Top 5 Crypto Investing Mistakes

Did you do any of these top 5 crypto investing mistakes? Some of us are guilty of not educating ourselves about this rapidly developing market, which can cost you a fortune.

5 September, AtoZ MarketsThe boom of the cryptocurrency market has taken over all of the news’ headlines back in 2017. Starting from the moment the leading cryptocurrency Bitcoin reached $20,000 levels, many investors have jumped into the market.

Top 5 Common Crypto Investing Mistakes

Even now, you will barely meet anyone who never heard of cryptocurrencies. Most of your friends, colleagues, and relatives have considered investing in cryptocurrency. Some people choose to do so without having a general idea about this technology. In the end, it’s mostly the speculation that has sent some of the major cryptocurrencies soaring. 
While investing in cryptocurrencies might be one of the smartest things to do these days. One should possess some knowledge about how to handle this process. In fact, many of the novice investors fail to educate themselves on how to invest in cryptocurrencies. This is one of the biggest mistakes a crypto investor can make.
Below, let’s discuss the top 5 common crypto investing mistakes.

The Fear Of Missing Out (FOMO)

FOMO is one of the worst reasons to join a cryptocurrency army. As it is a destructive and usually disappointing motive to do so. FOMO strategy is also quite unrealistic if we talk about the long-term goal. 
When you invest in a particular cryptocurrency, you should do so based on a thorough analysis. And not because your friend has invested in it. There is no guarantee that a particular cryptocurrency will soar in 12 months or in a longer period. Therefore, investing in the cryptocurrency market because everyone does it is not the best idea. 

Lack Of Security

Security in the crypto world is one of the most important factors to think about if you plan to become a cryptocurrency investor. When you invest in a cryptocurrency, your task is to protect it from cybercriminals. Therefore, you need to make sure you properly use your private key and cryptocurrency wallet. 
It is also vital to choose a reliable and secure cryptocurrency exchange, as any weakness in the system might cost you your entire balance. There is a number of methods you can use in order to improve the security of your crypto investment portfolio:
  • Choose your exchange carefully
  • Invest in a cold storage 
  • Store your private key In multiple locations
  • Use encryption

Do not panic!

This, by all means, is one of the most common crypto investing mistakes. This is also the reason why newbie investors do not have any profits from their investments. 
Every single day the cryptocurrency market reacts to a chain of news. Some of them are extremely negative, some are neutral, and some are quite positive. However, some people tend to go into a panic mode when they read a news article about the “Bitcoin Bubble.” Then they immediately decide to sell all of their BTC. 
It is very important to understand that the cryptocurrency market is extremely volatile, and sometimes if some negative news is appearing, it can slide. Also, it might be a simple market correction. So there is no need to hit the “sell” button once you feel a negative sentiment in the market. 

Biting more than you can chew

Many novice cryptocurrency investors often go all-in with expectations of gaining huge profits overnight. However, this approach usually leads to a zero in the account and numerous debts in a bank account.
Instead, if you are weighing in becoming a cryptocurrency investor, allocate only the “free” funds to this purpose. This means that you should only invest the sum you can afford to lose. 

No strategy in place

Every single time you invest some money in a particular cryptocurrency, you need to ensure that this move is aligned with your strategy. The cryptocurrency investing strategy can be based on fundamental and technical analysis of the digital currencies you are looking into.
If your strategy comprises the assumption that investing in a certain cryptocurrency is a good idea, this might not be the smartest plan. You may get lucky a couple of times, but for the long term, you need a rock-solid cryptocurrency investment strategy.
Think we missed something? Let us know in the comments section below. 

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