Since its inception in 2009, cryptocurrency has kept on growing. It is an ever-changing and constantly evolving part of the digital economy. Before we get more into cryptocurrency, let’s understand what it is.
Cryptocurrency is digital or virtual money, and it is not centralized to any particular company, state, or country. Many cryptocurrency networks are based on distributed online ledgers called blockchains, and it is available to everybody around the world.
People have gone from rags to riches thanks to the cryptocurrency sector. Simultaneously, we have seen others lose more than half of their money. It feels crazy how a small action can easily reverse the market in seconds. This volatile and uncertain nature of the crypto market has many crypto traders, even the pro ones, doubting their investments.
Indeed, the market is unpredictable. But that doesn’t mean you should sit back and watch others reap the benefits.
Here are a few tips to help you start your crypto journey:
Look into the top three cryptocurrencies out there
Here is a short overview of the top three crypto-coins out there:
Ethereum: It is the most popular blockchain, and Ethereum was the first-ever programmable blockchain. Ethereum makes up the majority of all dApps and 63% of all DeFi assets. This makes Ethereum a well-recognized coin.
Lucky Block: Lucky Block is said to become the most popular cryptocurrency in 2022. Lucky Block is launching a decentralized lottery-based blockchain. To make things even more random, smart contracts are used as lottery tickets on this platform. No matter where you are, you can play. The winners get their money right away, no matter where they are.
Decentraland: Decentraland is a decentralized project that houses a 3D gaming universe. The main concept behind this project is that it allows users to purchase virtual plots of land, which are viewed as non-fungible tokens.
Do not store your cryptocurrency online
When it comes to storing and keeping your cryptocurrency safe from hackers, it’s best to keep them offline: on a hard disk. Keeping your crypto assets online may be convenient, but it has a high chance of being stolen by hackers. The best thing to do in this situation is to hold approximately 80% of your assets on a hard drive and the rest online for you to use when needed.
Look into crypto loan
Crypto loans are considered secured loans where you use your assets as collateral to get the financing. In crypto loans, you offer your cryptocurrency as collateral to secure the loan. Even if you don’t pay back your loan, your creditors will sell your crypto assets to pay off your debt.
Taking out a crypto loan makes sense when you have a substantial number of crypto assets. You can use this loan to buy things, invest, or even use it for your own needs. When you’re struggling with debts or wondering how to consolidate your multiple payday loans, credit card debts, and medical bills, crypto loans might be an excellent option to pay off your debt.
The big problem with crypto loans is that, due to its volatile nature, if by any chance the value of your cryptocurrency drops, then the amount you pledged for the loan will come down. Therefore, it’s better to put more assets up for collateral to maintain your pledged amount if any issue arises.
Try copy trading
Just like the name suggests, this is a form of investment trading where you copy professional traders. When you copy trade, you link your account to the trader you want to copy, so whenever they invest, you automatically do the same. Pionex, eToro, and Shrimpy are great platforms for copy trading.
Focusing on one or two large-cap stocks is good, but spreading your money among different stock ranges is better. The main idea of diversifying your crypto portfolio is to control the effect of extreme outcomes. Buying small cap or medium cap stocks can not only help you spread out, but if any of the other stocks tank due to some minuscule action, then you don’t have to suffer a lot of loss because you have additional assets making money for you.
One-half of the ideal crypto trader’s portfolio consists of large-cap stocks like Bitcoin or Ethereum. The other half comprises an amalgamation of small-cap and medium-cap stocks.
Have a Stop-Loss Order
When you enter the crypto market, controlling the adverse outcomes is an essential component of your arsenal. A stop-loss order is a form of advanced order that traders use to avoid further losses.
It is necessary to have an exit plan while entering a trade market. Having a precise stop loss level might assist you in limiting your losses, which is something that most traders lack. Setting a stop loss at the value of your coin is the best way to go.
For instance, if you buy a coin for $1,000, you should set that as the base price at which you’ll exchange it. Because of this, even if everything goes wrong, you’ll still get your money back.
We must exercise extreme caution when making cryptocurrency investments and only do so through reliable organizations that operate legally. The blockchain-based approach is cutting-edge and revolutionary in the field of finance. These cryptocurrencies’ low fees and quick transactions make them particularly appealing to investors of all kinds. Peer-to-peer transactions can only be secured if the transaction is entirely secure. It is impossible to forecast the future of cryptocurrency in these current circumstances with any certainty. However, one thing is for sure: decentralization is the wave of the future, and cryptocurrencies are poised to lead the charge.
Lyle Solomon has extensive legal experience as well as in-depth knowledge and experience in consumer finance and writing. He has been a member of the California State Bar since 2003. He graduated from the University of the Pacific’s McGeorge School of Law in Sacramento, California, in 1998, and currently works for the Oak View Law Group in California as a principal attorney.
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