Cryptocurrency Investment? How to grow your wealth with cryptocurrency investment? Everything you have wanted to know about investing in cryptocurrencies.
- The high rate of volatility among cryptocurrencies.
- The prospect of 24 x 7 trading and investing.
- Ways of accumulating cryptocurrencies other than directly buying them.
- Investing in cryptocurrencies beyond boundaries.
- Peer-to-peer trading.
- Full control over your cryptocurrency investments.
- The importance of securing your private access keys.
- The importance of studying white papers associated with cryptocurrencies you are investing in.
Cryptocurrency Investment – Cryptocurrency values are volatile. Just like international currencies, cryptocurrency values go up and down. Although they are not as volatile as conventional currencies because, in cryptocurrency trading, the value of the coins that you purchase may grow exponentially, the basic concept remains the same.
You buy when the prices are low, and then, if you want, you can sell when prices are high.
Here is an example of how cryptocurrency investment brought windfall profit for a rapper named 50 Cent.
In 2014 50 Cent released an album and started accepting Bitcoin payments. Back then, he earned 700 bitcoins that, at that time, amounted to around $ 460,000.
By 2019, his bitcoin value was $ 8 million.
Famous people who have invested in cryptocurrencies such as Bitcoin and Ethereum include
- Mike Tyson
- Elon Musk
- Jack Dorsey
- Maisie Williams (of Game of Thrones fame)
- Snoop Dog
- Kanye West
- Lionel Messi
- Richard Branson
- Ashton Kutcher
Are you excited about investing in cryptocurrencies? Here are 8 things you must know before you embark upon a journey to find your fortunes in the wild world of cryptocurrencies and tokens.
1. Cryptocurrencies are highly volatile
Just as you trade in stocks and forex, you can also trade in cryptocurrencies. Cryptocurrencies are multiple times more volatile and hence prone to growing your wealth in great proportions compared to conventional stock and forex trading.
Just a small example: between 2017-2018, the price of a single bitcoin rose to as high as $ 19,378 and as low as $ 5851.
This is just one cryptocurrency instance. All major cryptocurrency investments go through extreme highs and lows and this gives you plenty of opportunities to buy low and sell high within a single month, and sometimes, even within a single day.
2. You can trade 24 x 7
Investing in cryptocurrencies does not need to stop by the end of the day. It does not matter where you are and in which time zone you’re live. As long as you have an Internet connection and a mobile app or a web dashboard that enables you to trade in cryptocurrencies, you can invest – you can buy and sell.
Precisely this is the reason why cryptocurrencies are being preferred for international monetary exchanges over conventional money.
3. You can mine instead of buying cryptocurrencies and tokens
Many people think that now that the prices of all the major cryptocurrencies are quite high, they are out of reach. This is not the case.
If you have a technical background and you love solving algorithmic puzzles, you can also mine for your favorite cryptocurrencies or play games that can earn you crypto coins.
This is one of the most popular ways of investing in cryptocurrency digital assets among computer enthusiasts. Mining is needed to validate different blocks of a blockchain and for that, you need to solve difficult algorithmic puzzles.
By showing proof of work and the proof of time that you have spent, you can earn crypto coins like Caesium and build your wealth over time.
4. International trading
Cryptocurrency investment facilitates International trading because these transactions are not controlled by geographic boundaries, political systems, or conventional financial institutions.
Cryptocurrencies are as digital as they come. They exist on blockchains that are scattered all over the world, interconnected by computers.
5. Peer-to-peer trading
Although buying and selling of cryptocurrencies is made possible through Defi exchanges and mobile apps, the fundamental transactions happen between individuals – you can trade one currency exchange for the other.
There is no centralized authority. There are no conventional brokers. The exchange or the mobile phone that you use to carry out the transactions may charge a small transaction fee, but other than that, there is no third-party involvement.
6. Complete control over your wealth
You have complete control over investing in your cryptocurrency digital assets. Your ownership of the coins cannot be altered or changed.
You can keep all your transactions anonymous and only among the transacting parties. Your information remains private. There is no third-party supervision or control over your cryptocurrency digital assets.
7. You need to be careful about your access keys
There is no central authority that controls your cryptocurrency digital assets. When you are investing in cryptocurrencies, you are solely responsible for the access. It is not like the traditional money that is stored in the bank.
In the bank, if you lose something like your net banking password, or even if you forget your bank account number, or lose your debit card pin, there are still some mechanisms that allow you to retrieve your cash.
In cryptocurrency, since there is no central authority to supervise transactions or keep the records of who owns what, if you lose your private access key, you lose your digital assets forever.
Therefore, it is very important to preserve your private access key, or multiple private access keys, if you want to access your cryptocurrency digital assets in the future, after investing in them.
8. Carefully read the cryptocurrency investment, White Paper
For example, you can download and read the white paper for Caesium cryptocurrency. Every legitimate cryptocurrency project has a white paper. Consider it a red flag if the cryptocurrency does not come with a White Paper.
It may seem tedious to read multiple white papers to consider which cryptocurrency you should invest in, but considering that you will be investing your hard-earned money and you stand to lose a lot of money if you misjudge, it is worth your time.
A white paper associated with a cryptocurrency gives you technical information about the concept behind the cryptocurrency and the roadmap for its growth and success.
The white paper contains statistics, diagrams, and the facts that back the idea behind the cryptocurrency being developed and why it may be profitable for people to invest in that particular cryptocurrency.
Finally, you must understand that when you are investing in cryptocurrencies, you are on your own. There is no redressal system. All the transactions are peer-to-peer, so you need to trust your judgment as well as the judgment of the other party or the exchange that you are using.
The safest bet is to invest in blue-chip cryptocurrency coins like bitcoin, ether, and caesium. They have a good track record.