How to Invest in Cryptocurrency in 2019
Cryptocurrency investment is still every bit as interesting as it was five years ago. However, there are now more factors affecting the performance of the market. One of such factors is that development has pushed so many new projects into the area, leading to palpable excitement. Unfortunately, as more projects have come to fruition, so have scams and malicious actors.
It is also more difficult to predict the future of digital currencies since a lot of them have morphed from stores of value, into platforms for hosting applications, file sharing, and even remittance.
Digital currencies also showed that they could be a lot more profitable than traditional investment vehicles, with highs of up to 15,000%. Now, a new year has come, and although nobody fully knows what the unpredictable world of cryptocurrency holds, investors must shield themselves against loss, by only investing in the top currencies that they trust.
What are the Best Cryptocurrencies to Invest in 2019?
Although there are many cryptocurrencies to choose from, these are our top picks!
Looking at Bitcoin, there are still a ton of solid reasons why investors, both new and seasoned should invest in it. It is no secret that the pioneer cryptocurrency has had its fair share of bad days in the markets. However, it still sits at the top rank, with the highest market price, market capitalization, and stability.
It is also the oldest digital currency and as a result, the most established. This means that several big-time investors and field experts have stakes in Bitcoin. Although there has been speculation concerning the sustainability and scalability of the platform, it is fully functional for the time being.
Before becoming a Bitcoin investor, it is essential to know exactly how to invest in cryptocurrency. It is a lot harder than it looks and takes a great deal of time and research. Just as there can be immense rewards from toying with BTC, there can also be a loss. Usually, in fundamental analysis, Bitcoin highs and lows follow recent events within the space.
So, if there is a new positive development, it may be a good time to buy some BTC. A huge dip in the BTC price may also be an excellent opportunity to buy low and sell high later. When it comes to cryptocurrencies, one thing is constant: prices will always rise and fall. The primary factor is time.
No investment portfolio or tutorial on how to invest in cryptocurrency is complete without Ripple. XRP has continued to gain momentum in the crypto world, even ousting Ethereum from its place as the second-largest cryptocurrency by market capitalization.
Since its emergence, Ripple has been at the forefront of cross-border remittance, making the process faster, cheaper and more efficient. The platform has also taken a smart approach towards its operations by focusing on banks and other financial institutions. This has solidified its presence within the niche market and given it credibility, a feature that most digital currencies do not currently have.
Ripple is extremely popular, and this popularity stems from the fact that it is both a platform and a digital currency. XRP has also shown immense profitability, with a growth rate of more than 35,000% in just 2017. In addition to this, the platform has been amassing a long list of partnerships for a while now. From large banks like JP Morgan to remittance services like MoneyGram, Ripple is not slowing down.
Investing in Ripple is a long-term investment in the same form as a firm that seems to know what it is doing. However, just like Bitcoin investment, investors must be aware of current Ripple trends before putting their money into it. These trends will act as guides.
Although Ethereum has not had the best performance in the past year, it is undoubtedly at the top of the list of cryptocurrencies to invest in. Unlike Bitcoin, Ethereum is a hosting platform for decentralized applications. On the surface, this includes fun crypto games and playful projects, but going deeper, Ethereum has shown that it can house applications that solve pressing problems such as issues with content sharing, logistics, and even healthcare.
Ethereum also showed that it can be highly profitable when it increased by 3000%, becoming the second-largest digital currency at the time, a position now occupied by Ripple.
In the world of blockchain technology and cryptocurrency, one of the most discussed topics is that of long-term sustenance. The Ethereum platform is built for such functionality that will still prove relevant in a few years. In the future, many new projects will still require a launchpad for their businesses and companies.
Although other platforms, such as EOS, offer the same functions, Ethereum was the first one around and seems to be the only one pushing for real decentralization. In a few years, what will seem more valuable? A platform built on centralization, or one that has stuck to the original decentralized model that cryptocurrency was created to follow?
Litecoin was initially intended to shadow Bitcoin, as a more reliable ‘Lite’ version. It has succeeded in this aspect despite controversy and has remained among the top ten cryptocurrencies, with a market capitalization of approximately $1.8 billion.
Interest in Litecoin will most likely be present as long as Bitcoin exists since a lot of features on the LTC blockchain are improvements on existing Bitcoin features. For example, Litecoin transactions (2.5 minutes) are four times faster than those of Bitcoin (10 minutes) faster than Bitcoin. LTC also has a cap of 84 million, which means that there will never be more than that amount of LTC in existence. Bitcoin, on the other hand, is capped at 21 million.
Litecoin rose by more than 8000% in 2017, showing that it can be just as profitable as any of the other top digital currencies in a bull market. Investing in LTC is also affordable since its price point of $30 per unit is cheaper than other currencies such as Bitcoin Cash. Litecoin has hit a couple of significant milestones that show hope for its long term performance. For example, it was the first digital currency to carry out a Lightning Network network transaction when 0.00000001 LTC was transferred from Zurich to San Francisco in less than a second.
What are Investment Strategies?
It is not enough to learn about how to invest in cryptocurrency, and then jump right into it without a plan. The best investors have everything carefully mapped out, but before doing this, they pick a strategy. The two main approaches used are a long-term investment and a short-term investment.
Long-term Cryptocurrency Investment
Long-term cryptocurrency investment involves buying and holding specific cryptocurrencies for a long wait period until they become profitable. This is a better option for investors who do not want to bother about charts or daily developments of their favorite digital currency.
Also, some coins take a long time to start performing well. A good example is that of the Winklevoss twins who bought Bitcoin in its early stages and became billionaires in 2017 when the pioneer cryptocurrency skyrocketed to more than $19,000. Depending on the cryptocurrency that investors choose, long-term investment strategy can be extremely profitable.
Short-term Cryptocurrency Investment
Investors make short-term investments within short durations, such as every few months. While the constant change in market trends makes this a profitable venture, it is a lot more stressful and time-consuming than a long-term investment strategy. It involves monitoring the charts consistently in search of market movements that signify incoming gains or losses.
A short-term investor must also be aware of the fundamental developments of the particular cryptocurrency in question, and if they are more than one, this can become overwhelming. Ideally, short-term investment is for those who are not very busy with their jobs and other aspects of life due to the time and attention-to-detail it requires.
There were many lessons learned from cryptocurrency investment in 2018. For inexperienced investors, there was a belief, backed by many predictions, that digital currencies would repeat the larger-than-life performances of the previous year. However, such investors were in for a rude awakening. Investment is a delicate subject due to the risk of loss. This is why it is essential to know how to invest in 2019 so that the loss of 2018 does not repeat itself.