Top 7 You MUST Know Before Investing Into Crypto Currency

Crypto currency recently take the world by storm and it’s demand is rocket high as the market cap believe to reach trillions soon. and if you happen to be one of those people that want to invest your money into crypto currency market, you need to consider the following:

1- Crypto currency have no backup and no classical value.

Unlike normal currency crypto-currency have no backup that means it has no valuable assets as a back-bone such as gold or diamonds. Classical or normal daily currencies all have back-up that the value of currency depend on the economical state of the country and how much gold or other valuable assets that country owns.
Normally something like dollar has a value and that value can be analyzed by how much gold you can get with the currency and how the country take care of their financial state .

But in crypto case they don’t have that which means they are valuable because you feel like they’re valuable otherwise they’re just a normal chain of numbers in your digital wallet.

2- Crypto-currency eco-system mostly depend on bitcoin.

It is clear that Bitcoin is the very first and the most well-known currency in the world and it is the reason that we have multiple thousand types of crypto-currencies now .
So if you are planning into any type of crypto you need to consider Bitcoin because if Bitcoin price fall, every other type of currency price will follow and vise-versa.
This is not %100 true sometimes but majority of the time you need to be able to predict Bitcoin price even if you’re willing into other crypto-currencies.

3- Don’t invest more than %10-20 of your money.

If there is anything clear about crypto-currency market it have to be that they are very very unstable .
So investing all of your time and money into crypto-currency will put you in a position of gambling that means you could either win it all or lose it all.

So as basic rule of thumbs you should initially invest only 5-10% of your money and as you become more familiar with the market, we suggest to increase your investment only to %20 of your hard earned money.
And if you’re lucky enough to make profit out of it you can re-invest the earned profit into it again .

4- Before purchasing any coin make sure to read its value history, maximum capacity, market cap. And its hashrate.

You need to know value history of the coin because you need to know how many downfall and high peaks the coin reached in the past so that statistically you have a clear vision of the way this coin value changes of the course of time especially if you are planning for long term investment .

Also the maximum capacity of any coin can tell you what’s the maximum amount of the coin that could be earned or mined over the course of time .
Coins that have no maximum capacity can be mined infinitely which over the course of time this coin could lose its value due to high number of supply and low demand .

Coins with limited capacity can be mined up to the specified amount that means the coin has less risk of losing its value over time because the supply is limited, which can be very helpful if you are planning for long term investment.

Market Cap. Shows the total money that people invested into this currency.
Usually cryptos that have higher market cap. are less risky because a lot more people are believing in the coin and are willing to back-up the coin through peaks and troughs, so it’s less likely that the coin will be losing value dramatically.

Hashrate mean how many hashes you have to mine before receiving 1 unit of the coin.
So basically coins with higher hashrate are requiring more hashes to be mined thus are more difficult to get .
So basically if you are willing to invest into crypto-currencies, buying a coin with higher hashrate is less risky and if you’re willing to get some low hashrate coins we suggest mining them instead of purchasing.

5- Before purchasing any crypto-coins, try to read tech experts and tech companies on it.

It’s clear that crypto-currencies are created, evaluated, managed and traded mostly by tech companies and tech enthusiasts. So the last thing you want to do is investing into a coin that is not created by someone with unknown history or well reputation.

You also need to also hear others especially tech enthusiasts, tech companies, opinions on the coin.
If you need safe investment in crypto-market, you want to make sure that the creator is well-known and the tech companies and tech enthusiasts are believing and willing to invest into the coin.

6- Don’t invest into crypto-currencies if you don’t have enough time or energy to continuously check crypto-markets.

Crypto-coins value can change by minutes or even seconds, so before investing your money into any coin please make sure that you have enough time and energy to check the crypto-market at least 5-6 times each day.
Because if you don’t, you may just lose a big opportunity to make big profits or you may lose the chance to sell your coins before they lose their value dramatically.

7- Before purchasing any crypto-coins, make sure that you have a well prepared and well secured wallet.

Crypto-wallets are one of the key of crypto-currencies investment.
So before purchasing any coins YOU MUST make sure that your wallet are secured and prepared and ready to keep your coins.

Because unlike normal currencies, crypto-coins are not backed-up by governmental records so this make coins vulnerable if you don’t have secured wallet, because once you lose it you can’t get it back.
You may somehow heard the story of a man that forgot the password of his wallet that contains over 300 million dollars’ worth of Bitcoin.

Overall you need to take your time and study well before investing into any coin because it’s a very fast market with the possibility of big profits and big losses.

Written by Shko Faraj Agha

Adventures Pharmacist, Tech Influencer, Entrepreneur

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