PH Cripto

How to know Which cryptocurrency to bet? Some basic rules

The optimism in me wanted to see the new financial opportunity and dive in head first before doing enough research to understand no matter which side of the fence this opportunity was a simple fact, WHAT GOES UP MUST COME DOWN!

On which cryptocurrency to bet is one of the first things newbies ask me if they come to discover that I have been working in this sector for years now; there is no single answer to this question, it all depends on the person to whom you are asking it.

In principle the bulk of the fans would say that the only currency worth betting on is bitcoin, but things are not exactly like that; to make the difference is first of all what kind of investment you have in your head, then consequently you can choose which currency to bet on. For those with a low risk appetite and not aiming to make necessarily astronomical profits bitcoin remains the safest currency to bet on; meanwhile it is the first cryptocurrency on the market, both in terms of seniority and capitalization, and then it is the most widespread and the most used.

Obviously we can no longer wait for the astronomical profits we once had from BTC, if we consider that current prices are around 10 thousand dollars, even assuming they would squeeze 100 thousand dollars it would be a profit of ten times the post, high, of course, but nowhere near comparable to the profits made by those who bought it years ago.

Clearly, to pursue the blow of life, the one that changes things forever, we must instead focus on a less solid bitcoin coin and take some risks; the other thing that needs to be considered is the time horizon in which we intend to act. If the idea is to enter and exit the market within a few weeks or months then you are essentially trading, an investment necessarily has a longer time horizon. Low capitalization coins, which today are worth a few cents of a dollar, in a moderately long period of time, let's say from five to ten years, could really give dizzying profits; let's imagine even to buy $ 100 of a coin that today is worth $ 0.10, if from here to ten years that same coin came to be worth even only $ 10 our $ 100 of investment would have become 10 thousand.

This helps us to understand how much the initial capital is important, to get to earn big amounts with small investments, like just the hundred euros, you also need to have a little luck and invest in coins that must really have a huge success, if not superior at least comparable to that of bitcoin. To aim high, without having to rely too much on luck, we need to move towards investing figures in the order of a few thousand euros, 2 thousand euros betting on the right currency can easily become 200 thousand within ten years; the problem, therefore, becomes understanding what the right currency is, which is clearly impossible. The only thing we can do is define some basic features that a project must have to get our attention and in any case guaranteed in hand we will have nothing; in a long period of time, like ten years, anything can really happen and a project that today looks absolutely solid can end up in the air and leave us with a handful of flies in hand.

Obviously it is still necessary to restrict the circle of potentially interesting projects to invest in and since this also helps us to reduce the risk of losing our investment, we might as well dedicate ourselves to doing our research well and collecting all the information we need to take a wise decision. The first thing we must do, therefore, is to read the white paper, but always starting from the assumption that it is never the case to take at face value what we find written in this document; the other thing to do and groped to understand who are the key figures behind a given project and define how much we consider reliable (after all we are entrusting our money to him). Behind ethereum, just to give a trivial example, we have Vitalik Buterin, consequently those who invest in ethereum tend to follow very closely what they do and what their main developer says; in addition to this, any partnerships with other companies should also be taken into consideration, as well as exchange platforms that offer listing.

In short, what we have to do, very trivially, is a kind of fundamental analysis to realize if we consider it possible that that particular project will survive the test of time by increasing its value. However, you need to be very careful because even if you do all these evaluations, but the time is wrong to buy the risk and end up under so much pressure that you decide to sell by consolidating significant losses; to understand each other better it will be the case to give a concrete example.

Among the various coins that we have often reported on this site to be among the most interesting for a long-term investment is BAT, the token hooked to the browser for online browsing BRAVE; this project has all the credentials for a long-term investment, it has behind it a group of recognized professionals, a concrete product that is already on the market and is highly appreciated by those who use it, a concrete and plausible industrial growth plan. Yet if someone had bought BAT in April of this year (when it was quoted at its maximum at $ 0.40) it would now find itself having lost half of the investment (since BAT currently shares at less than $ 0.20); the moment in which you decide to buy, therefore, is fundamental, as is the moment in which you decide to sell.

If, for example, we had sold bitcoins in April, when it was quoted at around 6 thousand dollars after buying the December fund at 3 thousand dollars we would have doubled our investment but we would have lost the race that subsequently brought the prices up to 14 thousand dollars.

It is therefore never just a question of choosing the right project, it is also and in some ways above all a question of timing; if you want to earn money by investing in cryptocurrencies, then forget about finding the right online guru who can give you infallible tips, that's not how it works, you will only be able to make a profit in this sector if you know exactly what to do and when to do it. In other words, you have to learn to invest your money.