Cryptocurrency

What not to do when Investing in ETH

ETH - Ethereum

The landscape of investing has certainly changed over the years and partly due to the introduction of cryptocurrency and software that’s associated with cryptocurrency. ETH, although a software, also has a monetary aspect that many investors are now taking an interest in.

However, just like any investments, there are certain things worth doing to better your investments and things to avoid.  Every investment involves some element of risk and so it’s important to be aware that even if you do everything right, you could still lose your investment or any profit you make.

Here’s what not to do when investing in ETH so that you can make this investment as profitable as it can be.

What Is Ethereum?

Ethereum is a software and can help developers and programmers to run the code of any application they wish. The monetary aspect comes from the software using blockchain technology. A bi-product is created from the applications that are created which is referred to as a token called Ether. This is the monetary value of Ethereum and what investors will invest in.

Due to its uniqueness, it’s managed to pull in a lot of popularity and attention from a variety of industries. So if there were anytime to invest in ETH, then it would likely be now and there are plenty of places to buy ETH.

How to invest

In order to invest in ETH, you need a digital wallet and for many areas of cryptocurrency, a wallet is necessary to help store all your digital money in one place. ETH doesn’t actually trade on any major stock platform, so you’re likely going to find it through various applications or from perhaps an online discount broker.

You can get ETH on Moonpay as an example of a reputable company for buying digital currency. It’s also worth looking to sign up with companies that will offer you bonuses for depositing money into digital wallets, like Coinbase who’ll offer a $5 Bitcoin bonus when depositing $100 or more.

Ethereum

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It’s beneficial to look at all the relevant trading places in order to figure out which is the best trading platform, particularly when it comes to Ethereum. There’s a great market opportunity for investing in ETH but you also want to heed caution as mentioned above, that cryptocurrency is a very volatile and unregulated market.

What not to do when investing in ETH

When it comes to any investment, it’s important to know the mistakes that others have made in the past and that will hopefully minimize your risks as an investor. So, here are some of the things you should likely avoid when investing in ETH.

Don’t just be in it for the short-term

As much as investing in cryptocurrencies can provide a lot of financial success, a lot of that comes from being patient and letting your investment grow. There are plenty of investments in which you would like to be in it for a year or two before it matures or you pull your money and profits out.

If that’s what you’re after, then investing in ETH might not be the right choice for you. Trying to outsmart the market is not going to benefit you and trying to do it short-term is going to likely provide minimal returns and a lot of effort on your part. Instead, you’ll want to invest and see it out for a few years before you think about removing it.

There are plenty of other short-term investments out there so if this isn’t for you, there will be others available that better match your needs and requirements.

Buying whole coins isn’t as important as you think

The cost of just one ETH is thousands and as such, new investors will see one single coin as being useless. However, it’s not really about the amount of whole coins you have and can afford to invest in, but the potential for growth in its market capitalization and how it’s been performing over the last few months or years.

Mistakes are often made though from thinking that having less than a whole coin is a big thing. Instead, investors might opt for other digital currencies that might not actually provide much return or any. There’s a psychological viewpoint that having at least one whole coin is better than having a 0.08 or 0.115 of one.

So instead of thinking whole coins are what you should be investing in, pay attention instead, for it’s potential on the market for growth and profit. Buy your ETH in bits where you can and where you’re able to, rather than trying to find something where you can buy a whole coin.

Not setting financial goals

Regardless of the investment, it’s important to have financial goals or objectives when it comes to your investments. When you’re investing in cryptocurrency, you might not have the financial ability to buy the desired amount of currency at once. It might be something you buy in chunks over time.

By having a financial timeline or goal in place, you’ll likely make more careful decisions on what and when you invest. It’s also useful to have an end goal of what you want from your cryptocurrencies. Whether that’s keeping it in investment funds for future generations or cashing in your investment in time for retirement.

With financial goals and objectives in place, it can help keep track and monitor all your investments going forward.

Don’t make silly mistakes when diversifying

Diversifying your investments is obviously a very important part of investing in anything because putting your eggs all in one basket can be dangerous. However, what you don’t want to do is start investing in digital currencies that are obviously declining or not doing well on the market. Chances are, you might be throwing away money that could have gone into a currency that was doing well.

Having a diverse portfolio of digital currency can be a great thing if you’ve invested in the right ones, but try to avoid spreading your money into pots that aren’t going to necessarily perform well.

Selling too early

Like other investments, cryptocurrency is a long-term investment and selling too early would be cutting yourself short of any potential profit. In fact, it’s something that you’ll let grow forever or until you want to take advantage of the profit you’ve accumulated. It might be something that you keep in an investment fund for your children or for future grandchildren.

Think about currencies like ETH as being properties you own in cities like New York or London. You wouldn’t sell those properties, would you? So the same can be said when it comes to digital currency. It’s a forever-growing investment!

Lack of research or understanding of risk

One of the major mistakes that a new investor will make is not doing enough research. There’s really no excuse when it comes to the resources that are available to utilize online. It’s worth doing a lot of research before you invest any money into ETH or any other digital currency.

Crypto is a risk investment and like the stock market, it can dip and peak very quickly. However, where there’s higher risk, there’s more chance of bigger payouts and financial benefits. Not to say that this isn’t guaranteed but you have to be in it, in order to benefit from it.

Take your time because Crypto isn’t going anywhere. Do plenty of research, even ask your friends, family or colleagues that invest in it already for tips and advice. The more you know, the fewer mistakes you’re likely to make. Doing the homework is going to help you sleep easier at night, knowing you made a decision that you can live with when it comes to your money.

Not buying from a crypto exchange. 

It’s very easy to buy bitcoin from anywhere on the internet but it’s important that you’re buying from a crypto exchange. Why is that? Well because if you don’t, then you don’t have full ownership of that digital currency. If you buy outside of the exchange, you’ll own the amount your coin is worth but not the coin itself. 

As it’s been mentioned, having any amount of coin can be handy and for the long-term, having full ownership of the currency can be highly beneficial. Make sure to purchase your digital currency through reputable and well-known exchanges, rather than picking those that are sponsored on search engines. 

ETH crypto exchange

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Doing plenty of research will help you find the right ones that won’t be out to scam individuals who are new to investing in cryptocurrency.

It’s always important to remember that every investment carries risk and it’s good to do your research. Look into ETH in detail to make sure it’s the right investment type for you and try following these tips to help maximize the profit you make over time. Again, cryptocurrency is a long-term investment and should be viewed so when it comes to locking in your funds.

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