Cryptocurrencies are very volatile
In cryptocurrencies, a volatile market means that prices can change quickly and dramatically.
Put simply, buying with cryptocurrencies is not as easy as buying with euros.
This is because cryptocurrencies are still very new and different from traditional markets. For example, there are no regulations that protect the investor in the event of a loss of value.
In fact, there are no guarantees on how long cryptocurrencies will exist! Because of this uncertainty, it is important for new investors to understand that their investments could be lost without warning and therefore use caution when deciding where to invest their money.
Diversify into various currencies
As with traditional investments, it is also important to diversify in the world of cryptocurrencies to make your portfolio safer: that way, if one of your investments fails, you will only lose part of what you invested, instead of the whole of it!
Investing in stablecoins
For example, Tether is pegged to the US dollar in a one-to-one ratio and is backed by real deposits in banks located in Taiwan and Poland.
This means that you can exchange your stable currencies for real money at any time, without losing value due to market volatility: it's like having your money in a bank account, except that there is no central authority guarding your funds!
Keeping an eye on the market
The best way to keep an eye on the market is to use a cryptocurrency tracker. This is an application or website that displays real-time data on the prices and market capitalization of various cryptocurrencies.
Many free options are available, such as CoinMarketCap and CoinGecko, but some also have premium versions with additional features (such as charts).
Whichever tracker you choose, make sure it is reliable and easy to use, so you don't waste valuable time researching investments.
It is also a good idea to check the daily price changes of each currency and its market capitalization, i.e. the total value of all tokens currently in circulation divided by the number of tokens in circulation (e.g. if there are 100 million coins in circulation and each one costs USD 0.01, this equals USD 1 million).
This information can help determine whether an investment may be worth it, as some coins may grow faster than others due to increased demand from investors who see the value of using these coins over other types of payment systems, such as credit cards or cash transactions.
Ultimately, this can be an excellent opportunity to enter the market soon. If you are willing to take some risk and monitor your investments regularly, investing in cryptocurrencies could be for you.