A study by Exploding Topics reveals that the global number of cryptocurrency users has surpassed 1 billion, with 24% of millennial parents in the US owning cryptos. Today, you can use cryptos to purchase almost anything, including a brand-new Tesla car. You can also play blockchain games and enjoy faster and cheaper transactions at casino sites worldwide.
If you’re considering diving into the crypto world, keep in mind that it’s a highly volatile sector with technical complexities. The good news is that you can follow some core principles to succeed in investing in cryptos. Below are a few beginner tips to follow:
Tip #1: Understand the Crypto Industry
Start by gathering all the necessary info about the industry. The idea is to get crypto knowledge and build excitement and passion. Note that the crypto sector has experienced several events like Bitcoin mining and spot ETF approval, which can have a significant impact.
Here are some proven ways to gather info about the crypto industry:
- Read crypto news articles and blog posts.
- Watch crypto vlogs by expert traders and investors.
- Follow crypto experts like Elon Musk and Vitalik Buterin on social media.
- Befriend other investors to get industry data and trading tips from them.
Tip #2: Avoid Emotional Investing
Focus on the bigger picture, and keep your emotions in check. All your crypto trading decisions should be data-backed. For example, some rumors can affect the value of major coins. In such scenarios, keep calm and avoid panic selling. Only trade your cryptos when the conditions are right.
Another surefire tip to avoid making emotional decisions is leveraging AI technology. Today, many investors use AI bots to analyze massive data and execute trades. These bots make decisions strictly based on the analyzed data. So, use AI bots to make more accurate decisions.
Tip #3: Invest What You Can Lose
Don’t jump into crypto trading without setting aside capital. A trading budget is vital because this industry is still new and extremely volatile. Usually, crypto trading is clouded with skepticism, meaning nothing is certain. It’s therefore wise to have a budget you can lose if the worst happens.
While at it, don’t put all your money into a single market. Instead, diversify into stocks, fiat currencies, or even futures. Also, don’t invest more than 5% of your total portfolio in cryptos. This way, you can limit the impact of losses and start again if you lose everything.
Tip #4: Leverage NFT Airdrops
Airdrops are free crypto tokens given to investors who complete simple tasks like completing a certain amount of trades or inviting friends. These tokens create awareness about new projects. You can invest, trade, or convert them into cash.
That said, airdrops provide valuable hands-on trading experience on platforms like Binance and Bitget. It’s more like receiving a reward for simply exploring the cryptocurrency market. So, use them to experience a practical and risk-free way to learn the ropes in crypto trading.
Tip #5: Protect Your Coins
Lastly, always take proactive measures to protect your digital assets.
A CNBC report reveals that hackers looted $1.38 billion worth of cryptos between January and June 2024. That’s $654 million more than what was stolen at the same time last year. This worrying trend reminds you that crypto security should feature in your investment strategy.
Here are a few security measures you can take:
- Create a strong, 16-character wallet password.
- Choose a hardware wallet whenever possible.
- Enable 2-factor authentication (2FA) on your wallet.
- Regularly check your crypto wallet.
- Trade or exchange your digital assets as soon as possible.
Endnote
There you go. These are some of the essential rules to master before investing in cryptos. Remember, the goal is to blend knowledge with strategy effectively. This allows you to confidently invest in cryptos and embrace the inevitable setbacks with a smile. All the best!
