Cryptocurrency is simply known as digital currency. Currency is anything globally accepted as a medium of exchange, it doesn’t have value if it isn’t ascribed to it. Currency has evolved from gold & silver to notes and presently cryptocurrency.
However, is crypto a gold mine?
Generally, cryptocurrencies have enjoyed a share of controversies starting from their availability to when it was made public in 2009 because cryptocurrency existed before bitcoin. The value ascribed to it made it valuable and a medium of exchange. Hence, more coins and tokens.
Each coin or token created must solve a problem and more importantly a medium of exchange before people ascribe value to it. Unfortunately, this was hijacked and turned into a speculative asset. The reason why some see it as a gold mine.
If crypto is regarded as a gold mine, why is it controversial?
The questions mentioned above are what lead to the objective of this content, newbies have to understand the basics which are discussed subsequently.
Learn!
This is simple but overlooked and underrated. Some people invest in Cryptocurrency reason due to their friends made a thousand bucks. Eventually, when capital is lost you can guess what their comment would be.
To succeed in the cryptocurrency world, you must understand the learning aspect. There are many categories or aspects you need to learn about which will be explained clearly. So keep up reading.
Filter the Noise
You need to filter the noise and pick the GEM. You fail in cryptocurrency when you can’t curb noise and greed. Noise act on emotion clouds your judgment and greed fuel it up. Filter the noise properly before you should invest.
*Narration: does the coin or token follows the present narration in the crypto world? Presently, AI (artificial intelligence) is one of the narratives in the crypto space but the narration isn’t enough.
*What problem does it solve? Ethereum created Smartchain, and Binance solved the problem of gas fees. Crypto must provide a solution to a problem.
*Team: do you know the team members? Are they credible? Do they have the experience needed? Do they have another source of income or revenue apart from sales of their coin or token?
*Community: note! A dead community is a dead project. The project community is to be organic. Some coins flourish majorly because of their communities. Check out their social media outlet, and access how they interact with their communities to know if trust exists.
No doubt, you’ve gained insight on what to research before you delve into investing or trading a coin.
Do Not Buy Green Candles
Basically, “Green” means the bull market or when the coin value is appreciating. Mostly, this caused FOMO (fear of missing out). Don’t buy the green candle. This goes down to “learning”. Both fundamental and technical analyses are needed. You can’t skip TA especially when you aim at trading. And a simple piece of advice, the best time to buy is in the bear market because a strong project will stand out.
DCAing
DCA is simply put as Dollar Cost Averaging. An investment strategy you need to imbibe to be successful. I will be practical here.
For instance, Bitcoin is at $35,000 and you have $1000, after doing “your research” you invest 200 dollars. Two weeks after the price fell to $25,000. You invested another $200. A few weeks after, the price dropped to 19K you invest another $200.
One Basket Error
Don’t invest in one project but it doesn’t mean you should invest in hundreds of projects. Between two to five is okay if credible. Investing in hundreds of projects doesn’t guarantee success, however, two strong projects can do that.
Long-Term
The long-term mentality is good but learn to take profits.
I will be practical again, assuming you wanted to invest $100 in a coin after you have done the research. You can invest $200 and when the price increases you take out $100 with profit after which you leave what remains
I will explain better. If $100 can buy 0.05 units of a coin and you invested $200 [0.1 unit of a coin]. When it has appreciated, you take out 0.05 which is $100, and profit. You can also take it by percentage if you don’t like the method I mentioned.
CZ once said (paraphrased) you can only be rich when you HODL – hold on for dear life. But this is only for good projects.
See you soon and thank you.
Personal Note From MEXC Team
Check out our MEXC trading page and find out what we have to offer! You can learn more about crypto industry news. There are also a ton of interesting articles to get you up to speed with the crypto world. Lastly, join our MEXC Creators project and share your opinion about everything crypto! Happy trading!
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