When you first start crypto trading, you are likely to learn some harsh lessons. The volatility in prices coupled with a 24/7 market means that you always have to be on your toes and ready to react. Whilst some people can make a lot of money, it always comes with risk, and you can be sure that there are just as many people who have lost a lot of money as well. Before you begin, here are five tips you should know.
Before investing in a project, you should do a huge amount of research to ensure you are fully aware of all the positives and negatives. This can be particularly difficult. Finding accurate sources on projects is notoriously tough.
Some people are so invested in projects – even the terrible ones – that they will not believe a bad word said about them. Instead, they will consistently talk about how their cryptocurrency is going to change the world and make them a lot of money at the same time.
You will often find these people lurking on the usual social media sites such as Twitter or Reddit.
But what key points should you be looking for? Firstly and obviously, you should look for a strong product. Too many cryptocurrencies are currently trying to build a new and improved version of what is already in existence. Yet their project is not only pointless, but worse than the current systems we have in place.
Secondly, you should check how the cryptocurrency was created. Was it through a pre-mine with the developers holding the largest stash ready to dump on unsuspecting investors? Perhaps it was an ICO where they raised millions, but since then there has been little to no advancement?
How consistent is the development team? Are updates both to the code and to the community provided on a regular basis? Are they open and honest? Or do they promise to tell you to wait and see but guarantee things are in the pipeline?
What is the community that surrounds the cryptocurrency like? If they behave more akin to a cult than sensible adults, it…