How to Get Into Crypto Investing as a Beginner

Despite periods of volatility and disruption, cryptocurrencies remain resilient, especially now that businesses are recognizing Bitcoin, Ethereum, and other digital assets as legal tender. While there is still a long way to go in terms of regulation, the crypto bandwagon remains thriving as it offers people more options to build wealth. 

There is still no better time to get into cryptocurrency investing than now. Even if you’ve known about cryptocurrencies recently, you can still make the most out of them using the right strategies and approaches. If you’re aiming to enter crypto investing this year, the guide below should help you get started on the right foot:

Key Takeaways

• Learn how blockchain works before investing.
• Use platforms like Kraken for reliable price tracking and education.
• Select a beginner-friendly exchange with low fees and strong support.
• Start with DCA or a diversified portfolio to minimize risk.

1. Know how the technology works

Being a beginner, it pays to know what keeps cryptocurrencies running. Go beyond the basic understanding that Bitcoin and Ethereum are forms of digital money and dig deeper into how blockchain systems work. For this, you only need to look at blockchain technology as a decentralized system that determines the value of cryptocurrencies based on how much is produced. 

Much like regular currencies, the prices of cryptocurrencies are influenced by how much is in circulation. By understanding the basics, you can make more informed decisions, especially when it comes to choosing exchanges and coming up with investment strategies.

2. Monitor the markets

As an investor, you will have to pay close attention to the factors affecting cryptocurrency markets. Don’t rely solely on what other people say, especially influencers. Make the effort to dig into the most important trends. You can read blogs and listen to podcasts on the latest cryptocurrency news. 

Consider checking reliable platforms like Kraken, which provides updates on the current Bitcoin price, as well as news on events that could disrupt cryptocurrency values. While you may want to profit as much as possible, you shouldn’t do so without gathering empirical data and expert insights.

3. Look up a reliable exchange

Once you’ve decided to enter the world of cryptocurrency investing, it’s only a matter of choosing an exchange where transactions take place. Although most exchanges offer a wide array of features and tools for managing assets and facilitating transactions, not many of them are ideal for beginners like yourself. 

When choosing a cryptocurrency exchange, opt for one that offers educational materials to help beginners like yourself trade safely. It also matters to go for an exchange that offers an intuitive platform, one you can easily navigate and won’t require high fees. Just be sure to compare different exchanges, focusing on each one’s strengths and weaknesses. 

4. Select a strategy that works for you

As you go deeper into the world of cryptocurrency investing, it matters to come up with an approach that lets you maximize your returns without exposing too much of your money to risk. For starters, opt to build a cryptocurrency portfolio consisting of a diverse array of cryptocurrency types so you can reduce your risk in case one of them undergoes a period of volatility. 

Another strategy you can use, perfect for beginners, is dollar-cost averaging, which involves buying a fixed amount of crypto assets at regular intervals rather than timing your purchases based on market movements. 

Endnote

It’s never too late for you to get into cryptocurrency investing. By following the tips above, you can build a successful portfolio that generates passive income.

FAQs

Q: Is cryptocurrency safe for beginners?

A. Yes, if you use trusted platforms and follow basic security practices like using two-factor authentication and secure wallets.

Q: How much money should I start with in crypto?

A. Start small - only invest what you can afford to lose. Many beginners start with as little as $10 to $100.

Q: Which crypto is best for beginners?

A. Bitcoin and Ethereum are widely recommended due to their stability and popularity.

Q: Can I lose all my money in crypto?

A. Yes. Crypto is volatile, which is why diversification and cautious investing strategies are key.

Q: What’s the best time to buy cryptocurrency?

A. Rather than timing the market, consider dollar-cost averaging to spread risk over time.