Many people enter crypto because of FOMO, etc., without a strong knowledge base. As a result, many people invest or trade randomly (I consider them uninformed or maybe even gamblers). You don't want to enter crypto just to lose, right? You don't want to have been in crypto for a long time but your portfolio isn't growing. So read this article thoroughly.
Why Invest in Crypto?
Bright Future: Many experts believe that crypto will be the future of finance. Therefore, investing in crypto can be a starting step for you to become a successful investor.
Mass Adoption: The adoption of crypto from the traditional financial sector is currently starting vigorously. Even some countries use crypto as legal tender. However, there are still some that create quite strict regulations for crypto itself. Nevertheless, crypto adoption continues to increase year by year.
Advanced Technology: Crypto uses blockchain technology, which is very transparent and secure. This makes blockchain technology very suitable for various sectors, especially finance. Imagine a country using blockchain in all its sectors, it can be guaranteed that there will be no corruption in that country.
Easy Access: You can buy crypto anytime and anywhere. Even friends who do not have a degree can access crypto easily.
Huge Profit Potential: Crypto prices can rise many times over in a short time. From this mass adoption, the demand from the crypto sector will continue to increase.
And others
But, Be Careful Too!
Investing in crypto is not as easy as it seems. There are several risks that you need to understand:
Rugpull coin: Where we mistakenly buy fundamentally weak crypto assets, like investing in a fraudulent startup. Adequate knowledge is necessary if we want to enter the crypto world.
Fluctuating Prices: Crypto prices can rise and fall very quickly. So, be prepared for your mental state to be tested.
Risk of Loss: If you're not careful, your crypto can be lost due to hacking or forgetting your password.
Unstable Regulations: Regulations regarding crypto vary from country to country, so there are potential risks that are still unknown.
and others.
Crypto Investment Tips
1. Diversification
Imagine if you only have one type of crypto. If suddenly its price plummets, your portfolio could crash. That's why the main strategy in crypto investment is diversification.
Large-cap: Be a wise investor by choosing large cryptos like #bitcoin ( $BTC BTC ) and #Ethereum ( $ETH ETH ). They have proven to be solid and have strong fundamentals.
Mid-cap: Don't forget to explore also the trending cryptos. They have high growth potential, but keep an eye on the risks too! For example, like Cardano (ADA) or #solana ( $SOL ).
Small-cap: For those who are willing to take risks, you can try investing in small cryptos. The profit potential is indeed large, but the risks are also higher.
2. Stablecoin: A Safety Net When the Market Panics
The crypto market is very volatile. Sometimes it rises, sometimes it drops drastically. Therefore, to be safe, allocate some of your funds to stablecoins. Stablecoins are like digital money with stable value, so they can reduce the impact of market volatility.
Don't underestimate stablecoins, because with stablecoins we can use them for future trading, staking, pools, and more. There is also an excellent stablecoin innovation from Binance, which is $BFUSD. Where we can use this stablecoin for futures and earn at the same time.
Project Evaluation: Know Before You Buy
Before buying crypto, it's essential to conduct research.
Check the technology: Is the technology innovative and has the potential to change the world?
See the development team: Is the team experienced and credible?
Study the roadmap: Does the project have a clear long-term plan?
Observe the community: The larger and more active the community, the better the project usually is.
Tokenomics
Tokenomics is like the rules of the game for a crypto. Understand how it works, the supply amount, and the token distribution mechanism. This can help you assess the profit potential and risks of a crypto.
Rebalancing: Adjust the Portfolio According to Trends
The crypto market keeps changing. Therefore, it is very important to rebalance the portfolio regularly. Sell cryptos that are underperforming and reinvest in more promising ones.
Bonus, Crypto Narratives that will hype
DYOR, this is just my opinion. In my view, the crypto narrative that will hype in the future is:
- Biotech
- Shoptaiment
- SocialFi
- AI
- NFT (already started, but not ended)
Disclaimer: This article is for informational purposes only and is not investment advice.
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