In this day and age where we see new coins arrive on the market with innovative spins, no one can deny that cryptocurrencies have become astronomically popular. In fact, the crypto space has become such an attractive investment opportunity that they’ve become like traditional assets like stocks and bonds and are being treated as such by many investors.
But is crypto a good long term investment? The short answer to that is yes, but only if you do enough research, select the right cryptocurrency, understand the risks, and know where to buy. We’re going to help you do all of that right here in this article.
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What’s the Right Cryptocurrency?
The reality is there might be no coin generating very high returns forever.
Sometimes, traders check the rankings of cryptocurrencies and select the trending ones with high prices.
That may work in some cases, but not always. Why? Because the crypto market is inherently volatile, which means that at times, new coins quickly climb up the rankings but may fall just as fast and take many investors down with them.
It’s vital you choose to invest in a coin that has a solid track record and is consistently among the most valued on the market. For instance, one of the most prized coins is Bitcoin that is becoming even more valuable every day since many investors worldwide persistently endorse it.
How Do I Know If It’s the Right One?
Choosing the right cryptocurrency requires careful analysis, especially for long-term investments. Among the primary methods to evaluate the benefits and risks of an asset is to utilize fundamental analysis. This helps you figure out the coin’s intrinsic value based on the present context and the outlook of the market.
You need to do enough research to understand the direction of the market. For instance, you probably know the maximum Bitcoin supply is 21 million coins. It’s becoming increasingly scarce over time because the supply rate drops by about 50% every four years. That alone demonstrates the coin’s value will most likely grow in the long run.
Bitcoin’s share of the total AUM is currently over $6 billion, making it a solid pick for long-term investments. Of course, a great starting point can be to add Bitcoin along with the other altcoins to your portfolio. Keeping Bitcoins will help save the portfolio’s value in case anything happens to an altcoin.
How High Is the Risk?
Just like any other line of investment, putting your money in the crypto market will never be without risks. However, you can undertake certain measures to curtail that risk and even use the market’s inherent volatility to your advantage.
By doing some research, you can understand the market’s trends and know the answer to questions such as how long should you hold cryptocurrency? In addition, you’ll know how much to invest so that you won’t risk more than you can afford.
Where to Buy Cryptocurrencies?
Again, just like any type of investment, the right platform can dramatically influence your chance of making substantial profits. You can either buy your coins at a regular crypto exchange or from an OTC desk. The ideal platform to choose is the one that provides you the freedom to trade large amounts without worrying about the security of your assets.
One of the main reasons that made so many turn away from traditional exchanges is their limited liquidity. Why’s that important? Because investors cannot purchase large amounts of crypto without worrying about shifting the market; they face strict deposit and withdrawal limits!
Another major issue is that too many traditional exchanges have been exposed as scams, and they’re often the target of various cyber-attacks. That’s the last thing you want as an investor.
For these reasons, we believe utilizing an OTC desk for crypto investing is a more sensible and superior route compared to crypto exchanges.
What’s the Future of Crypto?
The crypto market has become dramatically prevalent in the last ten years, and the sky appears to be the limit for its growth. Countless people have made significant profits by investing in the crypto market, but you need to thoroughly understand it before risking your hard-earned cash.
As we move forward, new coins will arrive at the scene with enhanced technologies promising to eliminate the shortcomings of previous generations. Such steady improvement combined with strong endorsements is a telltale sign that the future is crypto.
Bottom Line
Finally, is crypto a good long term investment? It definitely can be.
However, before you start trading, you will need a trustworthy company to work with. Fortunately, you don’t have to look that far because that’s what Secure Digital Markets offers! Don’t hesitate to contact us right now! We’ll get you on board in no time and take care of everything.
