Crypto 101

Crypto 101: How to Benefit from Cryptocurrency? (Part 1)

Cryptocurrency is one of the riskiest and rewarding investments in the current era.

All kinds of people made huge amounts of money by investing in cryptocurrency, ranging from tech nerds to average Joes.

This leads people to look for information about cryptocurrency investing. That is why this series is made for.

Investing is persistent and it takes knowing the projects to be invested in. It has to be known if a cryptocurrency is needed for the problem it is intending to solve.

Bitcoin is not the only cryptocurrency available: Cryptocurrencies aside from Bitcoin are referred to as Altcoins. These altcoins either serve a similar purpose for Bitcoin or a whole different purpose altogether.

When investing in cryptocurrency, the “Blue Chip” cryptocurrencies must be used for a start. These are cryptocurrencies with a market cap of around $2 billion.

Sticking with the $2 billion qualifiers is the preferred way since it sets the bar higher thus making the investments safer.

The Blue Chip cryptocurrencies are:

Above $2 Billion Market Cap:

BTC — Bitcoin — First decentralized cryptocurrency.

ETH — Ethereum — Smart Contract & Dapp Development Platform.

XRP — Ripple— Ultra-Fast and ultra-cheap international payments for banks.

BCH — Bitcoin Cash — Bitcoin fork, slightly faster than Bitcoin.

LTC — Litecoin — Bitcoin fork, faster and cheaper transactions.

EOS — Development platform & DAPP framework, uses DPoS.

BNB — Binance Coin — Exchange coin by Binance exchange, will be used in their upcoming DEX.

XLM — Stellar — Ultra-Fast International Payments & Development Platform, Ripple & Ethereum-like cryptocurrency.

Above $30 Million Market Cap ($500 Million +):

ADA — Cardano — Development platform, all code is peer-reviewed by scientists.

TRX — TRON — Blockchain-based entertainment content sharing platform.

XMR — Monero — Privacy based cryptocurrency, most popular privacy coin.

NEM — Enterprise level development platform.

Dash — Privacy based Bitcoin fork.

XTZ — Tezos — Development platform, uses DPoS.

MIOTA — IOTA — IoT Payments, Zero Fees. Some altcoins can be bought with Bitcoin or Ethereum, but more and more exchanges are starting to sell altcoins directly for cash.

Bitcoin, Ethereum, Ripple, Bitcoin Cash, Dash, Bitcoin Gold, and Stellar can also be bought directly from CEX for users everywhere.

Bitcoin, NEM, NEO, Cardano, Ripple, Litecoin, IOTA, and more can be bought directly from BitPanda for users living in Europe.

For some cryptocurrencies that cannot be bought directly, they can be bought from Binance with the use of Bitcoin or Ethereum.

Rule 1: Choose a cryptocurrency and know its price.

Once a cryptocurrency has been chosen, buy a small amount for a start and set foundations. As long as you have picked a good coin, it is better to get in now and hold for the long term. If you try to time the market, you risk the chances of buying the coin at a higher price later.

Rule 2: “Be Fearful When Others Are Greedy and Be Greedy When Others Are Fearful”

It is a famous quote by Warren Buffet which drives people to buy when other people are selling and should be cautious when everyone is buying – making the price rise.

A price drop is followed by a rebound that makes a price increase, so the investors can use the downturn to buy a cryptocurrency at a lower price. An upturn is usually followed by a correction that caused a big price drop. This is natural because investors are likely to sell once the price of a cryptocurrency has increased, they are taking profits.

A good piece of advice is to be patient. If a coin is bought when the price is high and it starts to decline, just wait for the price to recover.

Another great time to buy is when a coin is in accumulation, this is when the coin has been slowly but very steadily rising in an extended time.

Remember, Buy Low, Sell High

Investing into a cryptocurrency when it is nice and cheap, then sell it when the price has risen substantially.

For example, if one bought 300,000 Stratis at $0.01 on August 12th, 2016 he would now have $300,000 at its current price of $1.10.

Going back to rule# 2, this refers to waiting when everyone else is buying and buying when everyone else is selling.

When the investors are “greedy” and buying, this causes the price of the coin to keep rising and overpaying for the coin, particularly if there is a price correction later on.

Getting something from cryptocurrencies is a bit like a walk in a park, but there are a lot of things to remember before investing. But with this series, the difficult things will be easier.

Stay tuned to for the next part of this series.

For up-to-date Cryptocurrency, Blockchain, and Crypto-mining news, please join our Telegram Channel.

Leave a Comment

Leave a Reply