Investing in cryptocurrencies – Is it worthwhile?
- Updated On 05/05/2021
- Author : Ram kumar
- Topic : Technology
- Short URL : https://hellboundbloggers.com/?p=66987
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Similar to the ups and downs of the Bitcoin price, the media response in more or less regular cycles is also increasing. This always leads to a large number of previously inexperienced users asking: Should I invest in Bitcoin and if so, how does it work?
Why invest in cryptocurrencies?
If you invest in currencies like Bitcoin, Ethereum or Ripple, you do not want to pay for it in the least amount of cases or use them in any way- even if theoretically this would be possible on sites like Umbingo or even in the Windows Store. This is because the high volatility of the price, the complicated registration and verification processes, and last but not least, the transaction fees make the purchase much easier than facilitating it.
Instead, most users want to benefit from the partially absurd price gains – no wonder, because who will not be jealous if a system grows in phases within a short time several times by 100%? It is precisely this volatility that makes Bitcoin – and therefore virtually all other cryptocurrencies as most of Bitcoin’s market moves follow – a very risky asset class for inexperienced private investors. Check out the crypto heatmap to learn more about the latest top gainers.
Even more so than in other categories applies here: There is the not so unlikely chance that the assets used loses its entire value.
On the other hand, there are astronomical price gains, which make one or the other buyer to throw caution overboard. So what should you do when investing in cryptocurrencies?
How do I invest the most in cryptocurrencies?
Point 1: Basically: Never invest more than you are willing to lose. This possibility exists here quite real, so that in any case only the money may be used, which can be waived even in an emergency.
Point 2: At the beginning, work out a strategy and do not deviate from it. The crypto market is unbelievably volatile: those who always adapt their investment strategy to the current price fluctuations not only lose a lot of money, but also prove that they do not trust their own strategy. It is better here at the beginning to spend a lot of time thinking about which losses can be accepted and which profit target is sought. Then you can use automated orders that sell automatically when a profit target has been achieved or sold, for example, when a loss of value of 30% occurs to prevent worse. Exactly so can currencies be bought automatically, if their price reaches a certain, pre-defined value.
Item 3: Do not try to take the market. The so-called ‘market timing’ describes the entry to the lowest possible and the exit at the highest possible time, so an ideal image – since Bitcoin & Co., however, are so unpredictable, gets in the reality of virtually no one. Smarter, it is here to put on the Cost Average effect: For example, who each month invested a set amount, ultimately ends up even below the average price.
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