How to Tell That Cryptocurrency Isn’t for You
Updated on November 17, 2022 | by Olivia Reeve
In recent years, the world has seen a growing number of people taking interest in cryptocurrency investment for several reasons. While many investors are attracted to digital currency primarily for its investment potential in terms of returns, there are some factors to take into consideration when it comes to how these returns are attained.
Predictions today can do well in providing bettors with the forecasting they need for upcoming bets; however, going into crypto investing doesn’t mean that you can’t get the guidance you need to help you decide whether cryptocurrency investing is for you or not. In this article, we will be providing you with four signs that will tell you if cryptos will be worth your time and money or if they won’t.
Your Four Signs
Investments aren’t for everyone and this remains the case if you’re looking into stocks, foreign exchange markets, or cryptocurrencies. Depending on the type of investor you are, these traits and habits will provide you with the direction you need to decide if this will be the right choice for you.
You Don’t Own a Portfolio of Traditional Investments
The global market consists of many investments and some investments will prove to be riskier than others. When you look at cryptocurrencies, these can be the riskiest to consider because they’re highly volatile thanks to their speculative nature and virtual coins. Because of this, it’s always best to start by investing in more traditional markets before going into cryptocurrencies. These include investment markets like bonds and stocks.
If you’re already in a position of owning a diversified portfolio of investments that have proven to produce successful results, then you’re likely to stand a better chance of doing well in crypto investments and building your wealth in due time.
You’re a Risk-Averse Investor
Are you uncomfortable with the idea of taking risks? Are you likely to sell your digital assets once you find any sign of decline in the price of your crypto? If you’ve agreed to any of these questions then it’s likely that cryptocurrencies aren’t for you. When it comes to the crypto market, panic and acting impulsively are two things you should avoid doing at all costs.
By being incapable of sticking to your strategy, especially in times of uncertainty, you might risk losing money that you could have recovered had you chosen to wait out the temporary price plummets. By identifying yourself as a risk-averse investor, you can help avoid volatile assets.
You’re Hoping to Make Quick Money
In a lot of cases, most novice investors aim to invest and buy trending cryptocurrencies so they can sell them quickly and generate a profit in the meantime. If these are your hopes, then it’s worth noting that you’re highly mistaken and are likely to encounter more losses than gains.
When it comes to investments, short-term trading tends to be a recipe for disaster. Timing your purchases is nearly impossible to do and all you can do to make the experience worthwhile is to use strategy, skill, and technique. The secret to successful crypto investing involves you needing to invest more long-term so you don’t aim to time everything.
Your Cryptocurrency Choices are Influence-Based
Many people consider cryptocurrency investments for the wrong reasons. By buying into what celebrities or influencers are saying, you’re likely to end up making poor decisions based on what others are claiming their success to be based on.
The saying, “Don’t believe everything you read in the papers” also translates to what you read and see on social media. Many celebrities and influencers receive financial incentives for such promotions and all this happens while you’re assuming that their success is influenced by what they are selling to you at the time.
In other cases, you may find that these celebrities do have good motives; however, they may have investment goals that are completely different from yours. Therefore, avoid making crypto decisions based on what celebrities, influencers, or others are saying about a particular digital currency.
If you happen to identify yourself with any of the four signs above, then you might want to rethink cryptocurrency investments. While this may put you off of investments as a whole, you can find investment markets that will suit the goals and needs you’re looking for.