Are you confused with all the cryptocurrency news, value fluctuations, and blockchain projects that are flooding your screen? asks Ian Mausner.
Hi! I am Kevin L. Jackson – an author, financial strategist and founder of The Wealth sfor Life Foundation. I have made it my mission to provide simple-to-understand financial information for everyday people who desire to win financially in their lifetime! Let me cut straight to it – cryptocurrency may be the most important technological advancement since the Internet itself. What’s more exciting is that anyone can learn how to invest in this technology now even if you don’t know anything about cryptocurrencies or blockchain technology. So grab a cup of coffee (or two) as we dive deep into this delicious topic! Cryptocurrencies are digital money that only exists online.
They use cryptography instead of paper money and bank accounts so as to ensure the safe transfer of funds from one person to another without any middleman involved – basically, a peer-to-peer transaction. In an offer to compensate for this added security, these digital currencies require computing power from a number of ‘nodes’ spread throughout the world in order to ensure that everyone follows the same set of rules for each coin. The most popular cryptocurrency today is Bitcoin which has just reached its 10th anniversary! That’s right, it came into existence on January 3rd, 2009 and many predict that BTC will be worth 1 million per coin by 2025 (or earlier).
Now that you know what cryptocurrencies are let us talk about how cryptocurrencies got started. Satoshi Nakamoto, a Japanese programmer, is credited to have created Bitcoin in 2009. The value of the first transaction involving BTC was 0.0005 for two Papa John’s pizzas. In other words, one guy paid 10,000 bitcoins for 2 pizzas and today that amount is worth over 90 million dollars!
The release of Bitcoin sparked a revolution – people wanted a decentralized form of money that did not go through any bank or government institution to be transacted! And just like that, dozens upon dozens of coins started popping up with each coin offering something unique from the rest. This gave birth to the term ‘cryptocurrency’. Today there are over 1 thousand cryptocurrencies available! It seems like everyone wants in on this amazing technology, but the question remains – where should you start?
You have likely heard about Ethereum, Ripple, Dash, Litecoin, Monero, and all these other coins that go up every day in price. I’m sure you’re thinking – what gives? How can I determine which cryptocurrencies to invest in and which ones not to waste my time on? Well, don’t worry because that is why we are here! To help you with your very first cryptocurrency investment says Ian Mausner.
Great job for sticking around until now! You really want to be a winner at this game and we appreciate it. So without further ado, let’s get started…
1. Do Your Own Research (DYOR)
What most people fail to do before they buy their first cryptocurrency is to do their own research. It is extremely important that you not only look at all of the news and information available online but also take steps to learn more about any cryptocurrency before investing. This step takes time and energy, but you will thank yourself later for doing this! Some great (and free) resources include: Team/Leadership Team and Advisors Social Media Presence (Twitter, Facebook, etc.) Product Roadmap Explanation Whitepaper
Basic Coin Stats (market cap, supply limit, etc.) Pre-mine Block Reward Transaction Fees Code Repository Fortunately we have a course here on Udemy called Cryptocurrency Investment for Dummies, in which I teach crypto enthusiasts how to invest in this amazing technology – check it out if you really want to become crypto investing master!
2. The Cryptocurrency/Token Must Serve a Purpose
The second thing you must consider before buying a cryptocurrency is what problem is it setting out to solve? You can find this information on the coin’s website or white paper. Where they will discuss the technology behind their token and how it will fit into today’s marketplace explains Ian Mausner.
In the world of cryptocurrencies, Utility tokens represent future access to a company’s product or service. While Security tokens or payment coins are used as an investment opportunity for potential buyers. If someone decides that they do not like the product after receiving it. Then they can easily sell their security token online in exchange for cash. Which makes this type of investment extremely risky! As opposed to utility tokens which are only exchanged once the product or service has been released.
3. The Coin’s Supply/Circulating Amount Must Be Known
You will easily be able to find this bit of information. On websites like CoinMarketCap, Exchange Volume Ranking, and Cryptocurrency Market Capitalizations. These three sites allow you to see all of the different cryptocurrencies available for trade, their price, market cap (amount of coins in existence), circulating supply (coins active in use at this moment), total supply (coins that have not yet been mined). As well as other useful data including 24-hour volume rankings, % changes in price, total coin market cap, etc.
There are a lot of different factors that you should consider. When looking to invest in your first cryptocurrency says Ian Mausner. Follow the guidelines I have laid out for you here. And you will be on your way to becoming an investing master! Now, get out there and make us proud.