Making a smart investment is something that future you would thank you for. However, before starting to visualize yourself on the pile of cash let’s simply break down how to invest in cryptocurrency.
There are certain ways and rules you should obey before investing in Cryptocurrency in 2021. If you’re reading this, it’s likely that you have a goal in mind that you want to reach with your future investment. It might range from owning several real estates and luxurious cars to just having financial stability and freedom.
In this article, we’ll discuss how to invest in Cryptocurrency and make sure to hit our target.
1) Be 18+
I know it sounds obvious, however, this is still a thought to keep in mind. You have to be above 18 years old to independently invest in digital currency. But do not get upset just because you do not meet this criterion because there still is a way you can invest in Cryptocurrency while under 18.
You can create a Custodial Account. With a custodial account, any parent, friend, or relative can open a custodial brokerage account for a minor. The person that opens the account, known as the custodian, controls the account on your behalf.
2) Invest less than what you can afford to lose.
I can’t stress enough how important this step is. Remember that you are investing to improve your current financial situation not to worsen it. Therefore, it’s always good to take a look at your finances first. Consider what amount you are okay with losing and only after that invest it in your portfolio.
For example, back in the days when I started investing in Cryptocurrency, this was the rule I kept in mind. Digital Currencies were totally a new fruit back then. Therefore, gathering information about a specific subject was much harder. What was left to do? – Do the research with my team. My portfolio held Cryptocurrencies out of which some gave me wins and some gave me losses.
But I am still up and profiting. Why? Because I invested what I could afford to lose and I played a long game.
3) Don’t act based on emotions.
No seriously, once it comes to investing dump your emotions out of the window. You will not need them. Even more, emotions can have a really negative effect on your decision-making.
I know it might sound funny but be like a snake in its habitat, cold-hearted with zero feelings attached.
A lot of people fall victim to FOMO (Fear Of Missing Out) every single day or even panic selling, resulting in hurting their portfolio. Which would not happen if people look at investing more rationally than emotionally. So I think you got my point.
4) DYOR – Do Your Own Research
Another important step before purchasing a coin. Make sure that you have a general idea of what you are investing in. A large portion of people, promoting and suggesting investment opportunities, have no idea nor about the coin potential nor about their own action.
Internet is your best friend once it comes to doing your due diligence.
Also, never follow the hype. You wake up in the morning and hear that “X coin” has increased by 95% in value and everyone keeps talking about it. Should you invest in the coin too? Well, the answer is both, yes and no. If you DYOR and feel like the coin has solid potential in long term then YES. If you plan to invest purely because of the hype around it, then it’s a strong No-No.
5) Play the long game
If you didn’t know it before let me be the first to tell you: Cryptocurrencies are very volatile. This means their change in value can be +40% one day and -15% the other. However, this is not something that should scare you off. Instead, you should concentrate on investing in the long term.
After doing your own research, and becoming more confident with your coin selection you just need to cut off your emotions and let the time play its part.
Programming your mind for patience and the long-term game gets you ahead of at least 50% of cryptocurrency investors.
It’s waiting that helps you as an investor, and a lot of people just can’t stand to wait.
Charlie Munger
6) Create a Brokerage account
You need a place where you can invest in Cryptocurrency right? There are numerous platforms where you can buy, sell & exchange Cryptocurrencies.
- Create an account and verify it under your name.
- Deposit funds to your account.
- Exchange your deposited funds to any Cryptocurrency you want to own.
One of the most reputable Crypto exchanges I recommend is Binance.com. Binance is a cryptocurrency exchange that provides a platform for trading various cryptocurrencies. It is ranked among the largest cryptocurrency exchanges in the world in early 2021, with a trading volume that was twice as high as Dsdaq. It supports more than 150 different Coins and consistently adds more to its pool.
Create your account on Binance.
Conclusion
If you are planning to or considering moving some funds to Cryptocurrency – Kudos to you.
Starting is usually the hardest part of the process. After getting your feet in the water you will be surprised how exciting and rewarding your decision becomes. Just keep in mind 6 important steps that we have discussed today and you will be good to go.
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