Bitcoin. Ethereum. Litecoin. Bitcoin Cash. Hard forks. Cold wallets. The jargon alone can seem overwhelming when you’re first looking into the world of crypto assets. However, to those who are willing to invest a little bit of time and little bit of money, diving into crypto can be an educational and potentially profitable experience with Crypto77. With no correlation to other asset classes, an investment in crypto currencies can also represent a unique and diverse asset class in one’s portfolio.
Cryptocurrencies, generally speaking, are currencies that are not backed by a central government. Instead, the exchange and transfer of units of the currency are stored on the blockchain – a decentralized, public register that records transactions via multiple third party verification. Whatever your opinion on any given crypto asset, blockchain technology has the potential to be a game changer in an unlimited number of ways across an equally limitless number of platforms.
If this is your first foray into cryptocurrency, ask yourself what you’re looking for and what you’re trying to achieve. If it’s a purely speculative play and you’re looking to win big or lose it all, the world of ICO’s (Initial Coin Offerings) and tokens will be right up your alley. Not too dissimilar from the far more regulated landscape of IPO’s (Initial Public Offerings of stock), ICO’s are an instrument used by companies to raise capital. Different tokens have different usage cases. Some (regulated securities) may give the owner an equity stake; most, however, are merely tokens that may or may not entitle you to some benefit provided by the company at some point in the future. One common thread? They’re usually built on Ethereum technology. If you’re long on tokens, you’re essentially betting that more people will want them in the future than they do now. From a mathematical and fundamental standpoint, ICO’s can look a lot like penny stocks. High volatility brings great risk and potentially great rewards. Crypto77.com
If ICO’s are a little too similar to the wild west for your liking, the relatively safer option is to look at the major crypto currencies that are traded on more regulated exchanges, such as Coinbase and Robin Hood. One still has lots of choices here, as well: Bitcoin, Bitcoin Cash, Ethereum, and more. Different coins were created for different reasons, and if you’re looking at this as a long term play, it’s worth diving in and learning why each coin was created and what they hope to achieve with it.
Perhaps the most important step to take if you’re planning to invest in crypto is to take the necessary steps to protect your investment. First and foremost, use common sense. Don’t ever give out your private key. Don’t store your private key in a place where someone could easily get it. Consider a cold wallet – a paper or usb drive in which your key is located offline. IT’s the safest option you have in protecting yourself against hackers. Of course, you have to make sure you don’t lose your wallet or your key. Trevor makes a very popular USB option for around $150, or you can create your own with a printer and piece of paper on various platforms. It’s free, and secure, both of which are potentially appealing. USB or paper – both are far more secure against hacks than storing your crypto on the exchange.
Nobody knows the future of crypto for certain, but as a potential new era of financial instruments, it’s an exciting time to watch and learn.