How to invest in cryptocurrency

How to invest in cryptocurrency

Contents of this article:

Investing in a new and unfamiliar asset, without assessing the risks and prospects, the investor may be left without start-up capital. If you are already actively interested in the industry and want to learn how to start investing in cryptocurrency , study the market. Do not rush to invest all your money in popular coins or cheap but fast-growing assets.

Benefits and risks of investing in cryptocurrencies

By investing in cryptocurrency in Ukraine , you can earn in one of two ways – buy and hold until the capitalization of the asset grows, that is, its price, or profit from borrowing digital currency. The most common, simple and understandable way for beginners is to buy and hold an asset in an investment portfolio.

Benefits of investing in crypto:

  • High yield. The price of digital assets is constantly changing, the yield can be several hundred percent.

  • Active development of the industry. The cryptocurrency market is developing faster than all other financial markets. More than 60% of its capitalization falls on Bitcoin , but besides this popular coin, there are many other promising investment projects on the market.

  • Ease of investment and low entry threshold. Anyone can buy cryptocurrency by registering on one of the many exchanges. To start investing, you do not need to have a large start-up capital. With only a few hundred dollars, you can start exploring the field and invest in promising coins.

There are also disadvantages to investing in crypto:

  • Volatility. Due to the rapid change in the exchange rate, the investor always runs the risk of losing money. In order to save investments, it is important to invest not in one, but in several coins with a good prospect, as well as carefully monitor the state of the market and “throw off” an unnecessary asset in time.

  • Safety. Despite the efforts of top exchanges to make the system as secure as possible, hacker attacks are still possible, and sometimes investors lose their money irretrievably, becoming victims of scammers.

  • No guarantees. Each investor can both earn and lose money. When investing in cryptocurrency , you must understand that its rate depends on supply and demand, so it is difficult to accurately predict how successful the investment will be.

How profitable it is to invest in cryptocurrency for a beginner: choosing a coin

Today, experienced market players are selecting promising infrastructure projects. First of all, it is Bitcoin , the very first cryptocurrency coin, the most popular and in demand in the world. In addition to Bitcoin, popular crypto projects include Ethereum , Solana , Polkadot , Avalanche , Litecoin and others. These are coins that can be bought for long-term holding.

When choosing a crypto for initial investment, you should give preference to popular coins, paying attention not only to capitalization, but also to a number of other factors:

  • frequency of code updates by developers;

  • the scale of the project community;

  • marketing.

Study the essence of the project in which you are investing, follow company news and changes, keep abreast of the latest news, be interested in insiders.

Investments in cryptocurrency today: risks and prospects

If you are just diving into the field and thinking about how to start investing in cryptocurrency from scratch , do not rush to invest money until you learn the basics of the market and understand popular coins.

When investing, remember a few rules:

  • The exchange rate of most cryptocurrencies depends on the price of Bitcoin , since this particular coin dominates the market. When choosing assets for investment, keep an eye on Bitcoin and other top coins.

  • The rate of cryptocurrency can rise sharply and fall just as sharply. Always take into account the risks, invest as much as you are not afraid to lose irretrievably in case of an unsuccessful investment.

  • Don’t start investing in crypto without an investment plan. Think over a portfolio diversification strategy, choose a promising asset, decide how much you are willing to invest, how quickly you plan to get the first profit.

Learn more about how to safely invest in cryptocurrencies in the Crypto Community Crew and on our course. We teach how to work with crypto effectively, offer only up-to-date data and help build a working strategy for making money from scratch.