Crypto has taken the world by storm, and Australia is no exception to that. It’s so mainstream in Australia that a staggering 18% of the population of Australia owns some crypto coin. If you are still new to cryptocurrency, you must tread cautiously because you will encounter many things and words that you have never heard before, which can overwhelm you quickly.
Before you start crypto trading Australia, it’s essential to understand how cryptocurrency works. This article has five tips for beginners to help them understand and invest in cryptocurrency.
- Understand the underlying blockchain technology
It’s important to understand blockchain, cryptocurrency’s underlying technology, before actively investing in it. You don’t need to go into its nitty-gritty details; instead, try to learn more about how blockchain works and how it has changed the way people transact today. You can learn about blockchain by reading articles from crypto specialists, engaging in online forums and watching videos.
When you start learning more about it, you’ll see why big businesses and governments are looking into different ways to integrate blockchain into their existing systems. You’ll also learn why banks are terrified of blockchain and cryptocurrencies and why they believe they will harm their growth.
- Only invest what you’re willing to lose
Before you invest your life savings in cryptocurrencies, you should know that the market is quite volatile. Furthermore, market sentiments, hype, and even a single tweet from an influential individual can all contribute to increased volatility. That is why, while investing in crypto, it is critical to understand the rule of thumb. Only invest money that will have a minor impact on your life if you lose it.
- Make a long-term investment
As a cryptocurrency investor, you must understand that cryptocurrency is not a get-rich-quick scam, despite what many people may have told you. Many people regard cryptocurrency as ‘sour grapes’ that they cannot consume. That is why they condemn it to appease their egos and conceal their lack of understanding of cryptocurrency.
When it comes to crypto trading, you must have the patience to HODL. You don’t want to be the person that bought BTC for $0.10 in 2000, sold it for $0.30 and then regretted their decision when BTC reached $8 in 2011. He would have millions of dollars today if he kept that amount of BTC. As a result, you should never invest short-term unless you have sufficient intra-day trading experience.
- Stick to reliable news sources
The essential underpinnings of traditional banks and the way monetary transactions have been done in the past are being challenged by crypto. As a result, several news outlets try to scare people away from Bitcoin by exaggerating information. It’s also essential to keep up with international news because it can significantly impact the value of cryptocurrencies. As a result, it’s critical to select news sources that are reliable, unbiased and trustworthy. To become a successful crypto trader, adhere to the truth and steer away from crypto haters.
- Carefully select your crypto wallets
There are numerous crypto exchanges in Australia that provide crypto wallets to store your cryptocurrency both online and offline which makes crypto trading in Australia so much easier. Hot, offline wallets are a preferable option for newcomers because they are more practical, adaptable and easy to use. On the other hand, cold wallets provide superior protection against unwanted access, such as from hackers. You should try both sorts of wallets and select one that meets your needs and is convenient.
Cryptocurrency investing can be challenging at first, but you can quickly understand how to invest or trade crypto effectively once you know your way around it.