How to Invest in Crypto Safely


Cryptocurrency is considered a high-risk investment due to its volatility. Any day, a crypto coin could be overvalued, experience a rise, or see a dramatic fall. New crypto-coins hit the market every day. Some are deemed as emerging cryptocurrency to watch, while others sputter, stumble, and eventually fail.

Investing in crypto safely starts with a few basic rules and building from there. Cryptocurrency recommendations may change day-to-day, but your investment strategy can be consistent. At all times, you are looking to minimize risk and invest smartly based on data or research. Remember to only invest with money you can afford to lose because there is no guarantee of a return with cryptocurrency.

If you want to be a Bitcoin investor or cryptocurrency trader, here is how to maximize earning potential safely:

Acknowledge the Risk

Every crypto coin, even Bitcoin, is a risk. At any given time, Bitcoin is falling or climbing, despite the long-term growth behind it. Risk exists everywhere with cryptocurrency, so you cannot be overly cautious with your investments. Instead, make conscious choices based on what coin yields the best returns proportionate to its volatility. Due to the risks involved, only invest with money you won’t be distraught losing.

Not All Crypto Coin Is Equal

Before walking up to your Bitcoin ATM, you should know what coin you’re buying. You do not want to invest without a plan. Not all cryptocurrency is equal. Some will be dramatically overhyped, while others will be bubbling on the surface, ready to cross over and spike. However, cryptocurrencies can also be stagnant, remaining where they are with almost no fluctuations.

Adopt a Long-Term Strategy

To make the most of your return with crypto, invest for the long term. If you want to make a killing within six months in the cryptocurrency game, your risk jumps up a lot. Trying to make that short-term gains is going to be a challenge. A long-term strategy will mean you’re more likely to purchase crypto when it’s low and sell when it’s high. When investing, you want to feel comfortable without the pressure to generate an immediate return.

Don’t Buy Post-Gains

A lot of hype is assigned to cryptocurrencies that make wild gains. If a crypto coin has suddenly seen a significant increase in value, it will be corrected quickly or experience a decrease in the future. When you see cryptocurrency has doubled, tripled, or quadrupled its value, be hesitant to invest at that point. Always buy stable and low.

Buy According to Underlying Fundamentals

A lot about cryptocurrency is speculative. The forecasts are based on what experts speculate will rise or fall. While their advice is a valuable reference point, don’t rely on them too much. As an investor, it’s up to you to remember the underlying fundamentals that indicate whether a cryptocurrency will maintain its value.

Any growth based on speculation and hype is what you want to avoid. Dig into your crypto research and see the application of certain coins. That’s the safe, reliable choice in a landscape of perilous options.

Crypto Exchanges vs. Wallet

Crypto exchanges are among the easiest ways to buy, hold, and sell Bitcoin and crypto safely. If you prefer having more control over your crypto security, setting up a digital wallet is the best option. The digital wallet is pretty easy to register. Afterwards, it allows you to turn your crypto into cash at any Bitcoin ATM. Just make sure the BTC machine supports your cryptocurrency.

Cryptocurrencies Can Disappear

In the past, scammers have come up with a particular cryptocurrency, gained investments, and disappeared. When these criminal activities happen, the investors can do little to recover their losses. Frauds are common when investing in new crypto coins without established reputations. Always beware when a cryptocurrency seems too good to be true.

Investing in crypto is not like placing a random bet. It is an unregulated market where some crypto is not as it appears. Look at how old the company is, the size, market value, and who created it. With sufficient information, decide whether it’s an appropriate investment for you.

How Much of Your Portfolio to Make Crypto

If you are investing in crypto, you likely have other investments being monitored. Investment recommendations generally suggest limiting cryptocurrency to a maximum of 5-10% of your total portfolio. Some even suggest it should be more between 1-5%.

Although it’s by no means a strict rule, you want to reduce the likelihood of a significant loss on a volatile crypto coin. Diversifying investments is never a bad thing. Be smart about the types of crypto you invest in, splitting between newer emerging coins and the more established cryptocurrencies.


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