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INTRODUCTION
Looking to get started investing in cryptocurrency? It is essential that you take time to research, as well as try to acquire the basics knowledge needed in crypto investment. In the bid for knowledge in investing, the following questions are meant to be answered:
- What's Cryptocurrency..?
- Why do I want to invest in cryptocurrency?
- What are the various investment opportunities?
- What are the pros and cons involved with the listed opportunities?
- What are the basic requirements involved in Cryptocurrency investment?
In the Bid to Answer these questions, a broader/clearer understanding of what is required to invest would be open to the potential investor. Let's take a timeout to answer the listed question above.
What's Cryptocurrency?
It's essential to understand that Cryptocurrency is a decentralized digital money that rallies on blockchain technology and is obscured by cryptography. For a better understanding of cryptocurrency, a basic knowledge is needed in three terminologies namely – blockchain, decentralization, and cryptography.
****Blockchain**** in cryptocurrency gives a broader knowledge on Digital Ledger whose access is distributed among authorized users.
Decentralization In blockchain refers to the transfer of control and decision-making from a centralized entity (individual, organization) to a distributed network.
Cryptography is the method that secures data from unauthorized access by the use of encryption techniques.
With a perfect understanding of the enlisted terms, the first step to investing is reached.
Why do I want to invest in cryptocurrency?
They're a million and One reasons why investors choose Cryptocurrency investing, An answer to this question informs the area to focus and some key choices of investment (Trading, DeFi NFTs P2Egaming etc.)
What are the various investment opportunities?
Investors are expected to at least get a picture of the investment area to focus i.e utility, payment, security, and stablecoins. There also are DeFi tokens, NFTs, and asset-backed tokens. A knowledge of the various investment opportunities would greatly enhance personal development skills..
What are the pros and cons involved with the listed opportunities?
All businesses are attributed with their individual opportunities as well as risks, Cryptocurrency is not an exception. Proper evaluation in risk management as well as opportunity maximization, guides inform decision taking. Knowledge on volatility attributed to cryptocurrency (A decline in value or a complete loss are possible at any time). This does not limit the fact that Cryptocurrencies have the potential to reshape the financial world, and undermine the very existence of traditional finance.
Some of the Pros and cons attributed to cryptocurrency included:
- High volatility - Potential to earn extremely high returns.
- The blockchain technology underlying cryptocurrency is inherently secure.
- Cryptocurrency has the potential to reduce inflation.
- Special skills are required to understand cryptocurrency.
- Crypto has serious scalability issues etc.
A knowledge around the pros and cons would help guide expectations around investment.
What are the basic requirements involved in Cryptocurrency investment?
The basic requirements most time required in starting your investing in cryptocurrency includes simple steps such as:
- Choose a wallet or Crypto Exchange(Exchange accounts are most times not safe for asset storage) interested in storing your assets. To buy cryptocurrency, first you need to pick a crypto exchange i.e Binance, Coinbase etc.
- Create and Verify Your Account.
Deposit Cash to the choice of your exchange. - Place Your Cryptocurrency Order.
Select a Storage Method.
With all the earlier listed questions successfully answered, your Crypto journey has begun. Other requirements are built as you progress.
Conclusion
The following information does not constitute financial advice or any other advice on services or digital assets. They're intended to provide general information. So personal decisions are most required, when investing(Crypto Asset).
Posted Using LeoFinance Beta
Posted Using LeoFinance Beta
