What is Crypto and What is The Best Way to Get Started?

Guestpost by Abby Bootman

Cryptocurrency, should you invest or not? Where does one start? Many topics have already been tackled here surrounding the topics, but still, the question keeps coming, especially since November/December last year!

In order to wrap our heads around it, our guest writer today, Abby will help us on how and where to get started with crypto!

What is Crypto and What is The Best Way to Get Started?

Cryptocurrencies have had a positive impact on the world of investing, and many people are now looking for ways to buy bitcoin. But for the majority of people, the industry seems confusing, volatile and filled with risk. Knowing this, it is important to have some guidance in order to navigate yourself in the right way. If you’re a beginner looking to learn you’re in the right place. This article will introduce you to
the basics of the crypto market, and the things you need to know in order to get started. Let’s
get started!

What is Crypto?

man thinking

Crypto is short for cryptocurrency and represents the whole market of blockchain-based coins and tokens. Cryptocurrencies can be built in a decentralized manner and are traded through different centralized (exchanges) and decentralized platforms (DEXs).
In total, there are about 8000 recognized cryptocurrencies that are “officially” placed in price tracking websites like CoinMarketCap. That said, not all of these coins are viable investment options, and their success relies solely on the demand of acquisition (adoption).
Because of this, it is important to first recognize the following:
– From all the available cryptocurrencies, only Bitcoin is known as the most reliable decentralized store of value.
– Ethereum comes right behind it as the most recognized platform that enables the development of blockchain apps that are not limited to the finance industry.
– Exchange-based tokens like BNB are also reliable investment options but usually riskier and less decentralized. That said, these tokens enable users to participate in different financial products that can generate passive income.
– Other, smaller-cap altcoins may also be good investments but pose a significant amount of risk. Hence, investing in them depends on your preference and risk tolerance.

Researching Cryptocurrencies

research Study #DYOR Do You Own Research
Photo by Iewek Gnos on Unsplash

There are three main ways to research cryptocurrencies, and you will usually know what type of analysis you need based on your investment preferences.
– Technical analysis is probably the most common option, as it is used by day traders and short-term investors. This method looks at candle charts in short and longer timeframes analyses the price of cryptocurrencies based on several indicators and creates mathematical models to predict potential outcomes (in terms of value).
– Sentiment analysis is a great, and very broad, research method that looks into the “feeling” of the market in order to determine investment opportunities. Knowing how the public thinks about the market as a whole or a specific coin enables improved swing trading. To perform this analysis method you will need to track upcoming events, social media mentions, as well as the reputation and
promotion of crypto projects.
– Fundamental analysis is the third method, which deals more with long-term conviction rather than short-term research. This is the research method that requires users to look into whitepapers, fundamental value, and working products, all in a macroeconomic context. This is the most reliable analysis method to develop emotional intelligence and become a better HODLer.

[Jonathan: Absolutely agree with Abby here, go fundamental analysis first]

Getting started

Now that you know more about the industry itself and how to research the best opportunities, you can start by deciding what type of trader you wish to be. This will depend both on your risk tolerance, personal preference, and starting capital.
Those with a lower starting capital and enough time to look at charts and price indicators may want to start with some slight day trading, after first understanding the importance of growing portfolio value in terms of Bitcoin. Try to only use a small amount of your portfolio’s value for day trading and send your profits to long-term cold storage.
Swing trading is another great option and is best for those with more experience in the markets. When trading in this way you only make a few trades per year, all of which are based on rumors, news, and the overall sentiment of the market. It is a little less risky than day
trading, and a lot more about timing the market correctly.

cryptocurrency trading #swingtrading #daytrading #crypto

Finally, you could simply invest and forget. This is the essence of long-term investors, a term which here is often known as HODLers. There are two ways to invest in the long term. The first option, for those with a large amount of starting capital, is to invest all your money upfront. The second option, which is increasingly becoming more popular, is to use Dollar Cost Averaging.

HODL #buyandhold
DCA and Chill

(DCA), a method which here means that you may small amounts of BTC in incremental and repeating periods of time. The latest option has the least amount of risk and is the easiest method of investment.

Read More: Should you Invest in Bitcoin?

Wrapping up

You should now be ready to delve into the specifics of crypto investing and feel more organized as far as trading is concerned. Keep in mind that this article should not be considered financial advice, but rather educational material to improve your research.

About the Author

Abby Bootman studied at Pace University as a psychologist, last year she worked at the casino reception desk in Vegas, and later remained there for a permanent job. She has been working in this area for about 5 years and during this time she has seen many people who have suffered from various types of addictions. Because of this, she chose game addiction as the theme of her thesis. Now he is writing articles on this topic as a hobby.

I would like to thank Abby once again for giving us this brief introduction to cryptocurrencies. I would personally stay away from swing trading and rather DCA when it comes to this highly volatile asset class but up to you, now you know at least the various way to get into the market!

If like Abby you wish to collaborate for guest posting or sponsored posts please do not hesitate to reach out by e-mail jon@joneytalks.com and of course, for everyone, do follow us on social media as well for more great content, check our FacebookInstagramTwitter, and join our e-mail list. I would love to connect with you!

Disclosure: This post may contain affiliate links. That means I may make a small commission (at no cost to you) if you make a purchase. This will help to support Joney Talks!

One thought on “What is Crypto and What is The Best Way to Get Started?

Leave a Reply