According to Coin Metrics, the price of Bitcoin achieved a new all-time high of $63,729.5 in April 2021. However, the value plummeted by 30% to $30,000 in May, before recovering to $38,000.
To stay afloat in this volatile economy, you need to have smart strategies to invest in crypto. The large and unpredictable price changes demonstrate how fickle the crypto market is. It can be scary, especially if you’re unfamiliar with the crypto world. Not to worry; here are 5 smart crypto investment strategies that will help you get started.
- Figure Out How Much You Want To Invest
Before you begin, you must first determine how much money you wish to invest. Cryptocurrency markets, as you may have noticed in the news, are extremely volatile. According to the global crypto disclosure platform Xangle, investors have lost more than $16 billion in cryptocurrency-related scams and fraud since 2012. As cryptocurrency marketplaces are unregulated, investors have no one to turn to for assistance if they are scammed. Exchanges may turn out to be fraudulent, and their founders may vanish. A new coin could end up being a joke coin. Never invest more money than you can afford to lose is sound advice and a good rule of thumb that will ensure a good night’s sleep.
- Don’t Always Believe the Hype
Ignoring the hype and sifting out the noise in the crypto-space will be critical, just as it will be in any other traditional investment. When it comes to crypto investment, you shouldn’t rely on what other people are saying. Prices could plummet at any time, resulting in a huge loss. It is difficult to profit from the crypto market. To have significant gains, you must have patience and the necessary knowledge.
Wise ways to invest in crypto would be to thoroughly research the market, apply what you’ve learned to take cautious risks, and seek expert advice if needed. Seek guidance only from those who are well-versed in trading and investment methods. You’ll then be able to develop your own strategies and successfully filter out the hype and noise in the crypto world.
- Maintain A Balanced Cryptocurrency Portfolio
As the saying goes: don’t put all your eggs in one basket. Investing in more than just one coin is part of a well-balanced crypto portfolio. By diversifying your portfolio and investing in a variety of cryptocurrencies, you can mitigate the risks associated. You won’t be overly reliant on any single investment if you do it this way. It’s always better to lose some and win some than to lose all. Diversification is a wise approach to invest in crypto because it can help to keep gains stable. You may not be able to take advantage of all the benefits of a rising coin’s value, but you also won’t lose everything if its value falls.
- Start Small, Rather Than Big
Given the unpredictable behaviour of cryptocurrencies, it’s usually a good idea to keep your initial investment small. In some ways, investing in crypto is similar to investing in any other fiat currency. Even the most experienced investors have allocated just a single-digit percentage of their capital to cryptocurrency, investing the rest on less volatile assets. Maintain your investment discipline by avoiding being carried away by promises of massive upswings, despite the hype and forecasts.
- Keep It Safe And Secure
Even now, several crypto exchanges are hacked on a regular basis. It is critical to select a platform that offers best-in-class security and invests in frequent security audits to safeguard your crypto assets. Because crypto has no physical form, you should keep it in digital wallets which are either hardware-based (cold) or web-based (hot). The wallet can also be stored on a mobile device, a computer desktop, or printed on paper to keep the private keys and addresses for safekeeping.
Although cold storage (also known as hardware wallets) is one of the safest ways to store crypto because it is not accessible over the internet, hot wallets are still preferred for some users. You may want to read more about the types of wallets and their characteristics in our article here.
At UKISS, we believe that everyone should have the peace of mind over their digital assets and data. And we want to allow users to easily and effectively protect them. Our upcoming hardware wallet will offer the maximum level of protection for your private keys, giving you confidence and peace of mind while using it.
About UKISS Technology
UKISS Technology is pioneering the next-generation cryptosecurity wallet that is simple, safe, and secure to use. Their technology has also been granted patents in most major markets including China, the United States, Europe, Asia, and India. Their clients include government ministries, leading medical healthcare providers based in the APAC region, and major FinTech players. Stay tuned for more information.