4 Things No One Will Tell You About Cryptocurrencies

Here's a guide that will take you through some important things to know before investing in any cryptocurrency.

Cryptocurrency investments are similar to foreign exchange. In a way, Bitcoin, Ethereum, and Dogecoin are like "foreign currencies" that are suitable to a particular context in the digital community. If the crypto buzz around you is convincing you to make an investment and reap the benefits of the spiking prices, there are some things you need to know to make the right analysis.

People speculate on the validity of cryptocurrency. Rightful questions like what can one buy with bitcoins come up whenever there is a discussion on crypto investment. Currently, cryptocurrency is majorly just an investment though a few companies are legitimizing crypto transactions to buy their products/services. Major businesses like Starbucks, Tesla, Tesla, Amazon, PayPal, Microsoft, etc. are the first ones to accept Bitcoin payments. This is an indication of a possible future where cryptocurrency will see a wider acceptance. So if you want to be future-ready, make a note of these points.

4 Things To Keep In Mind Before Investing In Cryptocurrency

1. Cryptocurrencies Are Unpredictable

Just like stock prices, the value of crypto coins like Ethereum and Bitcoin is volatile in nature. In 2017 the value of one Bitcoin was ranging from $900 to $20,000. Early this year, Bitcoin saw its highest price spike to $63,000 and the latest price today is $56,000. So don't be hasty in making the decision, observe the charts for a few weeks and then invest in the right cryptocurrency. Remember, there is more to crypto than Bitcoin.

2. Don't Ignore The Ambiguity

What we know about cryptocurrencies is just the tip of the iceberg. There's still a lot of ambiguity regarding how crypto coins work. It's common knowledge in the tech world that cryptocurrencies work on blockchain technology but the common public has little to no understanding about this. So before you jump to put in all your money, research and understand it thoroughly.

3. It's Possible To Fall For A Crypto Scam

Scammers who want to hide from banks and the government can use crypto to make shady transactions on the black market. So if you ever intend to buy/sell things to another person who has cryptocurrencies, beware of their intentions. Not all crypto investors are scammers but there's a chance they can be.

4. There Aren't Any Regulatory Standards Yet

It's like a gamble. Cryptocurrency transactions happen peer-to-peer without any link to regulatory standards. Unlike stocks, you cannot calculate returns when the value rises and falls. Remember this when you are creating a long-term investing plan backed by cryptocurrencies.

What's The Bottom Line?

At this point, if you're wondering whether to invest in cryptocurrencies or not, here's the catch. If you don't have any debt, have enough liquid funds to fall back on for at least 6 months, and have a diverse stock market portfolio, then you can risk investing in cryptocurrencies. But do that with thorough research and analysis. To start off, you would need a good cryptocurrency exchange. Here's the information you need about it.