How to invest in cryptocurrency is a dilemma that must be addressed. If you are not aware of things to know before investing in cryptocurrency, you might be frustrated by the system.
Cryptocurrency is a very volatile market. The market keeps changing every second.
What started as a booming market early last year has lost more than 70% of its price.
Bitcoin reached a new all time high of $68,000 in November 2021 but currently trading below $19,000.
Another tragic occurrence is the de-peg of LUNA UST and perpetual loss of value of LUNA now called LUNA CLASSIC.
Even those that know how the market operates still lose their money.
There is a clear strategy on how to survive during dip and how to manage your cryptocurrency portfolio.
The same market that is giving some people money is the same market that is making some people lose their fortune.
Below is a strategy used by pro traders in reducing the risk. Read till the end.
How to invest in cryptocurrency
Investing in cryptocurrency is as easy as buying and selling and as the word trading implies but you dont invest in cryptocurrency like other commodities.
In other to answer the question, “how to invest in cryptocurrency”, here are 3 things to know before investing in cryptocurrency.
Why do I want to invest?
Have you ever asked yourself this question?
Unless you are able to know your reason for any action, you might not be able to withstand the challenges that come as consequences of your decision.
Every action requires a reason.
Do you want to invest because of the money?
Yours might be to prove to others that rejected you.
Or do you want to be financially free?
To some people, investing in cryptocurrency is their tool against poverty.
While some people started cryptocurrency so as to meet their needs.
Take a little moment right now and think deeply about why you want to invest in cryptocurrency.
This is the most important thing to know. Do take it really seriously.
For how long do I want to invest?
The answer to this question will be determined by your stated reasons.
If you are not convinced enough about your reason, here is another opportunity.
Do you have the capacity to leave your fund for years?
Can you survive without touching this money?
You can read about the easiest way to make money in crypto.
Are you investing for the long term or short term?
For clarity purposes, long term investment is more profitable and prone to lesser risk than investing for short term.
Though, investing in the short term might give you immediate returns but it requires a certain level of professionalism in trading.
How do I want to invest?
If you’ve answered the previous question, it is time to know about the process.
Part of the way through you can invest in cryptocurrency is dollar cost averaging.
Dollar cost averaging (DCA) is a technique in trading which means periodic buying of a particular cryptocurrency which can be weekly, monthly, quarterly etc.
The aim of using DCA is to reduce the weighted cost of purchasing a cryptocurrency. For instance, if you bought 1 btc @ $60,000. Bought another 1 btc @ $40,000 and bought another 1 btc @ $20,000. The total cost of the 3 btc is therefore $120,000 which means based on DCA, the price of 1 btc will be $40,000.
Waiting for the price to reach $60,000 might be a very long wait but based on DCA, you will be in profit at any price above $40,000.
Low risk investment in cryptocurrency
There is a clear path through which you can also invest in cryptocurrency without risk.
Kumo offers an investment package where you can earn up to 30% ROI on your stablecoin. So rather than thinking about market fluctuation, you can be earning on your BUSD which will be paid monthly to your wallet.
Any other benefit?
Yes.
If you are thinking of investing for the long term, you might use your monthly return to buy different cryptocurrency using Dollar Cost Averaging.
Regardless of the method you choose, don’t forget to always do your own research.
The next thing after you’ve provided an answer to this is to take action.
There will never be a result even if you have the best plan on paper.
Register on Kumo wallet now and buy the cryptocurrency of your choice.
About Kumo
Kumo, registered as Kumo Technologies Inc in Delaware, U.S. is a fiat and crypto social payment app which allows users to exchange fiat (NGN) to crypto, save and earn interest in dollar with as low as $5, utility payment such as DSTV subscription, airtime, data among others.
Kumo wallet is your all-in-one social payment app for seamless payment solutions.
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