Beginners Guide to Cryptocurrency
These days, it seems as if you cannot turn on any piece of financial news without hearing about cryptocurrency. Almost overnight, the crypto industry has become absurdly popular, earning investors millions and turning into a brand new financial sector.
Author:James PierceReviewer:Camilo WoodMay 06, 202112.4K Shares621.4K Views
These days, it seems as if you cannot turn on any piece of financial news without hearing about cryptocurrency. Almost overnight, the crypto industry has become absurdly popular, earning investors millions and turning into a brand new financial sector. However, because it is so new, many people still have plenty of questions about just what this industry is.
What Is Cryptocurrency?
Cryptocurrency is shorthand for the thousands of types of new "currencies" that exist. These currencies, unlike the physical currencies that we deal with every day, only exist as digital data. Their value relative to the dollar fluctuates on a regular basis, so you can invest in the various types of cryptos like you would another stock.
Remember, crypto is more than just Bitcoin. According to the crypto experts at Money Morning, "...about 9,000 cryptocurrencies exist – a number that grows every day."
Why Are Cryptocurrencies So Popular?
There are quite a few reasons for this. First, they have all the hallmarks of a popular media story. Their value has increased very quickly, creating a slew of attention and feeding into the idea that cryptos are the "next big thing." The mystery behind crypto, including the mysterious and unknown origins of Bitcoin's creator, has also led to many questions. Furthermore, technological boundaries continue to fall, making it easy for people to invest in cryptos.
The breadth of cryptos also makes them very popular, as there is something in the crypto market for almost everyone. It's hard to say what the best cryptocurrenciesare because that's something that changes on a regular basis.
How Do I Buy Cryptocurrency?
The truth is that investing in cryptocurrency is startlingly easy. There is a wide array of online platforms and websites now available that make it exceptionally easy to buy crypto. These include apps like Robinhood, WeBull, and many other stock brokerage websites.
However, that ease can be extremely dangerous, as it enables people to buy on instinct, rather than after deliberate thought. The truth is that you should not make any crypto investment without doing your due diligence into the type of crypto you want to invest in. You should also take a step back and make sure that your crypto investment aligns with your personal financial goals. Furthermore, it is worth keeping in mind that crypto has extremely high levels of volatility. This is not for everyone and it is something you need to keep in mind.
It's also worth considering that there is a slew of online trading options available. Some work better for some people than others, depending on how frequently you will be making crypto investments and how long you may plan on holding your investment. As such, make sure to do research into which platform best suits your financial goals.
Crypto is a highly complex financial market, one that may help investors turn a profit or may cost you a pretty penny. The best way for you to protect your hard-earned dollars is to do your homework and make sure you are making an investment that best suits your financial needs.
James Pierce
Author
Camilo Wood
Reviewer
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