A cryptocurrency (or crypto currency) is a digital asset designed to work as a medium of exchange using cryptography to secure the transactions and to control the creation of additional units of the currency. Cryptocurrencies are classified as a subset of digital currencies and are also classified as a subset of alternative currencies and virtual currencies. Bitcoin became the first decentralized cryptocurrency in 2009.Since then, numerous cryptocurrencies have been created. These are frequently called ”altcoins”, as a blend of bitcoin alternative It is used primarily outside existing banking and governmental institutions, and exchanged over the Internet.  It is definitely by far the hottest Investment product currently available in the market.

Why is Cryptocurrency in News as an Investment Option ?

Read some of the news and articles which flourish in the news and online media regarding the new currency :

• 200% return in 10 hours – Invest and double your BTC‎
• Bitcoin Price Targets $4,400 Despite Dipping Hash rate
• ICOs, the New Investment Tool in Venture Funds’ Chest
• Vietnam is Preparing to Legalize Bitcoin
• Canada Looking To Classify Digital Currencies As Securities
• Bitcoin Price Will Reach $5,000 this year: Gatecoin CEO Aurélien Menant
• Since 2011, Bitcoin generated an increase in the value of at least 25,000 percent!!
• Russian Deputy PM Says He Supports a State-Backed Cryptocurrency

It sounds interesting when as an investor we can foresee a good amount of investment in this uncertain world. As this is petty a new phenomenon, more and more people will join this. This can result in a massive growth of income with a very high risk.

Since 2011, Bitcoin generated an increase in the value of at least 25,000 percent.  The value of Ethereum value shot up by 2,700 percent since May 2016,. That’s maybe the fastest rally a cryptocurrency ever demonstrated. If as an investor we calculate the increase in market cap of all the cryptocurrencies since mid-2013, the increase is around 10,000 percent, which itself is a phenomenal growth!!

I personally feel investment in Bitcoin or alt coins is alike investing in a venture as a venture capitalist. Holding coins means to have a share in this venture and its growth story which is at the initial stage of growth. If according to news in web media, Bitcoin ever even replace monetary reserves of central banks or becomes the dominant currency for international trades , the value of one Bitcoin will be far beyond 10,000 Dollar

How to Invest in Cryptocurrencies?

If as a risk-taking investor, we understand the potential of cryptocurrency as an investment option and if you believe in their vision of money, today might be the best day possible to start investing in it. With this I would also like to update my investors that this is not a normal investment.  The volatility grossly exceeds far more that any of any other investment class available in the market. It is to some part unregulated and an unorganized market with no government control and regulation.

So an important advice to all my viewers is to only invest as much that you can keep on living and be if all of it goes to zero. Or in other simpler words invest only that part of the money which is kept spare and can be invested in a high risk business, where the changes of losing capital is more with a high return expectations.

Why to Invest in Cryptocurrencies And Why Not?

Some of the good reasons which I can highlight for investment in Cryptocurrencies are

• A high return on your investment is one of the guiding force and the main reason.
• Hedging your net-worth against the inflation
• I personally support the social vision behind cryptocurrencies of having a free and hard money for the whole world without any interference of any government and agencies

A caution should always be made before investing in cryptocurrencies. Many people fall victim to the hype surrounding every cryptocurrency-bubble. There is always somebody captured by FOMO (fear of missing out), buying massively in at the peak of a bubble, just in hope to make quick money, while not understanding cryptocurrencies at all.  I personally suggest “LEARN THE ART AND GAME BEFORE INVEST”

Cryptocurrencies Portfolio Building

Until late June 2016, Bitcoin was the only cryptocurrency available in the market. Other cryptocurrencies also called “Altcoins”, have just been penny stocks mostly used to pump the price and dump the coins.  So if you want to invest in cryptocurrencies, Bitcoin is still a standard item of every portfolio. In every well-balanced crypto-portfolio today you find other coins, like:

• Ethereum
• Ripple
• Litecoin
• Dash
• Monero
• And more

Let’s begin with buying Bitcoin. That’s the easiest part. There are many websites and trading tools available in the market which helps an investor for buying and selling of the currency. There are hundreds of alt currencies also out there. If you want to go to a crypto supermarket, where you can buy and sell most of them, you need to register at what is usually called an “altcoin exchange”.

Some of the tips and suggestion which I suggest to follow for selecting a cryptocurrency are mentioned

• See the “market cap” of the targeted currency. Market cap means the value of all token available in the market.
• As this is a relatively new concept, the best thumb rule strategy is to focus on the ten most valuable currencies in your portfolio. If however some time can be spared for research, read details, opinion and then decide
• Always look for an alt coins which has a transparent technical vision, an active development team, and a vivid, enthusiastic community
• Take some time to watch. Don’t buy in, because there was a dip. There might be another. And don’t buy in, because you fear that it will explode tomorrow. Don’t sell too early. Hold. The monetary revolution has just started.
• It is not a good idea to buy in at the peak of a bubble, and usually, it is also not a good idea to buy it when it is crashing. “Never catch a falling knife”, as the trader’s wisdom says.
• Avoid buying cryptocurrencies through a MLM system, As a prudent investor, Beware of them!

Investor discretion is suggested in any investment.

Read more on Bitcoins here.

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