Thinking of investing in a cryptocurrency? Look at these factors first
In recent years, and especially in 2020, the demand for cryptocurrencies has reached a record high as millions around the globe have shown their interest in digital currencies as assets.
Before you dive headfirst into the world of crypto, you should keep these 3 key points in mind.
The first thing to do before making any investment is verifying the legitimacy of the digital currency. It is advised by experts to invest in currencies that have been around for at least one to two years. Moreover, cryptocurrencies that were present during 2018-2019 hold more credibility because this was a difficult period for the cryptocurrency industry.
The second point to note is awareness of the risk of investing in crypto. Although decentralised finance may be seen as an opportunity for potential growth, this does not necessarily mean that all projects are lucrative, or will offer a positive ROI.
Lastly, it is always beneficial to have a long-term view. Many investments have seen 300% returns after as long as 3 years, and many even experienced losses. Therefore you should conduct your research diligently before investing, so that you understand the market and choose where to put your money wisely.