Welcome to the world of cryptocurrency investing. It’s a little wild and crazy yet, but there’s no going back now. Digital currencies are here to stay and many people like you are drawn to them, even if you’ve never had any trading experience.
This creates a unique situation because crypto traders can instantly start trading online in hundreds of places. Meanwhile, social media is saturated with people who will tell you what to trade, what to buy, what to sell. Many of them are just shilling or getting paid to promote a project, regardless of how shabby it is. So how do you know what is really a good cryptocurrency project that is worth your investment?
Learn how to determine if a cryptocurrency project is good
With over a thousand ICO projects emerging in 2018, it became quite the trick to distinguish between a quality project and a complete scam, not to mention all the areas in between. But as a new crypto investor, there are many ways that you can get the info you need to figure out if a project is worth investing in.
- Conduct Your Own Research – Read the whitepaper, website and a few of their social media feed. Pay special attention to the abstract (or executive summary) of the white paper, which really gets down to the heart of the project’s idea. Look for clues that the market is ready for whatever product or service they are offering.
Then check out the team’s profiles on LinkedIn and wherever else you can find them. Have they been involved with other startups? What was the outcome? Don’t forget to check for a well-rounded team, with developers, marketers, industry-specific experts, and experienced leaders.
- Subscribe to an ICO review service. While it’s always good to do your own research, it’s also nice to know that someone else has vouched for the project in question. Additionally, you may gain some insights that you didn’t draw in your own research.
Know the Risks of Cryptocurrency Investing
As active as the crypto market has been during the last year, excess volatility hasn’t quite ironed out yet. Until then, just know that cryptocurrency prices are going to fluctuate, at times wildly. Hold on to your coins if you can for the long term.
Another risk involves exchanges. A good general rule to follow is to make sure you own your crypto. If you don’t possess the keys to your crypto wallet, then a 3rd party exchange is actually holding that crypto and not you. Exchanges that are holding everybody’s seed phrases (keys) are by and large completely unregulated at this point. Plus, they pose a nice target for creative hackers.
Those exchanges that are regulated aren’t much better, because essentially they act exactly like a bank, which has a single point of failure. Using a 3rd party to hold your cryptocurrency pretty much defeats the purpose of a decentralized, encrypted, currency.
In a nutshell, keep your crypto offline, out of a 3rd party’s hands and secure. To do so, use cold storage such as a hardware wallet or a paper wallet.
If someone offers you free coin, be suspicious. Unless it’s through an airdrop that’s officially announced on the project’s website, it’s probably best to ignore. If you do participate in an airdrop, double check that the web link you are interacting with is the project’s website.
Try a Social Trading Platform
If you’re a complete newbie yet gung-ho about becoming a crypto trader as soon as possible, you could try out a decentralized social trading platform. In social trading, the emphasis is on real-time data and crowd knowledge. Plus, it provides an environment where users can learn from expert traders.
If you plan on doing a lot of
You may not plan on day trading or earning crypto by making trades. In that case, it’s still a good idea to track your data so you can spot trends. A few crypto trading tracking services have also popped up in the past year that can help, including Bitcoin.tax.
For all those new cryptocurrency investing, the market is starting to mature and more and more tools are available to help you climb the learning curve. Join us today to receive more news and updates about super fast and sleek crypto trading app!