Countless transactions are happening every day in the cryptocurrency world. As of now, Bitcoin and Ethereum are considered the most popular cryptocurrencies in the world. Bitcoin has been around for more than a decade and Ethereum came only a few years later.
However, nowadays, we have many cryptocurrencies to invest in. Therefore, we only need to pay special attention to whether the cryptocurrency is worth it or not.
Furthermore, there are some important tips you can learn to follow before you invest in cryptocurrencies.
Let’s dive deeper into this article to find out!
7 Tips for buying and selling cryptocurrencies
1. Choose the right platform
Whenever you are about to invest in cryptocurrencies or consider selling them, you need to pay close attention to the platform you are using. There are plenty of popular cryptocurrency platforms you can use for investments. However, to clarify everything, we will show you which are the best options for you.
- Binance: Is the world’s largest cryptocurrency exchange platform that involves trading volume, which has been around since 2017. Binance has about 29 million users and offers a user-friendly platform that is easy to understand. After you set up your account, you can choose if you want to use the lite or advanced version of Binance. Keep in mind that some cryptocurrencies require you to use the advanced version of the platform.
- Coinbase: After Binance, a widely mentioned platform is Coinbase. Coinbase both has its free and pro versions. It’s a highly secure platform and easy to use for beginners with different levels of knowledge. The platform offers around fifteen cryptocurrencies available and allows you to use them without restrictions. Coinbase pro includes a fee you need to use, but does have some additional features.
- eToro: After Coinbase and Binance, we have eToro, a super popular platform for trading stocks. More than 10 million users use the platform and have many interests. However, a slight downside with the platform is that it can’t be used once you live in Turkey, Japan, Israel, Canada, etc. Unlike fiat currencies, cryptocurrencies are more limited to use in different countries.
- Gemini: This is another popular platform that allows you to invest in cryptocurrencies and was one of the first major cryptocurrency platforms, being amongst the largest by asset size nowadays. Gemini supports most large cryptocurrencies and once you open your account, you can earn up to $10 after you trade in $100.
Additionally, some platforms might require you to buy USDT and convert them to a cryptocurrency, so it’s important you know that before investing. The same goes for withdrawal purposes. You have to initially convert them to USDT, to be eligible to withdraw your investment if you plan on doing so.
2. Set a goal
No matter where or how you invest, you must always have a goal. Before you plan to invest, answer the following questions:
- What are your goals?
- What kind of objectives do you have?
- What are you trying to achieve with your investment?
- What makes you want to invest in cryptocurrencies?
After you clarify and answer the following questions, your path to becoming a better investor will be clear. In addition, it’ll be a guideline for your future decisions and why you should want to buy and sell cryptocurrencies.
3. Read more about the project’s website
Before investing in any cryptocurrency, it’s vital to read more about its projects and future plans. It’s pretty easy for many people to create their own cryptocurrencies and be serious about it, but their future projections are all that matters. There are more than 13,000 cryptocurrencies in the world right now, and it’s important to see what the future holds.
What can you do to clarify whether you should invest in that cryptocurrency? Here are some of our suggestions:
- Read the white paper
- See the coins objectives
- Identify who are the team members and partners
- Identify if it’s up to date or not
- Make sure there aren’t any spelling errors on the website
4. Create your crypto trading strategy
It’s difficult sometimes to figure out what type of crypto strategy you need to follow for the best results. This is because so many people are waiting to buy from you or take your money. It’s important you never fall into the trap of buying or selling on a platform that scams you. Also, paying close attention to the platform you invest in is important.
Crypto scams aren’t uncommon and can happen at any time. Reports show more than 45,000 scams were conducted between March 2021 and March 2022. Therefore, setting up the right strategy on where you’ll buy and sell your cryptocurrencies is vital.
Take a step back, look at the platform and project. How many users are participating in it? What kind of problems is it solving? Then, avoid investing in any coins that are promising too much.
5. Invest safely
If you want to invest in crypto, you need to feel secure and eliminate the risk of making the wrong investment. If you want to make sure your money is going to the right place, here are a few steps to follow:
- Use a secure device: WiFi networks and public computers can expose you to potential fraud. For example, whenever you invest in a cryptocurrency, you must input your personal information, so the last thing you want is hackers to get a hold of it. Therefore, it’s highly important to have a virtual private network (VPN) that helps you set up a secure connection between you and the internet and keeps your private information safe and sound.
- Manage your budget: No matter where you invest, your budget needs to be well-planned and continually analyze your financial situation to see what you can afford and how you can afford it. The investing world is complicated, and it’s never a good idea to invest more than you can handle.
- Choose where you will store your crypto: Whenever you invest in crypto, you need to identify where you will store your cryptocurrencies. This can be in a web-based wallet hosted by your platform. Many do not worry about this too much, but it may become problematic once you discover that you need to withdraw your coins. Therefore, you need to pay close attention to your wallets so your cryptocurrencies are safe offline.
- Ensure the platform you choose has a good reputation: In business, reputation is everything. If your business reputation isn’t good enough, in that case, the platform you are using to invest in cryptocurrencies, then you will undergo several issues. First, do enough research to identify if the platform you are using to invest in cryptocurrencies has had security breaches in the past. It’s vital to pay close attention to it.
6. Read more about the white papers
A crypto white paper is probably the most important tool for evaluating a cryptocurrency because it gives you a clear picture of why you should invest in that cryptocurrency. In other words, it’s a document that outlines the strategies and goals of the cryptocurrency’s usage.
Whitepapers are the road map of a token and one of the first things investors will pay attention to. The document will show you the supply limit of the token and how it’ll be distributed. Additional information includes token minting, burning, how it affects the ecosystem, etc.
However, remember that there are white papers with technical information, but it doesn’t mean you need to understand every aspect of it. The idea is to understand your goals and how you can achieve them.
Also, remember that any cryptocurrency that doesn’t have a white paper is not a safe investment. Even if there is a white paper, you need to carefully read through it to identify if there are any grammatical errors. If so, stay as far as you can from this investment!
7. Visit their social media channels
To stay updated in your crypto community, it’s important to try and visit their social media profiles. The most common case with cryptocurrencies is that they’ll usually be on Reddit, Instagram, Twitter and even Discord.
Check out users’ comments about the projects, how frequently moderators answer questions, what kind of events they are setting up, etc. For instance, if you see that questions aren’t getting answered, users are leaving bad comments, it’s best to stay away from that investment.
Overall, it’s obvious that if you see many people saying positive things about the projects, why not invest in them, right?
Is it safe to invest in cryptocurrencies?
If you know what to look for then you might find a crypto that works for you but every investment has risks. As a final word, you got to see our seven tips on how you can safely invest in cryptocurrencies and the methods you can use to secure your investments. Every investment has a risk, but the most important part is always to do enough research before investing.
Self-confessed Forex Geek spending my days researching and testing everything forex related. I have many years of experience in the forex industry having reviewed thousands of forex robots, brokers, strategies, courses and more. I share my knowledge with you for free to help you learn more about the crazy world of forex trading! Read more about me.