage digital currencies in the same way," he stated.
Volatility is very common in the crypto markets. Shutterstock
5) Prepare For Volatility
The digital currency markets are notoriously volatile, and there are several strategies that investors can use to manage the inevitable price fluctuations.
One strategy, diversification, is covered earlier in the article.
Another strategy, buy and hold, has been advocated by a great many financial gurus, including legendary investor Warren Buffett.
"Buy-&-forget is the right strategy for most investors," stated Eliosoff.
"Resist the temptation to make short-term bets, to 'sell at the top', to get in at the cheapest price," he said. "Most people who try this stuff underperform simple buy-&-hold." 
Gavin Yeung, founder and CEO of digital asset management firm Cryptomover, offered a similar point of view.
"We at Cryptomover believes that a passive investment style will outperform active strategies in the long term," he stated. "Not only is passive investing inexpensive and simple, it also lowers trading fees leading to much lower operating expenses."
Disclosure: I own some Bitcoin and Ether.

28 comments:

  1. Fortune Jackets care for your fashion requirements. We uphold the premium quality jackets. Visit site Thanks.

    Glee Cheerios Letterman Jacket

    ReplyDelete
  2. Fortune Jackets care for your fashion requirements. We uphold the premium quality jackets. Visit site Thanks.

    Diesel Red & White W-cash Wool Jacket

    ReplyDelete
  3. Very interesting blog. Alot of blogs I see these days don't really provide anything that I'm interested in https://dissertationsky.co.uk/marketing-dissertation-help, but I'm most definitely interested in this one. Just thought that I would post and let you know.

    ReplyDelete
  4. Thanks for sharing this information to increase our knowledge. Looking forward for more on your site. Here is such an amazing Ashkha Fashion check this out now you can get this with special discount perfectgadgets24 and with free shipping as well

    ReplyDelete
  5. It was a pretty useful piece of information! I'm only getting started with this, but I'm getting a lot more comfortable with it! Thank you, and keep up the fantastic work. visit this link: glass mosaic manufacturers

    ReplyDelete
  6. Thanks for sharing.I found a lot of interesting information here. A really good post, very thankful and hopeful that you will write many more posts like this one.
    website design services

    ReplyDelete
  7. I believe that this knowledge should be shared with everyone. You have described it so precisely that it would be amazing if you'd also us to re-share it also I didn't know that this aspect exists
    Source: Digital marketing services near me

    ReplyDelete
  8. This is a really useful piece of knowledge. I appreciate you sharing this mind-blowing knowledge with us. Please keep us updated in this manner.
    Source: ladies hair salon near me

    ReplyDelete
  9. Get a minimum of 20% off selected girl clothes orders for a limited time only · Boden discount code.. boden discount code

    ReplyDelete
  10. Cryptocurrency, often known as crypto-currency or crypto, is any type of digital or virtual currency that uses encryption to safeguard transactions. Cryptocurrencies operate without a central issuing or regulating authority, instead relying on a decentralised system to track transactions and create new units.
    O2hair

    ReplyDelete
  11. Thank you for providing this information. This website has a lot of useful Children's Entertainment Center West Hempstead. A fantastic piece, and I am grateful and hopeful that you will write many more like it.

    ReplyDelete
  12. Health is wealth! You will find the products that will suit your needs. Today is the day for healthy life changes!

    Guardian Multi-Pack

    ReplyDelete
  13. Very fascinating story, it is difficult to find interesting and relevant content among blogs now. That is why I will definitely share your blog
    Site : Synergy Kit

    ReplyDelete
  14. Articlesplanets.com is one of the most popular & trusted articles hub for Tech professionals. we provide a single source of technology, information and Healthcare Services in our Society.
    Articlesplanets brings you latest Gadgets, Mobiles, Tips and tricks, Software’s, Tech news related topics.

    ReplyDelete
  15. After reading this post, I applaud the author's efforts Enrichment Stem Program Kids am happy for the opportunity to learn about this interesting topic.

    ReplyDelete
  16. Everyone enjoys keeping up with the latest fashion trends from across the world. Yellowstone Merchandise, based on the American television series, is now available.
    John Dutton Black Wool Vest

    ReplyDelete
  17. it is difficult to find interesting and relevant content among blogs now. That is why I will definitely share your blog with my friends. I wish you success!
    Site: Cobra Kai S05 Chozen Toguchi Green & Blue Jacket

    ReplyDelete
  18. When I discovered your website, I was overjoyed. I just wanted to thank you for creating such an amazing website!! I'm having a great time here; I got my assignment topic from here, completed my homework online with Best Assignment Writing Service UK.

    ReplyDelete
  19. Your writing style is so engaging! I found myself captivated from start to finish.
    become a contributor for health and fitness

    ReplyDelete
  20. Thanks for shharing ,well if you looking for loans and stocks for your company then here working capital leads play a crucial role in maintaining a company's financial health and operational efficiency by managing the day-to-day liquidity and cash flow needs.
    Effective management of working capital leads helps businesses meet short-term obligations, such as paying suppliers, managing inventory, and covering operating expenses, ensuring smooth operations.

    ReplyDelete
  21. Looking for best mobile phones in Canada? Swiftronics store is a tech enthusiast's haven, offering a vast array of cutting-edge electronics and gadgets. From the latest smartphones to state-of-the-art smart home devices, it's a one-stop-shop for all things tech. With knowledgeable staff and top-notch customer service, Swiftronics Store ensures a seamless shopping experience for every tech-savvy individual.

    ReplyDelete
  22. Excellent blog! Such clever work and exposure! Keep up the very good work. Bella Swan Jacket

    ReplyDelete
  23. What I love most about this ted lasso jacket for sale is how it captures the show's essence without being overly flashy. It's a tasteful nod to Ted Lasso's iconic style, allowing you to embrace your inner coach with subtlety and grace. Plus, it's incredibly comfortable – perfect for those inspiring pep talks, on or off the field

    ReplyDelete
  24. This is really great work. Thank you for sharing such a useful information.
    Regards:
    AffordableAffordable SEO services!

    ReplyDelete
  25. Thankful สล็อต such an awesome sum for sharing this glorious information! I am envisioning see more posts by you.

    ReplyDelete
  26. John Dutton's cotton jacket is more than just apparel; it's a statement of rugged elegance. Whether you're in the wild or navigating city streets, this jacket effortlessly combines fashion and functionality, making it a wardrobe essential for the modern adventurer
    Site: john dutton s03 jacket

    ReplyDelete
  27. Very good post thanks for share. TR SKIN

    ReplyDelete
  28. Merely a smiling visitant here to share the love (:, btw outstanding style. Also check our best on page seo service.

    ReplyDelete