You must have heard netizens asking you to do proper research before investing in crypto and only do it when you are 100% convinced, rather than under the influence of a significant someone. While all these are right to follow, it lacks a concrete base and structure that informs you precisely what to do. But not anymore!
Below are some of the research-backed and most effective do’s and don’ts that will come in handy when buying bitcoin with other cryptocurrencies. A bonus section informing you how to invest in crypto as a newbie is also given.
Dos and Don’ts of Buying Bitcoin with Other Cryptocurrencies
When they said “Money attracts Money”, they must have been far-sighted enough to cite this statement for the world of crypto. It is about time that investors know when and how to buy bitcoin, especially if they are doing so with other cryptocurrencies. Here are a few do’s and don’ts to get you started!
DO’S
1. Build a crypto trading strategy
To build more money, do not give away yours to scams and giant sharks. Instead, take a step back, do your research, evaluate a project critically, see how your needs would be met, take referrals, and only then go for the investment.
2. Know how to manage risk
One of the most effective ways to manage risk while trading bitcoin with cryptocurrency is to not invest more than your set limit, even under the influence of others.
3. Add some versatility to your portfolio
They are right when they warn us about not putting all our eggs in one basket. If you want to reap the maximum benefits, diversify your investments and crypto portfolio.
4. Put yourself into the game for a sustainable run
Many people think of cryptocurrency as easy money and, as a result, enter the market with a mindset that they are only here to meet short-term goals. However, this is not how you expect to get good results. Instead, it demands patience and a strategy that allows you to stay between the ups and downs of the market in the long run.
5. Automate Purchases
Pound cost averaging is something that you can use every time you decide to buy a cryptocurrency, some shares, stocks, or commodities. They are a crucial feature in automating your purchases, and with the option of allowing recurring buys, you can always remain secure about the suggestions you receive.
DON’TS
1. Buy at a low price
To earn the maximum benefits from the market, wait till the prices go down and bid your money at that point. How many of us are guilty of listening to, and at some point, even adhering to this suggestion? Indeed, all of us. If you are still a firm believer in this statement, here are a few reasons why you should step back and reconsider your decision.
While it is true that if the prices are low, they may mean that the market is open to bargaining for up to a few cents, something also true is that low prices might indicate falling user rates. In addition, due to the cryptocurrency’s condition in the market, users might withdraw their assets from the crypto, thus leading to lower prices.
Contrary to popular belief, the cryptocurrency also often gets insecure, primarily due to the half-completed status of the project. When developers withdraw from an ongoing project, it can pause the update of the currency value.
2. Dive all in
You must have heard all sorts of advice and suggestions on how to bet all your money in crypto to witness the maximization of your investment in under a few days. But, no one tells you that this could have an adverse effect that can be seriously detrimental to your financial status.
Better investment advice can be to only bet a specific proportion of your total financial resources and put the rest under your savings account for emergency purposes. But unfortunately, no matter how much we deny it, some part of the crypto market remains unpredictable. If the turn of events results in something unfortunate, it can take away all you had earned and saved for so long.
3. Think of it as easy-money
Most of us are attracted to investing in crypto because of the money we see people making and misunderstand it to be an easy way of earning a couple of extra bucks. This schema restraint us from putting in any extra effort because we believe money to flow without any push from our side.
When this happens, and we witness no signs of progress, we become disappointed, but it also takes away from us all the crypto assets that we have invested in so far. The same is true for financial trading assets like stocks, shares, and commodities.
4. Forget the keyphrase
Most of us use a hardware wallet that comes in need when we want access to any of the crypto information. Usually, the wallet is protected by a keyphrase that needs to be put in to retrieve your assets. If you, by any chance, forget the keyphrase, you can land into a lot of trouble since it can render all your crypto assets completely irretrievable.
5. Fall for scams
If you come across deals that feel too fair to be accurate, be prepared for a scam warning. You can hardly expect someone to go forth and offer you a value that makes you a millionaire overnight in the crypto world. It doesn’t happen that easily, especially if you are a newbie in the field.
Some of the most common scams that you should stay far away from include pump and dump, fake coins, malicious wallet software, and cloud multiplier scams.
Conclusion
Now that you know the do’s and don’ts of buying bitcoin with other cryptocurrencies, do not restrain yourself from getting access to every information about crypto. Subscribe to the website okx.com today and get all the latest updates about the crypto world.
