There are many of them: Bitcoin, Ethereum, Ripple are the three big currencies. Then there are several others like Iota, Dash, Stellar and Monero and thousands more. Digital currencies, decentralized, are supposed to offer anonymous transactions and build a financial system that exists alongside the traditional fiat currencies. The crypto currency is a fascinating asset with enormous potential thanks to disruptive technologies.
Many therefore consider investing in crypto currencies. This can even be done by people who are not normally familiar with the financial markets. Basically anyone with an Internet connection and some start-up capital can trade with a crypto currency. But it is not completely harmless. Where there are opportunities, risks lurk.
They are also interesting as a technology investment. The blockchain could change the way we deal with money and the Internet. Those who invest here invest their money in crypto-currency shares of a technology company. Ethereum, for example, boomed with its Smart Contracts and ICOs, an alternative method of crowdfunding.
Iota concentrates on the Internet of Things and industry 4.0. The worldwide acceptance of digital currencies is growing, with the Petro the first state coin was created.
When is it worth investing?
When to start investing depends on the mood in the market and the type of investment. Depending on which strategy you want to pursue, there will be other favorable entry opportunities. If you only want to buy a crypto currency and then keep it on your crypto currency wallet, then buy low, sell high.
But for this strategy you also need a lot of patience, because it can take months to years until the price has risen so much that the sale is worth it. There is also the possibility to mine crypto currency and then sell it.
The other investment strategy can basically always be pursued. Here it concerns the Forex-Trading, around the foreign exchange trade with the crypto currency similarly the foreign exchange trade with Fiatwährungen such as dollar and euro. The price will be invested by speculating on the fluctuations. And since the market always fluctuates, foreign exchange trading is always possible. However, one must be well versed with foreign exchange for this way of investing.
New possibilities will arise when the first crypto currency ETF is approved. Since 2018 there are already the first crypto currency funds. Here one can invest on a long-term basis.
Which crypto currencies in 2018 and 19?
The question of which coin or token to invest in is asked again and again, but is difficult to answer. The crypto currency market is unpredictable, subject to strong fluctuations and easily influenced by external factors.
In 2018, the price was not as high as in the previous year. That’s why it may already be worth buying some more now. At some point, the share prices went up again and again and that could also be the case in 2019. However, one should not ignore the Bitcoin alternatives such as Dash and Litecoin.
Ethereum and Ripple are fighting for second place. Ethereum is not just a crypto currency, but a whole ecosystem for decentralized applications and smart contracts. The token, ether, is used as fuel for this ecosystem. With Ethereum, entirely new business ideas can be implemented on the basis of the blockchain.
Or they can be made more efficient, faster and more trustworthy through smart contracts. Ethereum is not the only platform for Smart Contracts. NEO, Cardano and EOS are building similar platforms and are all promising projects.
So is IOTA. His token, MIOTA, is to become the fuel for the “Internet of Things”. IOTA is one of the most innovative blockchain projects from Germany. IOTA’s developers also work closely with industry and large companies. An early investment could pay off.
Coins such as Zcash and Monero are “privacy coins” and serve the growing demand for anonymous transactions. This demand will certainly not diminish in 2019.
Which are profitable in the long term?
It is impossible to say with certainty in which crypto currency one can invest and thus still make a profit in many years. The potential for more growth is there. But the market is still young, as are the technologies behind it. We are dealing here with the first generation and there is no guarantee that they will all still be there in five or ten years.
The crypto currency charts alone are not enough to decide which will be worthwhile as a long-term investment. A wise investor studies the crypto currency news, gets informed about the improvements and updates and what plans the developers have with their digital currency. Many of them are still in development, have not yet reached the final stage.
By looking at the track record of the developers or the company behind the blockchain, you can assess whether the project will be successful in many years to come. Also, you should ask yourself the question:
Does the coin or token serve a purpose? Is there a demand? Is it already being used or will it still be used in the future? Is the crypto currency constantly evolving to meet current requirements?
How much to invest?
Theoretically, it is possible to invest even the smallest amounts, which are in the two-digit range. The profits with such amounts should not be particularly high (unless the price of the crypto currency just explodes, which can happen). It is possible to trade with a crypto currency just by the way, without the intention to earn a living.
However, there are also traders who mainly trade in cryptos and thus finance their livelihood. This happens for example with day trading or foreign exchange trading. Several hundred Euros are invested every day. So it all depends on how you want to approach trading.
But everyone who is interested in crypto trading should be aware of the enormous risks. Digital currencies are very volatile and hardly regulated. There are no securities, there are many so-called “shitcoins” on the market that are not worth trading. An investment in a Shitcoin ends in a loss of money.
Because of these and many other risks, such as the threat of regulations and even bans, the amounts should always be in an area that does not ruin you. One should be able to cope with the possible loss. On the Internet there are many stories of people who have been gripped by hype and have invested their entire fortune. And then they stood there with empty hands.