Cryptocurrency is reaching a wider audience than ever before because it is the most popular asset for investment, with a high-profit margin in today's market. As digital currencies are described as the future of currency, the cryptocurrency space is rapidly expanding and becoming too large to ignore.
As a result, more users and investors, particularly millennials and Generation Zs, are flocking to the space because digital currencies are an exciting and profitable investment opportunity that requires little to no technical knowledge.
However, despite cryptocurrency being capable of soaring up profits to 10x, 100x for each unit of an asset, there are many significant concerns to consider before investing in cryptocurrency. Aside from the fact that cryptocurrency is a volatile asset with large swings in value over short periods, there are several other things you should be aware of and consider before purchasing your first crypto asset.
So, here are seven things you should know before buying your first cryptocurrency to help get you started and make the most of your journey into the digital currency world.
What To Know Before Investing In Cryptocurrency
Get Educated About Cryptocurrency
What exactly is cryptocurrency? How does it function? How do I go about getting one? Where can I get one? These are the fundamentals you must understand before investing in cryptocurrency. As a result, you should have a general understanding of the processes for purchasing, exchanging, and selling cryptocurrencies.
So, before you dive in, educate yourself on the various platforms that accept deposits and withdrawals in your local currency to facilitate the movement of fiat currency into and out of the crypto ecosystem. However, the mainstream adoption of cryptocurrencies for everyday use is still in its early stages. Therefore, the ability to cash out into local currencies will be essential for maximizing profits.
Do Your Own Research
Research is essential before investing in any financial asset, and cryptocurrency is no exception. In fact, the phrase "do your own research" (DYOR) is common in the cryptocurrency ecosystem. It refers to conducting adequate research before investing a sizable sum of money in an asset.
As a result, spend hours researching, reading everything you can get your hands on, and reading educational blogs about the technology, so you understand the value proposition and risk associated with the specific crypto asset of your choice.
Research is essential when investing in cryptocurrency, especially when purchasing your first digital asset. To effectively conduct additional research on the crypto space and any crypto asset, ask questions, join online communities and forums, follow experts on social media, sign up for crypto developers' mailing lists, and listen to podcasts from various crypto enthusiasts.
Aim For Diversity and A Balanced Portfolio
There is always a temptation to betting everything on one asset for various reasons, such as being tricked by a community of ardent believers, a sharp increase in asset value, or even sweet-talking scammers. As a result, putting all of your money into a single crypto asset in the hopes of seeing its value rise could be detrimental, as crypto assets fluctuate in comparatively short periods.
On the other hand, you can have a well-balanced portfolio by diversifying your holdings, investing in various crypto assets, and spreading your funds among numerous projects in various industries, such as DeFi, gaming, NFTs, and others. Aiming for diversity can help you strike a balance in asset allocation by varying them according to their level of risk and market reputation.
Don't Invest More Than You Can Afford To Lose
The volatility of cryptocurrencies makes investing in them very risky. Aside from their erratic nature, cryptocurrencies are unregulated, and some assets eventually lose value completely. Therefore, only invest your money and avoid getting overly greedy with your investments and borrow or sell valuable properties to bet on any crypto asset.
There is no assurance that the value of an asset will hold over time, so whatever you invest in cryptocurrencies should be the remainder after all necessary living expenses have been paid with some additional funds set aside for emergencies.
Leverage Fractional Ownership
Another important consideration for buying your first cryptocurrency is the possibility of fractional ownership. This means you don't have to buy a whole coin when you can buy a bit of it and still make a profit.
For example, there's every possibility your first crypto asset is Bitcoin, the mother of all cryptocurrencies, which can be divided into the eighth decimal place. Thus, you can buy and invest as little as $100 worth of Bitcoin to see how cryptocurrency works and how to leverage fractional ownership.
Get Smart About Security
One of the most important aspects of purchasing cryptocurrency is keeping it secure. As a result, knowing about the security of your asset is just as important as investing in it. However, depending on the purpose of your investment, there are several ways to protect your cryptocurrency. For example, suppose you're curious about cryptocurrency and want to experiment with it. In that case, you could entrust the security of your asset to a third-party digital currency wallet or centralized platform.
If, on the other hand, you want to diversify your investment portfolio within the crypto space, you can be proactive about asset security by storing it in non-custodial wallets or on a hardware device over which you have complete control. Taking custody of your asset gives you control over your portfolio's security. However, great power comes with great responsibility; if you lose access to your asset, you could lose it forever.
Get The Right Wallet
Without a crypto wallet, there will be nowhere to store your cryptocurrency. However, it would be best if you considered the category of your wallet choice based on your needs. Does your investment require a custodial wallet? Do you want control of your assets and prefer a non-custodial wallet? Asking and answering these questions will aid your decision to choose the right wallet.
Therefore, ensure you get a reputable crypto wallet, whether custodial or non-custodial, with a diverse range of crypto assets, robust security measures, and user simplicity. Choosing the right wallet should be your primary consideration. One of the most reputable crypto wallets with the lowest barrier of entry is Cwallet.
Whether you prefer a custodial or non-custodial wallet, Cwallet lets you enjoy the benefits of both worlds in a single app. As a result, you can easily switch between the custodial and non-custodial wallet options within the app with a single button.
More importantly, you can transfer your crypto assets from Cwallet's custodial wallet to the non-custodial wallet at any time without paying any gas fees.
Why Cwallet Is The Right Wallet For You?
Cwallet is a unique cryptocurrency wallet that combines custodial and non-custodial features. With the help of this combined on-chain and off-chain wallet, you can manage and trade over 800 cryptocurrencies in a single spot, providing security, simplicity, and flexibility.
Cwallet meets individuals', and enterprises' complex crypto needs through a range of features such as the tip code, airdrop game, giveaway tool, mobile refills, bulk payment, request invoice, payment button, and so on. It is more than just a cryptocurrency wallet where users may send and receive funds, buy and sell, or hold and swap cryptocurrency.
Cwallet is unique because it charges zero transaction fees, allowing you to maximize your profits.
- No Internal swap fees
- No Internal/ External withdrawal fees
- No Fees on Deposit
- Lowest Network fees, and lowest gas limit, enabling you to pay the cheapest network fees.
- No Extra Charges or Fees!
Finally, Cwallet lowers the entry barrier for crypto usage. You can create a Cwallet account in one click using your Twitter, Telegram, or Discord accounts and immediately get access to deposit, withdraw, tip, and even earn by playing airdrop games.
Why wait any longer? Download the Cwallet App today to gain access to over 800 cryptocurrencies across 50 networks and start your cryptocurrency journey.