What You Want To On Crypto Here is The Answer
Cryptocurrency is a decentralized encrypted digital currency that can be transferred from one individual to another.
Since the launch of Bitcoin, many players have joined the market. Apart from Bitcoin, the other top players are Ethereum (ETH), Litecoin (LTC) and Ripple (XRP).
With so many cryptocurrencies on the market, it is difficult for traders to choose which one to trade.
Decision issues are made more difficult by new market participants touting their currency as the next Bitcoin. Below are tips to follow for choosing which cryptocurrency to trade.
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Choose Your Risk Level
With more than 2300 cryptocurrencies on the market, Bitcoin is the most volatile and stable. Investing in BTC is seen as a safe bet as it is the oldest on the market and is priced under an all-time high of $20,000.
Other cryptocurrencies are referred to as “altcoins” with ETH, LTC, and XRP established and stable cryptos.
It is advisable to spread your risk by diversifying your investments. To strengthen your investment portfolio, you may have to invest in one or more stable digital currencies.
Stable currencies are designed to mimic flat currencies. It keeps price fluctuations to a minimum and is a good way to put your money into a cryptocurrency exchange.
Do Independent Research
While it's important to listen to company representatives and ready-made opinions, nothing gives you a better judgment than doing independent research. Before deciding to trade BTC/USD vs ETH/USD or any other cryptocurrency, take a look at the historical charts.
Areas to watch out for are circulation and market capitalization. While price is important, it's not something you'll be stuck with.
Look for stability and dig into the complete history of cryptocurrencies. The digital currency could still be in its infancy and may show a sustained record of growth.
On the other hand, it may have a history of large peaks and large corrections. Avoid currencies that have experienced a large decline in their market cap. This is an indication of a dying request.
Find out as much as you can about the companies that offer cryptocurrencies, and the problems they are trying to solve.
Look for offerings that have innovative technology and strong idea support. Research on company leadership, their technical team, and CEO track record.
Beware of Possible ICO Offers
Initial Coin Offerings (ICOs) are the entry method for digital currency companies looking to generate working capital and launch new cryptocurrencies.
Similar to the stock market, it involves betting on companies that can deliver a product and give you a return on your investment.
When it comes to choosing which cryptocurrencies to invest in, ICOs give you a good chance. In essence, you don't have a history chart to guide you. So you should rely on your understanding of the offer, what makes it stand out in the market, and the team behind the offer.
Since you are starting from the ground up, investing in a good ICO will help you achieve huge returns. To help you be in a position to find your next profitable ICO, view past successful offers and track the latest trends in the industry.
Look to Unknown Crypto Exchanges
If you miss the ICO, you have the opportunity to buy currency on a cryptocurrency exchange. The most well-known and established exchanges limit the currencies they trade. You are likely to find better investments on lesser-known platforms.
To protect your investment, do independent research on crypto exchanges and the people who run them.
Alert and Alert
Choosing which cryptocurrencies and altcoins to trade can be a daunting task. Sticking to the facts and not making emotional decisions will help you choose the right investment for you.
Once you have selected the coins you wish to invest in, stay alert and monitor your portfolio closely. Be aware of all the news about your investments and continue to do the same independent research as you did before investing.
Altcoins may not experience the same rapid growth as Bitcoin because some are in a growth phase. However, choosing the right cryptocurrency to invest in can yield profitable returns.
Source : https://roboticsandautomationnews.com/2020/09/16/tips-on-how-to-choose-which-cryptocurrency-to-trade/36487/