Every year more people are getting interested in investing in crypto. Even though cryptocurrency is not new on the market, crypto investing is a new trend. The new philosophy claims that the opportunity to earn and do business should move from large corporations and institutions to ordinary people. Lucky for us, the crypto-ecosystem already has all the components necessary for this
For instance, the Ownrwallet ecosystem provides you with a multifunctional cryptocurrency wallet that allows you to store your coins in a non-custodial wallet and to buy crypto using bank cards.
Cryptocurrency is growing more and more all the time. These days a lot of shops, restaurants, and banks are already accepting payments in cryptocurrency, and only more acceptance of digital money as a payment instrument is expected. This provides more flexibility and freedom for the investor, including the ability to turn their assets into goods and services with a single click. Before making use of all the advantages, you need to obtain cryptocurrency. The Ownrwallet ecosystem is a safe and accessible platform that allows you to purchase crypto with your bank card anytime from any place in the world.
Investing in cryptocurrency became so popular because it provides an opportunity to earn money quickly. But your investment journey with crypto can result in greater losses than in other markets. Investopedia shares some valuable notes for newcomers to crypto investing:
- The rate of most cryptocurrencies depends mainly on the demand for Bitcoin due to the dominant position of Bitcoin (62% of the market) among blockchain projects. For example, Ethereum capitalization is only 16% of the total market volume.
- Investing in cryptocurrencies comes with a high risk that every investor must consider. Exchange rates fluctuate by tens to hundreds of percent over a few months. For example, from October 2020 to February 2021, the price of Bitcoin increased by over 340%.
- To invest in crypto, you need an investment plan. You need to clearly understand how quickly you want to make a profit, how much you are willing to invest, and which assets you want to use.
The most important rule for a novice investor is to invest exactly as much as you are prepared to lose if the investment project fails and to research the cryptocurrency market on your own.
Forbes adds other recommendations for you to consider before investing in crypto:
- Get ready for high volatility
The cryptocurrency market is very volatile, so be prepared for drastic currency price fluctuations. If your investment portfolio or mental well-being is not capable of withstanding such fluctuations, cryptocurrency may not be the best choice.
- Diversify your investments
Diversification is the key to a successful investment strategy. For example, you should not invest all your money in Bitcoin just because it is a well-known name. There are thousands of investment options, and it is better to spread funds across multiple currencies.
Among the variety of cryptocurrencies, there are three most popular today:
Among altcoins, Ethereum (ETH) is the most notable. It is a digital currency that can be successfully used for both investment and money transfers due to exchange rate fluctuations. Until recently, it was believed that the price of Ethereum (ETH) was highly dependent on Bitcoin (BTC), but the results of a study published by the analytical company Skew show that within 24 months of 14 significant changes in the rates of BTC and ETH, only in five cases did the price of Ethereum (ETH) change following Bitcoin.
Litecoin is an open-source cryptocurrency under the X11 license, which is similar to Bitcoin but has a number of significant differences. Firstly, the Litecoin network processes a block every 2.5 minutes, while Bitcoin processes every 10 minutes, which allows transactions to be confirmed more quickly. Secondly, the Litecoin network will produce 84,000,000 coins, which is four times the number of BTC coins in the Bitcoin network.
Binance Coin (BNB) is an instrument token owned by one of the largest cryptocurrency exchanges, Binance. The BNB rate does not correlate with the prices of other digital currencies, which makes it more resistant to price fluctuations. In addition, BNB works as part of the Binance platform loyalty program and gives access to certain services as part of trading on the exchange, in particular, rapid exchange for other cryptocurrencies.
Investing in cryptocurrencies is always a risk. The crypto market is decentralized; therefore, it has a very high level of volatility: fluctuations in the rate of different coins can vary from 1-2% to 100-300% in a short time. In addition, cryptocurrency is strongly tied to demand. That is, if large market players buy certain coins at a certain time, this moves the market in one direction or another. If you are interested in taking risks, then investing in crypto may be for you.
This news is republished from another source. You can check the original article here