Indeed, the advancement of technology has changed peoples lives – from the way we pay for goods to the way we communicate. To this day, various companies didn’t prefer actual cash as a mode of payment anymore and paved the way for online or contactless payments like Apple Pay.
Along with the advancement of technology comes the rising of high-tech smartphones, where consumers can shop or pay for items online. Through the years, a new mode of payment system is starting to make a name in the industry: Cryptocurrency.
You’ve probably heard about Bitcoin, the first Cryptocurrency to be developed. While it’s the first crypto to go mainstream, there’s more to Cryptocurrency than Bitcoin! The development of Bitcoin led to the birth of several other Cryptocurrencies, and more are developed every day, which are enjoyed by crypto enthusiasts.
Whether you are a newbie who is just getting a glimpse of the world of Crypto or an enthusiast who seems to haven’t gotten any luck, it’s important to know if you’re investing the right way! To help you, we’ve gathered some tips on how to invest in Cryptocurrency safely and correctly.
Cryptocurrency
Cryptocurrency refers to a digitalised payment system, but unlike other contactless payments that you know, this system doesn’t involve third party agents like banks to validate transactions. Cryptocurrency is a peer-to-peer system that enables you to send and receive payments wherever you are instead of having to bring physical money to carry around wherever you go. This type of payment only exists as digital entries to an online database that contains your transactions.
The term Cryptocurrency got its name from the way it works: using encryption to verify transactions. This means the system consists of advanced coding to be able to store or manage your Cryptocurrency data between public ledgers and the waller to provide its users’ security and safety.
Cryptocurrency Security
Cryptocurrencies are built using Blockchain technology – but what is it? This technology refers to how transactions are stored into “blocks” and time-stamped. While it’s a complicated and technical process, the output is a digital ledger of Cryptocurrency transactions that hackers may find difficult to tinker with.
To provide maximum security, the transactions in Blockchain technology require a two-factor authentication method. So to start the transaction, users will be required to input an authentication code that is sent on their respective cellular phones.
Although securities are tightly placed, it doesn’t mean that Cryptocurrencies are nearly impossible to hack. There have been cases of thefts and hacks of Cryptocurrencies – In 2018, hackers robbed BitGrail for $195 million and Coincheck for $534 million worth of Cryptocurrency. These cases were recorded as two of the biggest Crypto hacks of 2018.
Tips To Invest In Cryptocurrency Safely
While normal investments are risky and digital currencies are the hottest stocks, experts say that Cryptocurrency is one of the riskiest investment choices. So, if you’re planning to invest in Cryptocurrencies and start trading, check out these tips to ensure you make the proper choices.
- Do extensive research
Before investing even a small amount of money, it’s important to do your research and understand Cryptocurrency exchanges. These platforms produce ways for you to buy and exchange digital currencies but choosing one is not as simple as you think as there are about 500 platforms to choose from. Make sure to research and read reviews of trading platforms like the Bitcoin Era platform or facts from legitimate sources. Also, if you know someone experienced in the field, it would be good to ask them questions before moving forward.
- Know how to store your money
After buying or earning Cryptocurrency, your next step would be to store it in a safe place. Unlike the actual cash that you can store in your wallet or bank, Cryptocurrencies are stored in a digital wallet. So before purchasing, it’s good to read about the types of wallets, their benefits, security, and technical requirements, to decide which wallet suits you best.
- Distribute your investments
The key to any good investment strategy is proper distribution, which holds when it comes to Cryptocurrency investing. Make sure not to invest all your money in one digital currency just because it’s the only platform you are familiar with. There are thousands of options, and it’s smart to distribute your investments to different currencies.
- Embrace inconsistency
The Cryptocurrency market is known to be highly volatile, which means that the values of digital coins constantly change – so be sure to prepare for the ups and downs. As you progress in your career, you’ll notice the dramatic swings in prices – some days, it might be constantly high, then experience a sudden drop on the next day. So if your investment collection or mental wellbeing can’t handle this inconsistency, you might want to rethink your choices and figure out if Cryptocurrency is good for you or not.
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