What is a cryptocurrency? Most do not even know, thinking that it is some kind of magical thing that yields exuberant profits the moment it is acquired. The Instagram and Facebook posts of so-called crypto millionaires have only fueled the myth that cryptocurrencies are some kind of silver bullet to poverty, a getaway from the financial troubles that everyone working nine to five faces. However, the sad reality is far more prosaic and the memes that play on the irony of the cryptocurrency market perfectly illustrate how something is made out to be what it is not in reality.
To be put bluntly, a cryptocurrency is nothing but a digital stamp in a digital registry called a blockchain. The blockchain itself is a huge ledger containing countless records of the movements of said cryptocurrencies between specific destination addresses called wallets. The movements of these assets are completely transparent and one-way, meaning they are immutable and cannot be altered in any way. This makes the blockchain an accessible and free to view registry of transactions, nothing more. The financial hype that was woven around the technology like a cocoon by the fanatics and opportunists of cryptocurrency profiteering is a completely alien and artificial phenomenon that has almost nothing to do with what cryptocurrencies and the underlying blockchain stand for and are capable of.
The so-called value component was grafted to cryptocurrencies the moment the blockchain was released. The reason is because a few entrepreneurial individuals decided to create buzz around the technology and earn on its potential, essentially monetizing something that was not intended to be a financial asset. By artificially adding value to cryptocurrencies and turning them into assets with prescribed capabilities, such as their acting as access keys to some services on the blockchain, these entrepreneurial individuals managed to convince a huge mass of users to start paying for digital assets with actual fiat.
Needless to say, it the fad quickly caught on as countless other individuals unwilling to be left overbroad of the rapidly capitalizing industry decided to introduce their own projects on the blockchain in an effort to earn as much as possible. Most of these people had absolutely no idea about what the blockchain was and what its potential as a technology could truly be. Their interest was purely financial and commercial, which was the main reason why the vast majority of cryptocurrency projects crashed and burned.
Nonetheless, despite the many failures and catastrophic market crashes, the cryptocurrency industry maintains the interest of the public. The reason is just as simple – ongoing advertising and marketing, which is incessantly working on creating new and ever more elaborate schemes of attracting new users into the industry in an effort at making them spill out some cash. Of course, most users who enter the blockchain space do so in hopes of making a profit. Indeed, there are ways of making considerable sums of money on blockchain-based applications, but the actual number of people who will be able to successfully leverage the myriad factors involved in making that a reality is negligible. The rest, those who do not have the necessary amount of capital or knowledge, will simply be acting as liquidity providers and will lose said liquidity on the first caveat they encounter, of which there are many.
Buying Cryptocurrencies Without Regret
Before anyone ever thinks of entering the cryptocurrency domain, they must ask themselves – why they are going to do it. The search engine query “where can I buy cryptocurrency” is the easiest of the ones that can be satisfied, as the internet is literally brimming with offerings ranging from legal to those bordering on plain scams. However, the “where can I buy cryptocurrencies” query is only gaining popularity.
Many engage in the cryptocurrency space because of the fad and the desire to join a newfangled vibe that promises some money. Others are merely curious about just how deep the proverbial blockchain rabbit hole goes. Some have previous experience in trading and believe that they can leverage their skills in the cryptocurrency domain to make a profit. Others still make entry into the cryptocurrency space under the pretense of becoming part of a digital revolution. Silly as that may sound, there are actually still plenty of crypto fanatics out there.
However, before venturing into cryptocurrency space, one must realize the following simple truths:
- Do your own research into the cryptocurrency market;
- Be advised that every project is potentially a scam;
- Never share personal information and private keys;
- Never trust anyone;
- Never invest more than you can afford to lose;
- Never use loaned funds.
The last point is of special relevance, since many people search “where can I buy crypto with credit card” in their search engines. This is a downright wrong way to purchase cryptocurrency, since it means having to deal with debts that can snowball in case of heightened market volatility or project failure. And the cryptocurrency market is brimming with cases when a trading platform and other services failed overnight, resulting in millions of losses for their users. That is why it is essential to choose the best possible trading venue based on history and reviews, not instant advertising.
There are many other opportunities for making some profits on the cryptocurrency market, such as Ethereum cloud mining, which is quite affordable and relatively low risk. Currency exchange in the manner of Forex is also present and boasts a low entry threshold. By opening several market accounts, traders can easily scalp profits on multiple trades. In fact, the easy purchase of crypto is a staple of the market to make sure more users enter it.
Other cryptos offer airdrops and similar actions that require little effort on the part of the user, but reward them with some manner of income. These projects can help you make some pocket money in the short term, but are unfit as portfolio additions. Never forget to transfer your cryptos to a cold wallet and a non-custodial storage space to protect them from attack. The platform for storing cryptos must be secure and reputable, otherwise, the risk of losing funds is high.
A bank account will also be handy when venturing into crypto space, since the proceeds will be transferred there and the deposit will be topped up from it. Users will also have to get used to using gateways, such as exchangers to convert their cryptos to fiat and back. In order to sell crypto, users will have to resort to exchanges, which offer a lot of opportunities for conversion and transfers. Your crypto must remain yours, so never leave deposits on an exchange’s hot wallet. Some more creative options include the Bitcoin ATM, which allows instant withdrawal of cryptocurrencies to fiat right in the streets.
Options and futures trading is a stable of the market that is also in high demand. The get coupon option offered by some exchanges when trading adds a pleasant bonus to the process and gives a special incentive to keep on trading. In fact, many traders confirm that the process of trading itself is what motivates and energizes them. They confess that the convenience and ease of use of the app make their trade process seamless and enjoyable, allowing them to not only earn on their actions, but also receive pleasure while doing so.
Key Takeaways
Cryptocurrencies are nothing but digital records on a digital ledger. Without their perceived and attributed value, they have no intrinsic value. The speculative nature of their prices and the artificial mechanics that govern their market are highly susceptible to manipulation on the part of major players and have to be taken into account by those who stand to lose everything in case of a sudden market shock. One must never forget about risk management and maintain a small amount of funds in cryptocurrencies. Never invest more than you afford to lose and make sure you are comfortable with the amount of your investment before clicking on the trade button. Never use loaned funds and be sure to steer clear of any offers and advertising that sounds too good to be true or is way above the market average.
By following these simple rules and maintaining a clear head, one can hope to make entry into the cryptocurrency domain and get their bearings. Once the user has acquired a sufficient amount of experience and knowledge, they can start experimenting with trading or copying the trades of more experienced traders.
