Investing in Cryptocurrency for Beginners Explained

If comfort and luxury are all you want in the future and for generations to come, the Crypto market is where you should be. When it comes to this fascinating world of trading, staking, and the art of profit-making and speculation, the golden rule is to enter as soon as possible. No matter how meagre your salary scale or savings are, start investing right away once you start earning. This rule helps you have the best income by the time you want significant returns with it.

However, it is also important that you learn this craft every day with keen interest and discipline, so that you will be able to master your skills and gain more even within a short period of time. This market is highly competitive, and having real knowledge will help you ace the race for sure. This article will help you gain real, practical insights about the world of crypto in the most comprehensive terms. We have drafted this article, keeping in mind the beginners or those who have dived into it even before gaining the right lessons. So, here you go in the world of crypto with the most trusted guide you can ever find out there. 

10 Reasons Why You Should Invest in Cryptocurrency 

1. Potential for high returns

If you are investing in any of the traditional savings methods available in the market, you will not be able to make as many returns as cryptocurrencies. But if you take the effort to learn and speculate on the future of cryptocurrencies in the market, you are highly likely to make significant gains within a short period of time. 

2. Opportunity to diversify your investment 

When it comes to investing in cryptocurrencies, diversification is the key. Most of us would be quite intimidated by the risk involved in these investments. The risk percentage can be substantially reduced or balanced if you invest in different digital assets, so that fluctuating market sentiments will not pose a huge threat to your hard-earned money. 

Diversifying your investment portfolio is crucial, and cryptocurrencies can be a part of that strategy. The Financial Industry Regulatory Authority (FINRA) offers guidance on how to approach investments in cryptocurrencies and related financial products.

3. Sustained purchasing power 

Even if the entire world is getting crunched during hard times of inflation, you would still be able to live comfortably as before if you have invested in cryptocurrencies such as Bitcoin, which has a capped supply of 21 million coins. However, if you invest in them, they are highly likely to perform relatively well during inflation, and thus sustain your purchasing power. 

4. Financial Sovereignty 

Imagine investing in traditional financial instruments, such as fiat currencies, stocks, and bonds, where there will be authorized personnel and management to control our finances. We have to count on these intermediaries for approvals and consents regarding our own investments. This is not the case with cryptocurrencies because they are run on a decentralized ecosystem that is not controlled by a single person or entity, offering users financial sovereignty. 

5. Available 24*7 

There aren’t any banking hours, business days, or appointments here. You can engage in trading, staking, and every other crypto-related service by simply having access to a device with internet connectivity. 

6. Ace the technical race 

If you invest in cryptocurrency, you are also winning the technical game by investing your time in sophisticated technologies like DeFi, DAO, and NFTs. These innovations are likely to take over their traditional counterparts in the future. 

7. Accessible even for the smallest investors

As we have mentioned earlier in this article, no matter how small your salary scale or savings amount is, you can still make a small investment in the crypto market. There are a ton of assets with tremendous future price potential that are currently available for cheap prices, promising you sizeable returns. 

Cryptocurrencies can be accessible to small investors due to their divisibility. The U.S. Securities and Exchange Commission provides information on how to approach small investments in cryptocurrencies.

8. The crypto community effect 

The exposure you get by holding crypto, you will be adopted by a community of the particular token’s enthusiasts, including developers, core team members, and fellow investors. These groups can educate you on the asset’s technological prowess, use case, and future potential, while allowing you to contribute to the growth of the cryptocurrency/blockchain project. 

9. Guaranteed passive income 

If you are looking for a reliable passive income source, but do not really have the time to invest in a part-time job or commitment, cryptocurrencies can help you out. It is true that you need some time to learn the art, research consistently, and stay up to date with the market trends. However, this will be relatively less when compared to the time you need to invest when it is a real side hustle job. 

10. Liquidity 

Life is quite unpredictable, so you never know when you will be in the middle of a financial emergency. Liquidity of cryptocurrencies facilitates prompt transactions in this regard.

How Much to Invest in Crypto Per Month 

Now, that is one of the most common doubts that can pop up in your mind, especially when you are an absolute beginner in the world of crypto. This varies according to your investment goals and the risk percentage you are willing to take on. However, if you are looking for a generally recommended allocation, you can go for 1-5% of your monthly net worth. Make sure you are learning more each day and gradually expanding your investment, responsibly.

Best Cryptocurrency to Invest Today 

Just like how much to invest per month, this is also a similar topic for which the answer is quite subjective. Every cryptocurrency has its own peculiarities and growth rates, and should be learnt well over time. However, if you are a beginner, it is recommended to go for established ones and those with higher market caps, so that you do not need to stress a lot about the risks involved. Nevertheless, there is no such thing as a risk-free option. Market volatility is for real. The top 10 largest cryptocurrencies, including Bitcoin (BTC), Binance Coin (BNB), Ethereum (ETH), Solana (SOL), and Ripple (XRP), are the ones you can consider due to their market dominance.

Safety Tips for Crypto Investments 

You can learn more about larger profit-making tips gradually. But learning about the safety techniques is non-negotiable. Here are some of the tips you must religiously follow. 

1. Don’t Overinvest

This world has a charm that you will not be able to resist. Every time you look at the growth chart of some coins, you would feel the urge to invest more than the recommended percentage of your net worth. This can be dangerous, since cryptocurrencies are highly volatile, leading to heavy losses during a market crash. Hence, do proper research and understand your financial risks before investing.

2. Research 

Doing your research deep and wide is the key. This will protect you from significant losses that might occur if you happen to invest in cryptocurrencies that are expected to experience a price decline. 

3. Beware of the scams 

Just like any other financial sector, there are a lot of financial scams happening here. Ponzi schemes and phishing attempts can bring you to nothing if you are not careful enough. 

4. Secure Storage 

We always recommend that you go for secure storage modes such as hardware wallets rather than online ones, since they are always vulnerable to threats and hacks.

Conclusion 

Now, that is all you need to know and learn as a beginner in the crypto market. We have tried to include a comprehensive introduction about the world of crypto and a couple of valid reasons that prove the need to invest in the asset class. Apart from that, we have also given you a clue about the investment percentage you can consider to begin with, and also some of the established currencies, generally regarded as suitable for beginners, since they involve lower risks, with no steady declines. Last in the article, we also gave you insights about the safety aspects to be looked into while you’re beginning your crypto journey.