Wednesday, May 18, 2022

What To Invest In Cryptocurrency

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Is Cryptocurrency A Good Investment Four Things To Know

How To Invest In Crypto Full Beginners Guide in 2021

Before you say good-bye to your dollars and hello to Bitcoin, Ether or Doge, there are a few things you need to know up front.

1. Cryptocurrency is unstable.

Its truecrypto is about as hot tempered as a 12-year-old. Its value swings way up, only to come plunging back down, and you never really know what youre going to get each day. The value of cryptocurrencies goes through extreme ups and downs. Theres no denying that some are really hot right nowbut for how long? Someone sneezes and the price drops! Investing in cryptocurrency is risky, to say the least.

But heres the crazy thing: A recent study by Piplsay shows that 50% of Americans think investing in cryptocurrency is safe.2 Fifty percent! News flash: Cryptocurrency definitely isnt a sure thingit carries a huge amount of risk. Lets be real here, all investing comes with some level of risk. But why jump all the way to the deep end with something this up and down?

2. Cryptocurrency has lots of unknowns.

Theres still a lot that needs to be ironed out with how cryptocurrencies work. Think about it: Nobody even knows who the founder of Bitcoin is! Only a small percentage of people in the world really understand the system and know how to operate it. Ignorance makes you vulnerable. We always tell people that if you cant explain your investments to a 10-year-old, you have no business investing in them to begin with. Youre setting yourself up for a big mess.

3. Cryptocurrency makes fraud easier.

Other Ways To Invest In Cryptocurrency

With broad adoption comes broad innovation, and there are now plenty of niche opportunities to acquire cryptocurrency.

If you would like to perform small tasks in return for cryptocurrencies, there are also plenty of options. Brave, a decentralized browser, rewards users for allowing advertisements with its native basic attention token . Coinbase promotes cryptocurrency education through its Coinbase earn initiative, which rewards users with a small amount of crypto after each lesson.

Airdrops free giveaways of cryptocurrency provide an opportunity to receive digital assets for free. Airdrops can be awarded for anything, although they often involve registration or promoting a new service, or they’re awarded retroactively for certain actions .

Video games are also exploring the integration of cryptocurrency, allowing you to earn cryptocurrency or NFTs while you play. Virtual worlds such as , which combine elements of gaming, art and social media, even let users buy and trade virtual plots of land, artworks, buildings and clothing. If you’re a digital designer, this could be a great way for you to earn a bit of extra income.

Thorchain Top Cryptocurrency To Invest In 2021

Founded in 2018, THORCHain is one of the unique coins that has been reached to $20 mark in just a few months. THORCHain is a decentralized liquidity protocol that allows users to easily exchange cryptocurrency assets across a range of networks without losing full custody of their assets in the process.

According to an official representative of THORChain, the platform has no CEO, no founder, and no directors. Instead, the further development of the platform is organized through Gitlab.

THORChain combines a range of novel technologies, including on-way state pegs, a state machine, the Bifröst Signer Module, and a TSS protocol to seamlessly facilitate cross-chain token swaps.

This is all kept behind the scenes, making the platform accessible to even inexperienced traders. The platform isnt profit-oriented. All fees generated by the protocol go directly to the users, and there are no provisions for the team.

These all uniqueness makes Thorchain a decentralized stable coin and top Cryptocurrency to invest in 2021 that can be beneficial both in the instant and long run. As per the analysis of the last few months data, Thorchain has given the best returns.

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Allocate Only A Small Percentage Of Your Portfolio To Cryptocurrencies

You’ll have to decide in advance how much of your portfolio you want to allocate to cryptocurrency. With recent advances, particularly in the price of Bitcoin, it can be difficult to make a rational decision. All investing is ruled by a combination of greed and fear, and it may be hard to keep the greed part under control given the advances cryptos have shown in recent years.

Up to this point, both the current uses and the future of cryptocurrencies are uncertain.

What Are The Main Attractions Of Cryptocurrency

Should You Invest In Cryptocurrency?

At the moment, it seems as if the two primary attractions of cryptocurrency are:

  • You can own and use it anonymously, and
  • It’s subject to price explosions that can make it look and feel like an investment.
  • And for those who bought cryptocurrency prior to the price explosion in 2017 or the most recent price increase in 2021, it’s probably been the best investment in a lot of portfolios.

    So what should you do if you want to get in on the cryptocurrency action?

    Recommended Reading: How To Start Buying Cryptocurrency

    A Safer Way To Invest

    The good news is that it’s still possible to get rich with the stock market — and even become a millionaire — without betting on high-risk, short-term investments.

    Although it may not be as exciting, taking a slow-but-steady approach is a far more effective way to build wealth in the stock market. This strategy involves buying strong stocks from healthy companies, and then holding those investments for as long as possible.

    Fundamentally sound companies are likely to grow consistently over time, and their stock prices will gradually increase. While these stocks may not experience explosive growth, you’re also less likely to lose money with this type of investment.

    While short-term investments like Shiba Inu may be tempting, they’re also incredibly risky. By maintaining a long-term outlook and choosing the right investments, though, you can gradually build a robust portfolio worth hundreds of thousands of dollars or more.

    Important Cryptocurrency Events For September 2021

    • 7th September. The President of El Salvador, Nayib Bukele, plans to pass his Bitcoin Law .
    • 12th September. Cardano plans to launch smart contracts.
    • 13th September. Eurex to launch Europes first Bitcoin futures product .
    • 24th September. Deadline for 20 crypto exchanges to cease operations in South Korea .
    • Late September. Thai SEC to propose new rules for digital assets.
    • Some point in September. Ripple and SEC to request discovery deadline extension to the 12th November .

    Recommended Reading: How To Buy Crypto Assets

    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.

    Choose A Trusted Cryptocurrency Ira Company

    Top 5 Cryptocurrency To Invest In For 2021| MASSIVE POTENTIAL

    There are three main benefits to investing with a Bitcoin IRA. First, you can save potentially thousands of dollars on capital gains taxes as your assets grow in value. Second, you benefit from peace of mind as your assets are insured and held in highly secure digital vaults. Third, third-party companies simplify an otherwise complicated cryptocurrency investment process.

    At this stage, its critical that you do your homework and identify a cryptocurrency company that suits your goals and needs. To make this job a little easier for you, weve put together a full guide to our readers top-rated Bitcoin IRA companies.

    If you want a short overview of each of our top picks, heres a short list of the top five U.S.-based companies that offer low-cost Bitcoin IRA services:

    • Regal Assets: 24-hour account opening service, best-in-class customer reviews, hacker-proof protection and theft insurance.
    • Bitcoin IRA: $100M in comprehensive insurance offered on all crypto wallets through Lloyds of London.
    • Coin IRA: Wide selection of cryptocurrencies on offer, including Bitcoin Cash, Ethereum Classic, Litecoin, and XRP.
    • Noble Bitcoin: Boasts top ratings from BCA and BBB customer satisfaction agencies.
    • BitIRA: Full-service provider offering instant, on-demand crypto trading.

    Also Check: What’s The Best Way To Buy Bitcoin

    Is Bitcoin Bad For The Environment

    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.

    Protecting Yourself While Investing In Cryptocurrency

    You must take extra steps to protect yourself and your capital with any investment type. There are a few common concerns when it comes to cryptocurrency: credibility, security, privacy. Many investors are skeptical of crypto platforms and are hesitant to start investing.

    A great way to mitigate these concerns is by thoroughly researching the crypto you want to invest in and whats behind the platform. Look up who owns the marketplace you are interested in and gather more information about them. Research how old the company is and in what stage of development the platform is in.

    Cryptocurrency is unfortunately susceptible to hackers and other technical issues that simply dont impact other investments as frequently. For this reason, it is crucial that you fully understand the marketplace you choose to work with.

    It is not uncommon to choose platforms high profile investors are known to work with as a starting point. This, along with a sound company structure, can help serve as a sign of stability for that marketplace.

    As you continue to learn how to invest in cryptocurrency, take the initiative to read the fine print before you start an account. The companys prospectus will provide you with insight into the companys inner workings. This information can help provide you with peace of mind and let you know exactly how secure your investment will be.

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    Read The Projects Whitepaper

    When youve found a cryptocurrency you like, the first thing you need to do is read the whitepaper.

    A white paper is an authoritative report or guide that informs readers concisely about a complex issue and presents the issuing bodys philosophy on the matter. It is meant to help readers understand an issue, solve a problem, or make a decision.

    Reading the whitepaper will give you two tremendous benefits:

  • You, as a potential investor, will learn everything you need to know about the cryptocurrency and the value that its bringing into the ecosystem.
  • A poorly written whitepaper is often a sign that the project is not worth investing in. If the team behind the cryptocurrency cant adequately explain the true utility of their token, then its probably not worth supporting.
  • Pros: Why Investing In Compound Could Be A Good Idea

    5 tips when investing in cryptocurrency

    Compound has been busy levelling up in the crypto-lending industry launching their new Compound Treasury, a service strictly for financial institutions where they can earn 4% fixed interest per year by investing US dollars.

    This will provide a massive amount of liquidity to Compound and fuel its crypto-lending services. And with the interest in DeFi exploding in 2021, the Compound Treasury looks like a top investment for institutions.

    With all this extra liquidity at their disposal, Compound could essentially become the bank of the crypto world.

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    Maintain A Healthy Crypto Portfolio

    Keeping a healthy portfolio means creating your core investment, and making sure you diversify by adding in a number of satellite investments. This helps to even out your returns as the winning picks offset any losing picks.

    This is true of diversifying your entire portfolio by including cryptocurrencies and its true of the crypto portion too. By adding a number of different cryptocurrencies youre diversifying your risks and spreading your exposure to a broader mix of assets.

    While this type of diversification means youll almost surely have some losers in your portfolio its far better to lose a few while winning some rather than losing it all because you kept all your crypto investment in one coin. You might not get the eye watering returns of a single rocketing coin, but you also wont risk losing everything if the coin you pick crashes and burns.

    Never Invest What You Cant Lose

    When you first start investing it can be very exciting, and even addictive for some. This can be especially true if your first purchases occur during a bull run, when everything is heading massively higher. You might think things will be like that always, and that can lead to over committing yourself and your capital.

    Experienced investors know that there is always an element of risk in any investment. While some do have lower risks, the cryptocurrency class has some of the highest risks youll find. That means cryptocurrency investing should be approached carefully. Start with small amounts and grow your account slowly. And most importantly dont use money you need for rent, food, or other necessities.

    For some reason there are those who feel like they need to purchase 1 BTC or 1 ETH. This simply isnt true. You can get started with cryptocurrency investing using as little as $10. Brokers and exchanges will let you purchase just 1 satoshi, which is the smallest fraction of Bitcoin and is equal to just one hundred millionth of a single bitcoin .

    Start small and slowly build up your crypto portfolio over time is the prudent course.

    Recommended Reading: How To Buy Bitcoin With Apple Pay

    Why Is The Crypto Market Going Up In Value In 2021

    Whenever you want to know why the crypto market is going up in value, follow Bitcoin and you will always find out why it is either rising or falling.

    Bitcoin was already on a bullish path in late 2020 with many speculating it was the result of increased investor interest. But in 2021, Elon Musk has been one of the most influential people in crypto.

    But what made the crypto market go crazy in 2021 was when Tesla purchased $1.5 billion in BTC and planned to start accepting it as a payment method.

    More recently, Bitcoin started to ascend upwards again to $45 when Amazon put out a job post for a Digital Currency and Blockchain Product Lead. Very quickly rumours started to spread that Amazon might start accepting Bitcoin .

    How Do I Protect Myself

    How To Invest in #Cryptocurrency: Super Beginners Guide

    If youre looking to buy a cryptocurrency in an ICO, read the fine print in the companys prospectus for this information:

    • Who owns the company? An identifiable and well-known owner is a positive sign.

    • Are there other major investors who are investing in it? Its a good sign if other well-known investors want a piece of the currency.

    • Will you own a stake in the company or just currency or tokens? This distinction is important. Owning a stake means you get to participate in its earnings , while buying tokens simply means you’re entitled to use them, like chips in a casino.

    • Is the currency already developed, or is the company looking to raise money to develop it? The further along the product, the less risky it is.

    It can take a lot of work to comb through a prospectus the more detail it has, the better your chances its legitimate. But even legitimacy doesnt mean the currency will succeed. Thats an entirely separate question, and that requires a lot of market savvy.

    But beyond those concerns, just having cryptocurrency exposes you to the risk of theft, as hackers try to penetrate the computer networks that maintain your assets. One high-profile exchange declared bankruptcy in 2014 after hackers stole hundreds of millions of dollars in bitcoins. Those arent typical risks for investing in stocks and funds on major U.S. exchanges.

    Read Also: How To Pay Crypto Taxes

    How To Invest In Crypto Without Buying Coins

    The easiest way to get investment exposure to crypto without buying crypto itself is to purchase stock in a company with a financial stake in the future of cryptocurrency or blockchain technology.

    But investing in individual stocks can bear similar risks as investing in cryptocurrency. Rather than choosing and investing in individual stocks, experts recommend investors put their money in diversified index funds or ETFs instead, with their proven record of long-term growth in value.

    Believe it or not, most individuals with a retirement plan or an investment portfolio allocated in an index fund already have some exposure to crypto, says Daniel Johnson, a CFP with ReFocus Financial Planning.

    Many of the best index funds like S& P 500 or total market funds include publicly traded companies that have some involvement with the industry by either mining crypto, being involved in the development of blockchain technology, or holding significant amounts of crypto on their balance sheets, says Johnson.

    For example, Tesla which holds over a billion dollars in Bitcoin and accepted Bitcoin payments in the past is included in any funds that track the S& P 500. Since its 2020 inclusion, its become one of the most valuable, and therefore influential companies in the index. And Coinbase, the only publicly traded cryptocurrency exchange, is in the ARK Fintech Innovation ETF.

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