Basic Rules for Investing in Cryptocurrencies

Investing in cryptocurrencies, even the most popular ones, requires experience in this area. Once you master the skills, gaining one or another experience, you can make a smarter and potentially profitable choice of a crypto asset.

With a cryptocurrency market capitalization of $ 2 trillion and a selection of more than 10,000 coins and tokens, many large and small investors with them are increasingly investing in cryptocurrencies. The results of these investments do not always bring the desired results. Since the times of a banal holding, when many speculators rushed in pursuit of easy money, with the dizzying growth of altcoins, are long gone. That at one time also gave an incentive to purchase cryptocurrencies, on the emotions of the general hype and without checking, to make rash purchases. Despite the fact that it is strongly discouraged to do so. 

If you do not understand what you are doing, how to minimize losses and do not follow the recommendations, it is better not to do it. Let's take a look at the basic rules for investing in cryptocurrencies. 


Buy low, sell high is a good strategy

This may sound traditional, but when it comes to cryptocurrencies, the basic rule is “buy low and sell high”. This is easy to understand.

If you want to invest in cryptocurrencies, you must first determine when to buy at a low price and then sell at a higher price.

This concept is applicable to cryptocurrencies because their nature is unpredictable and price fluctuations occur constantly. 


No room for emotion 

Emotions are always harmful to the investor. If you are driven by emotions, you may be wrong and the investment is not for you.

We've all heard the term FUD, which means fear, uncertainty and doubt. These are the most common emotions an investor can experience. Like anyone, we are full of enthusiasm, anxiety and despair, but when it comes to investing in cryptocurrency, we should only follow cold calculation. 

Therefore, be afraid of wolves, do not go to the forest. Analyze the market and make an informed choice. Letting your emotions make decisions for you is a bad job. 


Don't fall for FOMO

FOMO - fear of missing a chance, opportunity. This fear arises when we believe that all good things happen during our absence. FOMO starts when the price of a cryptocurrency rises and forms the perception that everyone is selling. You may feel compelled to sell, worrying about missed opportunities. FOMO will appear when you see a cryptocurrency that you have not invested in and has skyrocketed in value. Then you sell your asset in order to have time to buy that altcoin on the rise. 

Avoid FOMO and stick to your deliberate choices.


Stick to the plan

A cryptocurrency investor must have their own strategy, which must be strictly adhered to. The cryptocurrency market is very vector and moves in different directions, it is not permissible to change the strategy with every market change. 

Therefore, it is necessary to develop a strategy and strictly adhere to it. Formulate your investment strategy based on your preference, long-term or short-term investments, define a sell stop loss when the desired price is reached.  

Stop loss will help you not to act impulsively, but to stick to the set goal.


Long term investment

In 2009, when Bitcoin appeared, few believed in its future. But time passed, and with it Bitcoin, changing the history of investments and growing rapidly, despite fluctuations in price. The lucky ones are those who invested in the early days of the Bitcoin era, as this investment has brought fantastic returns.

Cryptocurrencies are becoming more popular and legal, even many banks and large financial institutions have started to provide services in digital currencies. 

Consequently, this factor will contribute to the growth of popularity and prices, which allows considering the possibility of a long-term investment. 

Hodling, which is slang for "storing" cryptocurrency. In the future, your patience will surely be rewarded. 


Expand your horizons 

Investing in cryptocurrencies is associated with high risks, a decentralized investment portfolio, a logical decision. Decentralized portfolio, reduces the likelihood of asset loss. Diversify your portfolio by investing in various cryptocurrencies. 

The digital asset market has more than 1,500 cryptocurrencies, using diversified technologies, you can easily find interesting options. Since cryptocurrencies are interconnected and their performance is comparable, as well as to reduce risks and increase profits, it is advisable to invest in 5-7 coins.

Decentralize your portfolio by investing in various tokens.

You can only invest what you can afford

Taking loans for investment in cryptocurrencies, in some cases, with a successful investment, of course, can help you get rich. But do not forget, the cryptocurrency market is extremely volatile and full of risks, which can quickly enrich you, can also make you poor. 

Decentralized finance and cryptocurrencies are subject to various problems, including legal requirements of regulators, scammers, hackers and many more. 

Crypto assets require careful and prudent investment. Therefore, your best decision will be, an investment within the amount that you can afford to painlessly lose. 

The amount of investment, in case of a negative outcome, should not affect the quality of your life. 



Having learned how to analyze the market, make informed decisions, not succumb to panic or regret, controlling what is happening. You will significantly increase the chance of successful investment. 

If you decide to try your hand at the world of cryptocurrencies, do it with a trusted and reliable partner - HUOBI .


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CoinShark is not responsible for the content, accuracy, quality, advertising, products or any other content posted on the site. This article is for informational purposes, prepared on the basis of materials and information from open sources. Cryptocurrency is a high-risk asset, investments in it can lead to losses. Readers should do their own research before taking any action.