Bitcoin as well as other cryptocurrencies have made quite the splash throughout the world. The hype surrounding Bitcoin has died down quite a bit within the past year, but there are still plenty of conversations happening that involve words like crypto, blockchain, cyber money, and of course, Bitcoin.
If you’re considering taking a leap into the world of crypto, tread cautiously. Before you buy Bitcoin with cash, follow these tips for cryptocurrency investments.
Tip #1: Study Up
Before making any investment, it’s important to do your research. This is especially true if you are just entering the crypto market and don’t know much about it. The more you understand about cryptocurrency, the better off you will be when making your Bitcoin purchases.
Bitcoin investment offers tons of opportunities, but first you need to fully understand it. You should also look into other cryptocurrencies – there are tons to choose from like Ethereum, Litecoin, and Dash – to see which one makes the most sense.
Tip #2: Remember the Risk Involved
You need to remember that investing in Bitcoin is essentially gambling. You are taking a risk and gambling on whether or not the value will go up, down, or remain the same. Experts say that crypto is an extremely high-risk investment choice, but without taking the risk you won’t experience the reward.
In order to not lose out too much, try to put your eggs into more than one basket. Start out small by investing a small amount in Bitcoin as well as other cryptocurrencies to see which one takes off and leaves you rich.
Tip #3: Diversify
This goes along with what we just told you. It can be very tempting to put all of your money into Bitcoin, since it is the most popular and most well-known currency out there, but try to avoid this. It is a much better strategy to diversify, just as you would do with your stock portfolio.
When investing in the stock market, it is never a good idea to dump all of your money into one company. Diversification is key and it often results in the most profit. Spread out your funds across several currencies.
Tip #4: Keep Coin Assets in Legit Wallets
There are tons of ways to purchase Bitcoin. The list of crypto exchange sites continues to rise, but do your best to move your funds to an online wallet instead. It is certainly an option to keep your coins within your account on the exchange site that you used, but transferring it to a wallet is a better idea for a few reasons.
Moving your coins to wallets like Jaxx rather than keeping them in exchanges like Coinbase is a much more secure option. Manage digital currencies as you would real paper money. One Bitcoin expert says that “just like you keep some cash in your wallet, some in your bank account and perhaps the really valuable stuff in a safe, you need to manage digital currencies in the same way.”