Tuesday, June 28, 2022

Is Investing In Crypto Worth It

Can You Become A Crypto Millionaire With $10000

Meme Coin Mania: Is It Worth An Investment? | Coffee & Crypto

If you want to venture into the crypto market with $10,000, you have more options available. Also, the chances are much higher. With $10,000, you would need a 100x ROI in 2021 to become a millionaire. Is that achievable in 2021?

Yes, if you manage to find the right cryptocurrency. For example, Verge managed an insane 2,000x growth in 2017 when Ethereum achieved a 165x ROI. XRP and NEM both did a combined 120x in 2019. These are all real crypto projects, not pump and dump schemes.

With $10,000, you can also venture into mining of cryptos or even diversify your crypto portfolio and wait for them to explode. If you decide to go down the path of trading with a capital of $10,000 also means that you have more to put on the table for more profits.

You Dont Understand How To Read A Trading Chart

Once you understand some basic dynamics such as supply and demand, then you should start learning how to read trading charts, also known as technical analysis.

Technical analysis is a science which helps you better predict the future by analyzing historical market data. Youll gain a feel for when markets are about to turn, or if assets arent priced properly.

For some, its super helpful and core to many peoples cryptocurrency investment strategy.

BabyPips is a popular place to start learning technical analysis, and it applies to all markets, not only crypto.

Knowing how to read charts can give you an advantage over those who dont – and it can be quite lucrative.

What More Institutional Adoption Means For Investors

While paying for things in cryptocurrencies doesnt make sense for most people right now, more retailers accepting payments might change that landscape in the future. Itll likely be much longer before itll be a smart financial decision to spend Bitcoin on goods or services, but further institutional adoption could bring about more use-cases for everyday users, and in turn, have an impact on crypto prices. Nothing is guaranteed, but if you buy cryptocurrency as a long-term store of value, the more real world uses it has, the more likely demand and value will increase.

Read Also: How Do You Put Money Into Bitcoin

You Dont Hodl Hard Enough

On the flip side, lots of investors are impatient and cut their losses early because of emotions.

The cryptocurrency market is made of cycles, where prices rise and fall drastically.

If you buy high, then you will need to wait out an entire new market cycle to end up with profits – meaning a new bear, then bull run – which can be well over a year of waiting.

Remember: if you still believe in the project, then your best bet is to be patient and hold strong, even if the price is dropping fast.

Is Bitcoin Bad For The Environment

3 Crypto Currencies worth investing in

The digital currency uses as much power as the Netherlands every year, with just 30 countries using more energy, according to researchers from the University of Cambridge.

Computers that mine bitcoin use up to 1% of the worlds electricity supply.

While some of bitcoins consumption is renewable , fossil fuels are still being used to power the mining and servicing of the digital currency.

This is why electric car manufacturer Tesla has stopped accepting crypto payments, causing bitcoin to fall. Find out more in our Guide to eco-friendly cryptocurrencies.

Also Check: How To Buy Dash Crypto

Bitcoin Remains Dominant In 2021

Historically the largest cryptocurrency by market cap has been Bitcoin, and that continues to be the case in 2021. Thats why it is the most talked about cryptocurrency, and the cryptocurrency that attracts the most investment capital. Bitcoin dominance in July 2021 is nearly 45% of the total market. In a far second place is Ethereum, which has a market domination of just over 18%. Then there are others such as Binance Coin, Ripple, and Cardano.

Given its dominant position and longevity Bitcoin is currently the most reliable cryptocurrency for creating a core position. That said, Ethereum has performed better in 2021, albeit with more volatility as well. And some smaller cryptocurrencies have done even better. Thats why we recommend a diversified crypto portfolio.

Either Bitcoin or Ethereum would work well as a core, with smaller cryptocurrencies making up the satellite positions in your portfolio.

Keep in mind too that the broader market often takes its lead from Bitcoin. So when Bitcoin is rising the rest of the market also tends to do well. And when Bitcoin is falling the rest of the market tends to follow it lower. Consider Bitcoin as the core and all other cryptocurrencies as more speculative in nature and you will have a good start to a cryptocurrency portfolio in 2021.

You Leave Your Coins On Exchanges

One of the most famous mottos in the crypto industry is if you dont control your keys, then you dont control your coins.

Exchange are huge targets for hackers and are always at risk. When you leave coins on an exchange, the exchange controls your coins. You are trusting the exchanges security measures and not your own.

Do yourself a favor – keep your coins in a personal wallet.

You May Like: How To Buy Crypto With Ira

What Types Of Cryptocurrency Exist

Bitcoin is the topmost traded cryptocurrency that everyone knows and talks about, but its not the only kind of cryptocurrency out there. Theres Litecoin, Polkadot, Chainlink, Mooncoin, Shiba Inu, Dogecoin, etc. Currently, there are more than 6,000 coins in existence, as per CoinMarket cap.

Bitcoin is the most stable coin. As the first cryptocurrency, Bitcoin traded below one dollar. Over the years, Bitcoin picked up a price momentum and has exceeded the market cap of $1 trillion. Meanwhile, investors should explore their options and choose the asset that could best serve their needs.

Are Cryptocurrencies A Good Investment

Initial Coin Offerings: Worth An Investment? | Coffee & Crypto

Cryptocurrencies may go up in value, but many investors see them as mere speculations, not real investments. The reason? Just like real currencies, cryptocurrencies generate no cash flow, so for you to profit, someone has to pay more for the currency than you did.

Thats whats called the greater fool theory of investment. Contrast that to a well-managed business, which increases its value over time by growing the profitability and cash flow of the operation.

For those who see cryptocurrencies such as bitcoin as the currency of the future, it should be noted that a currency needs stability.

Some notable voices in the investment community have advised would-be investors to steer clear of them. Of particular note, legendary investor Warren Buffett compared bitcoin to paper checks: It’s a very effective way of transmitting money and you can do it anonymously and all that. A check is a way of transmitting money too. Are checks worth a whole lot of money? Just because they can transmit money?”

ยป Learn more: Is bitcoin safe?

This price volatility creates a conundrum. If bitcoins might be worth a lot more in the future, people are less likely to spend and circulate them today, making them less viable as a currency. Why spend a bitcoin when it could be worth three times the value next year?

Read Also: How Many Bitcoins Are There Now

How We Make Money

You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout lifes financial journey.

Bankrate follows a strict editorial policy, so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers.

Were transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money.

Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service.

The Value Depends Largely On Popular Opinion

Investing in crypto-assets is highly speculative. The market value can fluctuate a lot over short periods of time, and is affected by things like media hype and investor opinion.

The price of crypto may depend on:

  • its popularity at a given time
  • how easy it is to trade or use it
  • the perceived value of the currency
  • its underlying blockchain technology

Don’t Miss: How To Receive Crypto On Coinbase

How Do I Buy Cryptocurrency

While some cryptocurrencies, including bitcoin, are available for purchase with U.S. dollars, others require that you pay with bitcoins or another cryptocurrency.

To buy cryptocurrencies, youll need a wallet, an online app that can hold your currency. Generally, you create an account on an exchange, and then you can transfer real money to buy cryptocurrencies such as bitcoin or Ethereum. Here’s more on how to invest in bitcoin.

Coinbase is one popular cryptocurrency trading exchange where you can create both a wallet and buy and sell bitcoin and other cryptocurrencies. Also, a growing number of online brokers offer cryptocurrencies, such as eToro, Tradestation and Sofi Active Investing. Robinhood offers free cryptocurrency trades .

Important Cryptocurrencies Other Than Bitcoin

Here is Why Investing in Crypto is Worth the Risk

      Bitcoin has not only been a trendsetter, ushering in a wave of cryptocurrencies built on a decentralized peer-to-peer network, but also has become the de facto standard for cryptocurrencies, inspiring an ever-growing legion of followers and spinoffs.

      Also Check: Can I Buy Bitcoin With Venmo

      Cryptocurrency Fraud And Cryptocurrency Scams

      Unfortunately, cryptocurrency crime is on the rise. Cryptocurrency scams include:

      Fake websites: Bogus sites which feature fake testimonials and crypto jargon promising massive, guaranteed returns, provided you keep investing.

      Virtual Ponzi schemes: Cryptocurrency criminals promote non-existent opportunities to invest in digital currencies and create the illusion of huge returns by paying off old investors with new investors money. One scam operation, BitClub Network, raised more than $700 million before its perpetrators were indicted in December 2019.

      “Celebrity” endorsements: Scammers pose online as billionaires or well-known names who promise to multiply your investment in a virtual currency but instead steal what you send. They may also use messaging apps or chat rooms to start rumours that a famous businessperson is backing a specific cryptocurrency. Once they have encouraged investors to buy and driven up the price, the scammers sell their stake, and the currency reduces in value.

      Romance scams: The FBI warns of a trend in online dating scams, where tricksters persuade people they meet on dating apps or social media to invest or trade in virtual currencies. The FBIs Internet Crime Complaint Centre fielded more than 1,800 reports of crypto-focused romance scams in the first seven months of 2021, with losses reaching $133 million.

      How Does Trading Cryptocurrencies Differ From Stocks

      While you can invest in cryptocurrencies, they differ a great deal from traditional investments, like stocks. When you buy stock, you are buying a share of ownership of a company, which means youre entitled to do things like vote on the direction of the company. If that company goes bankrupt, you also may receive some compensation once its creditors have been paid from its liquidated assets.

      Buying cryptocurrency doesnt grant you ownership over anything except the token itself its more like exchanging one form of currency for another. If the crypto loses its value, you wont receive anything after the fact.

      There are several other key differences to keep in mind:

      Recommended Reading: How To Buy Things With Bitcoin

      What Are The Key Pluses Of Cryptocurrency Trading

      There is a set of reasons which make crypto investments the best choices. Since the quality of trading experience directly relies on the kind of service or app you use, we will highlight the advantages of trading using the example of the trustworthy service Bitcoin Code.

      1. Legit functioning. The activity of this tool complies with the law and offers transparent trading operations for the users.

      2. Ease of use. The platform Bitcoin Code doesnt require specific knowledge to use. Just register, log in to the platform and enjoy the flawless trades.

      3. Fast speed of transactions. The platform is considered one of the fastest places to trade for profit. Crypto transactions are, in general, faster and easier to perform due to their decentralized nature. One trade will take up one second to a minute when using this place, depending on the type of crypto coin and the amount.To see the booming coin to invest in right now and later this year, read this article by US News.

      4. Instant withdrawal. Once you notice there are bonuses or earnings from trading in your account, you can quickly get them and choose the convenient method. You dont wait for days to take what is yours!

      5. Automation. Automatic software known as bots is effective in helping Bitcoin Code users to identify the correct time to buy certain crypto coins, make predictions for the near future, and find the most convenient rates for your exchanges.

      Risk Warning

      Don’t Try To Time The Market

      Meme Coin Mania: Is It Worth An Investment? | Coffee & Crypto

      When you look back in time everything seems very logical and obvious. You may regret not having bought Bitcoin at $1,000 or not having sold it at its peak. This regret will get you nowhere. Do your research and if you feel that a particular crypto is undervalued, then buy it. Or if you think it’s overvalued, then sell it.

      Read Also: How Do Taxes Work On Cryptocurrency

      Prepare For Volatility And Risk

      I think its pretty well known that cryptocurrency investing and volatility go hand in hand. While the larger coins like Bitcoin and Ethereum have calmed down to some extent, moves of 10% are still not unusual. However smaller tokens can move that much and more day after day, and those moves can come in either direction. That makes it crucial to learn as much as possible about any token and its underlying project before investing.

      In fact, the more you understand, the better investing decisions and choices youll be able to make. For example, some investors approach Bitcoin in much the same way they approach gold. They see it as a store of value, and as a way to hedge against inflation. Thats why Bitcoin has picked up the names digital gold and gold 2.0.

      Ethereum is a different story, with investors attracted to the second largest cryptocurrency based on its utility and use in smart contracts and decentralized finance.

      Cryptocurrencies are considered an alternative asset, a group that also includes real estate and commodities, because they are a way to diversify out of traditional assets like stocks and bonds. While they are great at providing diversification cryptocurrencies also remain quite volatile, and can even be influenced by news items and comments from popular personalities.

      The good news is that despite the volatility, over the long-term Bitcoin has an average annualized return thats greater than 200%. So embracing volatility can lead to impressive gains.

      How Many Bitcoins Will Be Mined In 2022

      Currently, there are about 900 new bitcoins being mined every day. If this were to continue to be the case throughout all of 2022, then about 328,500 bitcoin could be mined this year.

      The interesting thing to note is that more people mining Bitcoin does not lead to an increase in the number of coins being mined. The block reward is currently set at 6.25 , and one block gets mined roughly every 10 minutes. Increased competition for blocks leads to a higher hash rate, but the number of new coins being minted remains the same.

      You May Like: What Is The Point Of Cryptocurrency

      You Dont Own A Hardware Wallet

      I will be straight up: if youve invested more than $500 in cryptocurrencies, then hardware wallets are a smart investment.

      They are disconnected from the internet, which means that hackers can only obtain your funds if they steal your physical device and also know the passphrase to access it. This makes security a much easier task.

      If you have large amounts of money, say over $5,000, then it may be worth buying two. The second can act as a copy to the first one, in case you lose it.

      Are Cryptocurrencies Legal

      Is It Worth It To Invest in Crypto?

      Theres no question that theyre legal in the United States, though China has essentially banned their use, and ultimately whether theyre legal depends on each individual country. Also be sure to consider how to protect yourself from fraudsters who see cryptocurrencies as an opportunity to bilk investors. As always, buyer beware.

      Recommended Reading: What Is Cryptocurrency Trading Platform

      How Crypto Is Used

      Crypto-assets were first developed as a digital form of currency, to be used as money. Some stores accept crypto as payment for goods and services, and some ATMs let you withdraw it as physical money. However, crypto is not legal tender in Australia and is not widely accepted as payment.

      Crypto is more commonly used as a speculative, longer-term investment, as most people dont access their balance for everyday transactions.

      Crypto Scams Are Increasing

      There are two main types of crypto scams.

    • Fake opportunities to buy crypto
    • Using your own crypto to invest or pay for something
    • Scammers try to trick people into investing in fake opportunities to buy crypto. Watch out for these tactics:

      • false promises of very high returns
      • fake endorsement from celebrities or government agencies
      • people who contact you through social media or text messages
      • using dating apps to establish a romantic connection and gain trust
      • multiple or constantly changing bank accounts used for transfers

      Read more about the tactics used by investment scammers.

      Rhett is scammed $97,000 by a fake endorsement

      Rhett saw an article on a news website about The biggest deal in Shark Tank history, that can make YOU rich in just 7 days!

      Rhett was interested in trading Bitcoin, so he provided his contact details. Soon, an Account Manager named Max began calling Rhett. Max called often, pressuring Rhett to open a trading account and make a deposit. By depositing between $40,000 and $50,000 upfront, Max promised Rhett he could earn at least $15,000 per month.

      Max promised Rhett that the money he deposited would be safe because he would have total control of the account. Its more or less moving your money in your left pocket from your right pocket, Max said. Max promised Rhett that he could withdraw his money whenever he wanted to.

      Rhett deposited more money in the hope he could recoup his losses. Rhett ended up depositing and losing a total of $97,000.

      You May Like: How To Get Into Cryptocurrency Investing

      Popular news
      Related news