It seems that everyone is talking about crypto currency right now and if you fancy getting in on the act then now could be a great time to do just that. With this being said, there are many experts in this space like Robert Testagrossa who are rightfully warning would-be investors of some of the pitfalls which exist within the world of cryptocurrency. Nobody is saying that you shouldn’t invest if you so wish, but there are one or two things to be careful of when you do get started. Let’s take a look.
Simply because you heard that crypto is on the up and up does not mean that you should blindly go in and invest. It is absolutely critical, in this investment space more than others, that you have a very clear idea of what you are doing, where you are investing and why. There are so many who jump in without really understanding and they are the ones who lose money.
On Your Own
Something to remember about these investments is that you have the only access to your own individual wallet, and if you lose access then you will not be able to get back in. For this reason you must always ensure that you have all of your private details copied down both digitally and on paper. You must ensure that you have recovery keys and that no matter what happens, you will be able to regain access to your wallet. There are no banks to help you out here, this is all on you.
There is still a lack of trust by many when it comes to crypto and that is what contributes towards and incredibly volatile price, and this is the same across the board with crypto. This is why you must ensure that you are prepared for the swings which will happen. In a day you could see a price swing by 25% down and back up again, and this can be tough to watch. For this reason it is best that you have the stomach for these swings if you are looking to make money.
There are many coins out there which are in fact pretty worthless, but those who create them are looking to jump on the buzz and pump those prices high. What they will actually do in many cases is pay for bots to post on Twitter about a new and exciting coin. People see this on Twitter and then buy in, causing the price to balloon far beyond its actual worth. Naturally once the price is high, those who pumped it will cash out quick and that will result in many people being left with very little for their investment. Always research the coin fully before you decide to jump in and risk losing your money.
his can be a very good investment, but you have to be sure that you understand the risks.