Investing in cryptocurrencies may have some similarities with waging bets because of the extreme volatility of the digital currency, which is evident for a new technology that takes time to stabilize. Changes in Bitcoin value, Ethereum, or Ripple, some of the leading cryptocurrencies, can make investors win or lose a large sum of money in a noticeably short time. Trading of any kind comes with its risks and uncertainties, and dealing in cryptocurrencies is no different. Besides market volatility, there are other dangers too that investors must be aware of and learn to avoid it by applying their mind to the process. They must understand the triggers of risks that are very much avoidable, feel Eric Dalius, who has some good experience about investing in cryptocurrencies that have been one of his professional ventures.
Here is how you can take the right steps to keep your investment protected and even make it grow.
Create a diversified portfolio – advises EJ Dalius
Do not make the mistake of putting all your eggs in one basket. Instead create a diversified portfolio of investments no matter whether you trade in stocks, whether you trade in stocks and equity, gold, or cryptocurrency. As a crypto investor, mind that all currencies do not have the potential of making it, so it is sensible to spread out your choices. Moreover, do not direct all your investments into cryptocurrency only but channel it toward the different asset classes to minimize the chances of losses.
Ensure system security
Hacking is the biggest threat faced by cryptocurrency investors, as many have learned the hard way. All cryptocurrency investments are attractive for hackers who pose a serious threat. To investors who must protect their computer systems to the best of their ability. Store your data correctly and ensure that you do not part with. It even inadvertently and this should keep your investment protected. Install effective security software in your computer system to make it impregnable for hackers. Create several wallets to store your cryptocurrencies and store the wallets offline at someplace other than your computer.
Research well before investing in ICOs
Cryptocurrencies use ICO or Initial Coin Offerings to raise funds from the public. It has become a way to prey on the unsuspected and vulnerable investors. According to experts, many of the ICOs are high-risk speculative investments that you must deal with enough caution. ICOs have the least consumer protection and a high potential for fraud, along with high volatility. Do extensive research before putting your money in any ICO project. Only experienced and seasoned investors can evaluate ICOs correctly.
Time it right
As a cryptocurrency investor, you must learn to stay immune to the fear of missing out. Just because some of your acquaintances made money from some cryptocurrency does not mean that you must rush to it. When you learn. That many investors have made it, maybe the time has run out to jump in as you are late.
To time your investment right, do proper research, have a good. Understanding of what you are investing in, and make an appropriate assessment of potential loss.
