Cryptocurrency has become one of the most hotly-discussed asset types of the decade, but the sheer amount of information about it can be overwhelming.
For those who are only becoming acquainted with the concept of cryptocurrency, it can feel difficult to know where to begin and whose advice to trust.
What’s more, so many different cryptocurrencies exist that choosing a specific token to focus on can seem like a herculean task.
After all, Bitcoin isn’t the only potentially valuable crypto investment out there. There’s also Ripple, Litecoin, Dash, Ethereum, and Bitcoin Gold…. And that’s just to name a few.
What Do You Have To Look For?
One important thing for a potential investor to understand about these various cryptocurrencies is that not all of them work the same way.
More to the point, not all of them perform equally in the marketplace either.
What that means is that you have to be careful about which cryptocurrencies you put your money into. The best thing to do is learn about each token you have an interest in before you start betting on them.
If you plan to use cryptocurrencies to pay for goods and services, you’ll have to do even more research.
After all, just because a vendor accepts tokens as payment for goods and services, that doesn’t necessarily mean they’ll accept all tokens.
You might find that they’re able to accept Bitcoin, but that they aren’t set up for (or interested in) Ethereum, for example. Take a look at the different use cases for each token—as well as average transaction times, and the amount of privacy you’ll have as a buyer who uses them.
You’ll also want to consider the maximum supply for each token you purchase, since most cryptos have a cap that cannot be surpassed, and this may limit your ability to purchase them.
It can all feel like a lot of information to take in, and that’s okay—don’t let yourself become overwhelmed.
To help you understand the key facts in more detail, we’ve created this handy infographic to break them down easily. Take a look, and use what you learn to make smart choices for your financial future.
Once you get your head around different coins, check another one of our infographics – How To Choose Your Favourite Cryptocurrency.
About The Author: Nick Rojas combines 20 years of experience working with and consulting for small to medium business and a passion for journalism to help readers grow. He writes about technology, marketing, and social media for the aspiring entrepreneur. When Nick is not sharing his expertise, he can be found spending time at the beach with his dog Presto. @NickARojas