Nothing should be considered investment or financial advice. Enjoy the ride.
This post is mainly going to be an educational piece on getting people started in Crypto! As Bitcoin and other digital assets increasingly gain popularity with investment firms, hedge funds, retirement portfolios, and traders, more and more people you know will start to take it seriously.
That means they may come to you at some point and ask you to explain things, help them get started, or possibly to invest. It is important you have a game plan ready to go for people that come to you.
You need to consider a few things in particular:
- Who should invest in crypto versus who should not
- What level of knowledge should they have before they invest
- What is the best way to get them started
Therefore, lets move into the first part of weeding out who should invest versus who should not invest.
Who Should Invest in Cryptocurrency
The target audience for people who should seriously look into investing in cryptocurrency are individuals with a healthy risk appetite level, comfortable financial situation, passion & understanding for technology, and long-term investment mindset.
These people in addition should probably be of a reasonable age and not bet on turning a quick profit but jump on board with the decentralized movement, and support the idea of alternative currencies to traditional fiat.
Who Should Not Invest in Cryptocurrency
The people who should not invest in cryptocurrency are people who are in a weak financial situation, strong crowd followers, lack simple understanding for technology, or people close to retirement.
Sorry guys and girls, that means grandma and grandpa should most definitely not be investing their retirement in an extremely volatile market. The simple reason is because they cannot afford to lose that money.
In addition, people who do not strongly agree with the beliefs surrounding the decentralized movement or understand the progress structure for the digital world, should stray away from this market as well. This market is not for the impatient or for those looking to simply make a quick buck. You will inevitably lose all your money with those mindsets.
What Level Knowledge Should People Have Before Investing in Crypto
Once you figure out who should and should not invest in crypto, the next step is figuring out the proper level of understanding investors should have in the market, digital assets, and trends.
I would highly advise people who are new to the market to do a few things.
- Watch the market closely
- Learn the basics
- Study the top assets
Watch the Crypto Market Closely
Before investing in crypto, I personally watched the market, price movements, and development patterns for years. This gave me a huge advantage when I finally decided to invest.
With new investors, I would advise watching the price movements of the market for a couple of months before entering. That will give them a better idea of the extreme volatility and prepare them for what to expect after they put their own money into the market.
Ideally, they should watch and become active in chat groups for much longer before entering, but usually excitement will get the better of them before then. At a minimum a few months should be enough to give them a taste of the market.
Learn a Few Crypto Assets Very Well
While there are thousands of digital assets on the market, it is extremely important to learn a few of them very well.
More specifically, any and all new investors need to learn about the most well known assets on the market in order to give them a strong basis to understand other lesser known assets. Without this foundation of understanding, a newer investor could easily get wrapped up on FOMO which is a very bad thing and a great way to lose all your money.
Therefore, the top assets all newer investors need to dig into are:
The grandfather of all cryptocurrency, Bitcoin is an absolute necessity for investors to not only understand but to be able to explain. Likewise, newer investors need to understand the differences between Bitcoin, Bitcoin Cash, and Bitcoin Satoshi’s vision. This foundational understanding of blockchain, forks, and market manipulation, will save them time, money, and heartache later on.
The first true second-generation cryptocurrency that opened the door to decentralized applications, turing complete code bases, and sent the bull market of 2017 to the moon, Ethereum is another asset to study up on.
Knowledge about Ethereum’s base applications, long-term vision, capabilities, differences from Bitcoin, and history will give newer investors a huge advantage when they read about capabilities of lesser know assets. This will give them the knowledge to keep from getting roped into a project they really do not want to be in and be able to differentiate between lies and truths across the market.
One of the most controversial cryptos on the market, Ripple or XRP, is the first example to a newer investor of a digital asset that is not exactly “decentralized” but still a digital asset. In addition, Ripple is the first asset not looking to replace the traditional financial world but optimize it to a more efficient model. Most people in the crypto market are either strongly against this asset or strongly for it thanks to the XRP army. Although, I still strongly advocate learning about it, the company behind it, it’s history, the purpose of XRP, and what it is replacing in the traditional market.
Foundational Knowledge Of Digital Assets
Once a newer investor has knowledge of Bitcoin, Ethereum, and Ripple, they will have a strong foundational understanding of cryptocurrencies on the market. This will keep them from losing a lot of money by avoiding investing in other forked assets that are copycats to the originals, be able to ignore the buzzwords people use hype up projects, and have an increase in confidence for their investments.
The Best Way to Get Started in Crypto
With the proper knowledge, and the right situation, it may be time for someone to invest into cryptocurrency! While that is an extremely exciting time, it is important to understand the simplest way to get started.
Even though you may know about the market, trends, and the under lying technology, there is still more to learn about trading, placing orders, and the platforms once they get their feet wet.
Start Simple – Use Coinbase
For most people, I would highly recommend using Coinbase to start off your crypto adventure. A few reasons are:
- Easy to connect your bank account
- Insured in case of hacks
- Well known and respected across the market
- Easy to purchase and sell digital assets
- User friendly backend platform and downloadable app for on the go use
- Friendly and supportive customer service
Coinbase has been my go to for purchasing crypto and selling crypto seamlessly. While there are some alternatives to Coinbase, I highly recommend new traders and users stick with the simplest and most trusted platform, Coinbase.
Storing Your Digital Assets
While there are many ways to story your digital assets, my favorite is in an interest account with Blockfi. I wrote a post on this platform I use to store my BTC and ETH in.
The platform regularly pays me out interest at the end of every single month. So far this year alone, I have made an extra $200 just from storing some of my BTC and ETH in an account with them. It is sort of like a high interest savings account. BlockFI, does it right. It pays out it’s users at the end of every month, and account holders can deposit or withdraw anytime they would like.
Personally, this is a great idea to make money work while you sleep while you wait for BTC to go to the moon.