Investing in cryptocurrency has caught everybody’s attention — from professional market participants to newbies. The number of active crypto wallets is increasing day by day, new participants are joining the crypto community and there are already over 1,500 altcoins on the market. Let’s see how an emerging investor can make sense of this market and how hedging platforms like BITRUST can be of help.
So, you’ve spent a lot of time researching online and reading all kinds of information about cryptocurrencies and investing. However, before you even think about spending any money, let’s try to assess how much you really know about the cryptocurrency market. Here is a set of simple questions you could use to understand that:
- Could you explain what a blockchain is to your ten-year-old nephew as well as a Cryptocoin Kid can?
- Have you been to CoinMarketCap and understood it?
- Are you familiar with the cryptocurrency purchase mechanism?
- Where will you store your purchased altcoins and or tokens? Is it safe?
- Do you understand how cryptocurrency exchanges work?
- Do you know how to convert your cryptocurrency to fiat money and back?
- Is there any tax payable in your country from profit gained from these transactions?
- Do you know of any ways to hedge a cryptocurrency position?
- Do you know what volatility means?
A young and volatile market
This market is just a few years young so it’s no wonder that altcoins are highly volatile. Just see how ridiculously successful investors were last year and how extremely unhappy many of them have been in early 2018.
In terms of all cryptocurrencies, the total market cap hyped by 10,000% starting in 2013 and right up until its downturn this January. (And it’s true, we can only imagine what a difference an affordable hedging tool like BITRUST could make for investors, were it already live!).
So, how can one predict or trust an asset of such volatility and what should the right time be to invest in it? Today, in a month, in a year? Well, whatever your preferred answer to this question, just make sure that you only invest as much money as you are ready to lose. And be smart about never investing money you don’t actually own, using your credit card or taking out credit.
The right motivation counts
You should also make sure that you really understand the blockchain technology and appreciate the vision behind cryptocurrency, as well as the values concealed in its decentralization. Fear of missing out is not a very good driver behind any investment strategy.
Watch and study how altcoins are traded
Since its creation in 2009, bitcoin has been considered as the only electronic currency — the cryptocurrency. This continued up until 2016 and the growing interest in Ethereum. So, for early adopters of all things crypto, there was only bitcoin to invest in. Alternative cryptocurrencies, altcoins, have been just outside the interest zone of those seriously considering investing in this new type of asset.
This all started to change in 2017, when the dominant share of bitcoin fell from 90% to around 40%. So, it’s important to be aware of what’s going on in the market and watch daily, weekly and monthly volumes of the top most-traded currencies, as well as newly-released altcoins.
We recommend you take the time to study the altcoins that have a practical use case (like IOTA) to make sure you really understand it. Pay attention to maximum supply and credibility of the team backing it.
BITRUST for safer transactions — follow the news
As you can see, choosing which cryptocurrency to invest in is a little bit like being on a hunt for a bargain. On the way to a safer and more regulated market, let’s hope that more tools like BITRUST will appear for insuring a certain altcoin position.
BITRUST is a peer-to-peer platform, which serves as an affordable tool that enables those willing to offer the purchase of insurance for a certain currency position to find a party willing to sell such insurance. Entering into a BITRUST smart contract, the parties pre-agree on the terms of its opening. A smart contract executes automatically, so everyone knows all possible scenarios of the transaction and can count on those.
BITRUST is an online marketplace currently being developed by BTF Project Limited, a UK-incorporated company, and is expected to become operational by January 2019.
To finance the development and launch of the BITRUST platform, a limited-supply sale of BITRUST tokens (BTFs) will be created by BTF Project Limited. The sale will start on the 5th of March— see more information about the BITRUST ICO structure and the company BITRUST.
Disclaimer: This article is not intended as professional investment advice. Cryptocurrencies are risky, never invest more than you can afford to lose. Always seek professional advice before making any investment.