In the last few years, we’ve seen a new wave of digital currencies. Digital money is becoming more and more accessible, with many different opportunities for investing. However, it can be difficult to know where to begin. When it comes to investing in crypto, timing is everything, due to market volatility.
With high-profile cyber attacks on exchanges making headlines almost every day, it might feel a bit risky to invest in cryptocurrency right now. However, this doesn’t mean that now is not the right time. Now could be one of the best times to invest in crypto if you have an eye on the long term and a risk tolerance. This article will introduce you to a few things about crypto, stay till the end.
What is cryptocurrency?
Cryptocurrency is digital money that is managed and stored using encryption technology. Unlike traditional currencies like the Pound or Dollar, which are controlled and issued by central governments, cryptocurrencies are decentralized. This means that no central bank or government is regulating or managing their use and value.
This is important because it means that the adoption, use, and value of crypto is not tied to any one government and is therefore not as susceptible to political or economic instability. Cryptocurrencies are also referred to as tokens. Tokens are coins that are generated and sold to investors in an Initial Coin Offering (ICO). Which is a kind of crowdfunding process where investors receive tokens in return for their investment. Once the ICO is completed, the tokens can be traded or used as a form of payment for the company’s products, services, and applications.
Why does crypto matter anyway?
Digital currencies are becoming a global phenomenon that is disrupting many industries. As the crypto market grows, it is worth understanding how it works so you can better understand how to take advantage of it. The global crypto market is expected to grow from $431 billion in 2018 to $1 trillion by 2020.
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But why is this happening and why should we care? The most immediate reason is that cryptocurrencies have become increasingly accessible and easier to use. Many cryptocurrencies were designed with specific use cases and applications in mind. As a result, many companies are building products and services that are focused on providing solutions to real-world problems. They are doing this by using cryptocurrency as a core element and part of their business model.
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How can you invest in them?
Crypto can be traded on several different exchanges, but unlike equities, it can’t be purchased through a broker. However, there are a few different ways to get your hands on cryptocurrency and start investing: –
Crypto funds: Some investment funds will have a portion dedicated to crypto assets, but these are very rare.
Crypto investment funds: These are funds that specialize in cryptocurrencies and blockchain investments. You can buy shares in them just like any other investment fund.
Direct investment into a crypto fund: Some crypto funds will allow investors to directly buy into the fund as opposed to buying shares.
Direct investment into crypto tokens: There are a variety of crypto tokens to choose from, so make sure you do your research and find one that fits your investment needs.
Direct investment into crypto exchanges: There are a few crypto exchanges that allow investors to buy and sell cryptocurrencies using fiat currencies.
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Is it too late to invest in crypto?
As with any investment, timing is everything. The value of cryptocurrencies can be very volatile and can be affected by several different factors. There is no guarantee that the value of any specific digital currency will increase or that an investment will pay off.
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However, if you are looking to invest in crypto, now could be a very good time. The crypto market is expected to grow significantly in the next few years, and several new opportunities are emerging as a result. If you are interested in getting involved in the crypto market, now is a great time to start.