Investing in crypto is a great way to set yourself up for financial freedom, but it's not for everyone. You should only invest money you're willing and able to lose because that's exactly what can happen if you don't do your research or don't follow this blog properly. 😂 Don't make the mistakes I made!
Crypto Is Volatile
Crypto is volatile, and that’s a good thing. Now, before you think I have lost my mind, let me explain. If you are an investor looking to make a quick buck in the crypto world, then volatility is not good for you. On the other hand, if you are someone who has been in this market for years—like me—then volatility is an opportunity for some great profits!
Volatility occurs when there isn’t enough supply or demand to meet the price of an asset. This causes large fluctuations in value which make it difficult to predict where the price will go next (hence volatility). When a new technology introduces itself to the world (such as cryptocurrency), its value can fluctuate quite wildly because there aren’t many people participating yet with enough supply/demand balance to stabilize prices across exchanges worldwide simultaneously over time. As more people jump on board investing/trading currencies like Bitcoin or Ethereum, there will come a time when prices become less volatile because there will be plenty of buyers willing pay top dollar for these assets. Thus stabilizing their value against other fiat currencies such as USD Dollar etc. In summary: Volatility = Opportunity!!!
You Don't Understand Crypto
Do you understand how crypto works?
Do you understand the technology behind cryptocurrency?
If not, then it's likely that you don't fully understand the risks of investing in it. Crypto is a complex space and there are many different types of coins out there. The same goes for blockchain technology, which is a decentralized database powered by cryptocurrencies like Bitcoin and Ethereum. It’s worth doing some research before diving into investing if this isn't your area of expertise or interest; otherwise, you may find yourself at risk from scams or a lack of understanding of how these currencies work. Take some time and look for the following info before putting your money into any crypto project:
- What Is The Problem & Proposed Solution?
- Team Background
- What Percentage of Initial Supply Is Owned By Team & Early Investors?
- Website & Social Media Links Like Twitter & Discord
- Total Addressable Market
In addition to this, you need to decide at which point you are going to invest and pull the money in the future.
You Need The Money You've Invested
Need the money you've invested? If so, crypto investing is not for you. You will feel the need to pull out money when the price of your coin is so low. Cryptocurrencies have wild price swings and most are backed by nothing but a promise that someday they'll be worth something. They're also not regulated by any central bank or government - so if things go wrong, there's no safety net to catch you!
You're Investing More Than You Can Afford To Lose
The first rule in all investing is to never invest more than you can afford to lose. This especially applies when it comes to high-risk investments like cryptocurrencies. Remember that this isn't your retirement fund, so don't put everything you have into a single investment. If it works out, great! But if not, at least you'll still be able to pay rent and buy groceries and live your life normally. Don't try to turn it into a disaster if it can only be a small bump in the road.
It's easy to get caught up in the hype and think that investing in cryptocurrency is like winning the lottery, but nothing could be further from the truth.
Crypto has been around for less than 10 years and has already seen a massive rise and fall (Bitcoin went from $0 to over $68,000, then back down under $20,000). While this rollercoaster ride may seem like fun for some people, it can be extremely stressful and even devastating for others. You should never risk what you can't afford to lose on something as volatile as cryptocurrency—no matter how tempting it may seem at first glance! Fear of missing out will rekt you. :)
Crypto is for everyone. Investing in it is not. Yepp, that's the conclusion of this blog. If you’re still looking to put your money in crypto and are considering doing so on your own, I encourage you to do a thorough assessment of the project before diving in. A great way to do that is to join a crypto community such as LeoFinance on Hive. You can learn more about how to safely invest in crypto opportunities and find new ones while earning $LEO token for your activity. And Hive, and several other tokens. xD