The price of Bitcoin is dancing around $50,000, and fence-sitters can’t decide whether to jump in or wait. If you’re undecided, you’re not alone. Starting to trade cryptocurrencies can be quite intimidating and there are several tricks you must learn if you want to keep your money safe.
A recent study by Survey Monkey showed that 1 in 10 among the polled Americans said they had some cryptocurrency investment. That places Crypto in the fourth position after real estate, stocks, mutual funds, and bonds. The poll showed 65% of the investors joined the crypto fray in 2020. At least 14% of American adults own some form of cryptocurrency, but up to 63% said they were “crypto curious.”
What makes crypto investment attractive?
Investors cited the ease of making a trade, excitement, and the possibilities of making a quick profit potential as the main reasons for investing in Crypto. Douglas Boneparth, a New York-based investor, said:
“There are a lot of things that make crypto very attractive; the biggest one is the opportunity to make a lot of money.”
Is cryptocurrency safe?
Cryptocurrency is considered to be among “high risk, high reward” investments. It’s highly speculative and therefore riskier than investing in stocks, at least for now. Stocks are mainstream investments because they’ve been here for a more extended period and have established actual use cases. Cryptocurrencies aren’t necessarily a bad investment; things will change as the world finds their real-life utility. Early investors will then make a windfall.
Cryptocurrency investment won’t work for you if you’re too worried about losing your money. Like in all other investment forms, there’s always a chance that you won’t succeed. Cryptocurrencies are also highly volatile; therefore it is important that you only invest what you can afford to lose. On the positive side, though, taking some risk in the crypto trade has the potential for lucrative rewards.
3 tips for safe cryptocurrency investment
There are several things you need to consider if you’re planning to invest in Crypto. These include the following:
1. Only invest the money you can lose comfortably
There’s never a guarantee when you invest. Since Crypto carries a higher risk than other investment forms, don’t invest more than you can afford to lose.
2. Have an Emergency Fund
Always set aside an emergency fund with three to six months’ worth of savings. Cryptocurrencies are still volatile, and prices could fall suddenly. You want to avoid selling your crypto investment at rock bottom price because you got an emergency.
3. Education is Key
Take the time to learn about different cryptocurrencies before you buy since they’re not created equal. Bitcoin and Ethereum may be the most prominent digital assets, but others could be more profitable. Always have a long-term outlook instead of a “get-rich-quick” perspective.
The cryptocurrency investment comes with a good share of risk, doesn’t mean it’s something you should shun completely. Once again, try investing only as much money as you can comfortably lose due to volatility and general risks. Cryptocurrency may not be a good investment for everyone. However, it may potentially be the investment you’ve been waiting for. Boneparth told Survey Monkey:
“Don’t get it twisted when it comes to how fun and cool something is versus the real risks.”
Tom is a freelance writer with over 10-years’ experience in content creation, blog writing, and SEO specializing in the blockchain and cryptocurrency niche. As a philosophical figurehead, he believes that to make our world a better place, we must invest in incorruptible products and procedures, of which Bitcoin and other cryptocurrencies are leading examples.