When you look at the finance industry, you will find cryptocurrency to be the buzzword explains Brian Colombana. And according to popular research, the number jumped from 66 in the year 2013 to more than 6,800.
The people who work in cryptocurrency will always have an insight into the online currencies. But that is not the situation with everyone. However, you might get tempted to buy a cryptocurrency. Since, this domain is relatively new and it also unregulated, the risks are high. Hence, before you purchase the first crypto coin, you need to think about a few things.
Here are a few essential guidelines by Brian Colombana.
1) You need to know what you are purchasing
A cryptocurrency is a kind of online-only money that gets decentralized. It means, it doesn’t get controlled by the centralized entity, like a bank or government. If you wish to purchase things with this, you will require a cryptocurrency wallet. The transactions are mostly peer-to-peer. Hence, here there is no middleman between the receiver and you. Also, the transactions get recorded in the blockchain.
One of the essential selling points of a cryptocurrency is the scope of investment. And due to the high volatility of the market, several people invest in cryptocurrency, desiring fast gains. However, successful crypto investing is not easy. The market gets prone to speculation. The cost of the coins depends on the demand and supply principle; it’s because the majority of the coins don’t have an analog backup.
2) Is cryptocurrency a viable option for you?
The cryptocurrencies are expanding due to the interest from retail and institutional investors.However, you need to know whether crypto is correct for you. Several financial experts always warn that you can lose all your cash if you invest in crypto says Brian Colombana. However, many factors governs if that will ever happen. But you need to consider this possibility before placing all your earning in this market.
3) The ways to detect the legitimate ones from the fraud ones
There are multiple cryptocurrencies. Hence, the question arises, which one is authentic, like bitcoin? Few cryptocurrency creators do a complete rug pull. To place it simply, they develop a cryptocurrency and also advertise it ferociously, thereby promising great terms and also selling a stunning story behind it. The moment they come up with ample creators, such creators take away the coin’s liquidity pool dry, which makes the cost of the cryptocurrency fall to zero. How can you avert such scams? The solution is if something looks very good to be true, then you should have your guards up.
Last but not least, Brian Colombana says that it’s essential to be patient! The cryptocurrency market is growing and in a similar way the risks and frauds are also increasing. You must have come across the success stories where people got rich by choosing crypto. However, you shouldn’t allow the dreams of success dim your vision and discretion. There are several kinds of cryptocurrencies, hence you need to prepare accordingly before you commit. Make sure that you review the market and also the cryptocurrencies that you are interested in. After that you should learn about the creators, take time to observe and mark the trade metrics and also consult the experts.