It’s said that 83% of millennial millionaires own crypto. If you’re looking to invest in cryptocurrency, you’re following in the financial footsteps of the highest earners in America.
But while blockchain technology and digital currency are all interesting ideas, it still begs the question:
What are the benefits of investing in cryptocurrency? After all, nobody wants to be scammed out of their life savings.
At this stage, cryptocurrency is here to stay. It’s not a pie-in-the-sky internet fantasy or a fad. These digital coins are catapulting regular people into higher tax brackets.
If you want to learn more about investing in crypto, you’ve come to the right place. We’ll describe the coins before explaining the benefits of crypto investing. After that, we’ll give you our list of essential cryptocurrency tips.
Keep reading to learn more about how cryptocurrency has captured the imaginations of investors.
Understanding the Different Types of Cryptocurrency
According to CoinMarketCap, the cryptocurrency market is currently valued at $1 trillion. In the same way that the stock market has multiple companies, indexes, and investment instruments, the crypto market can also be broken down into categories. Here’s a list of the main three types of crypto you’ll find:
1. Bitcoin
When Bitcoin made its debut in 2009, it was easy to write it off as an internet-driven trend. But today, Bitcoin is officially mainstream. If you want to invest in the crypto market, we can’t emphasize this enough.
In sports, you have regular players and star players. Even within that upper echelon of highly skilled players, there are people like Michael Jordan or Wayne Brady who aren’t just run-of-the-mill stars — they’re so gifted that they’re known to people who don’t even follow their sports.
Bitcoin is the cryptocurrency market’s franchise player. Whether you’re planning to purchase one cryptocurrency or several, crypto investors need to be familiar with what Bitcoin is and how it works.
2. Altcoins
In the traditional investing world, people are always told not to put all their eggs in one basket. This way, even if one company they’ve invested in goes out of business, their diversified portfolio will still have a chance of being profitable.
On paper, altcoins are what the name says on the tin — they’re alternatives to Bitcoin. But that doesn’t fully do the concept justice.
Ethereum, for instance, is one of the bigger altcoins available on the market. People use Ethereum’s smart contracts to create and run apps. Meanwhile, there are altcoins like Cardano that allow users to transfer funds quickly and cheaply.
Here’s the bottom line:
Altcoins might not dominate the crypto market like Bitcoin. But different coins bring different strengths to the market. This gives crypto investors more options to choose from.
3. Memecoins
We’ve talked about Bitcoin and Altcoins and the big-time missions associated with them. For all the talk of revolutionizing finance that goes on in these two crypto categories, there’s a third class of coins that don’t do anything of the sort:
Memecoins.
Dogecoin, perhaps one of the most famous meme coin examples yet, went up by 7.9% after Elon Musk reiterated his support for it. Meme coins may be built out of memes and inside jokes, but the money you can make from purchasing these coins is not a laughing matter.
What Are the Benefits of Investing in Crypto?
We’ve covered the basics of cryptocurrency. And we’ve highlighted some of the strengths of the various coin categories. But that doesn’t address the “why” of crypto investing.
In our experience, there are four strong reasons to consider purchasing crypto:
1. There’s Explosive Growth
A $100 Bitcoin investment in 2009 would have been worth over $48 million in February 2021. If you’re like most people, that’s a life-changing sum of money.
In the stock market, money compounds over time. You can become a millionaire, but it often takes decades to get there. And even then, $100 likely won’t become a million dollars on its own.
With crypto, you can get outsized results with less. One of the biggest reasons why crypto has taken over the internet in recent years is because of cryptocurrency’s shocking ability to double and triple in value.
2. Invest What You Have
It often seems like the best companies are also the most expensive to invest in.
At the time of this writing, Microsoft shares are over $250 while Tesla shares are going for more than $700. Amazon and Meta are going for over $100 each. And if you want to buy indexes, ETFs can also set you back a pretty penny.
According to Business Insider, 25% of Americans have no emergency savings to speak of. If you’re one of the many who live paycheck to paycheck, putting aside even $150 a month can feel like a Herculean effort. Never mind the $700 needed to buy Tesla shares.
The sad reality of investing is that you often need to have money before you can make more of it. But that’s not the case with crypto.
Even if you have only $5 or $10 to put aside, you can purchase fractions of the coins. This allows you to enjoy the benefits of rapid and explosive growth while investing whatever you can spare.
3. You Can Get in Early
Remember the Dot Com bubble? Or perhaps, more recently, the hype around tech companies in general?
The reason why investors flock to tech shares like bees to honey can be summed up in one word:
Facebook.
Lots of people were unsure. Others were skeptical about the business value of an online company. But the people who got in early didn’t just make a small profit — they were funding their retirements early.
Many people didn’t have a chance to get in on those blue-chip stocks. And many folks are still kicking themselves over Bitcoin.
But the beauty of the crypto market is that you don’t have to wait for stocks to split while hoping to find the next Amazon. You can read white papers, find new coins, and ride the wave to success at any time.
4. You Have Control Over Your Coins
Everyone talks about the importance of getting a job with benefits and a 401k. But as much as everyone wants to retire comfortably, there’s a major downside to workplace investments that nobody ever talks about:
Investment decisions are often made on your behalf by bankers and fund managers.
With crypto, you can be more enterprising.
You own the coins. You call the shots. And you’re even in charge of securing your coins.
If you’re the type of person who’s always coming up with new investment ideas and concepts, cryptocurrency makes it possible for you to put your ideas to the test.
Our Top Cryptocurrency Tips
Although the cryptocurrency market is known for its ability to make people rich, the speed of crypto coins can give new investors a bad case of financial whiplash. To combat this, there’s a lot of good advice out there advising you to:
- Follow a consistent set of trading rules
- Be ready for the market’s highs and lows
- Do your due diligence on the coins you choose
However, along with these top-notch tips, there are two additional tips that you need to follow at all costs.
First, you need a sustainable investing strategy.
Many people set fitness goals every year. However, because the leap from “barely lifts a pencil” to “triathlon-ready athlete” is often too much, many of those folks fail to lose weight and become healthier.
If you’re a busy person who barely has time for breakfast, an investment strategy that has you glued to the screen may not be viable. Whether you’re choosing to buy and hold or to day trade, however, the key is to create a consistent strategy that you can stick to.
Secondly, you’ll want to know exactly how to withdraw and deposit your funds. Many people will work with exchanges or do in-person sales, but the safety issues and concerns about data breaches can be hard to overlook. If you can search for a Bitcoin ATM in your area, however, you can buy and sell cryptocurrency with ease.
Grow Your Portfolio With Cryptocurrency
Cryptocurrency millionaires. Global access to funds. Blockchain technology applications.
Even if you’re not the most tech-savvy person on the planet, it’s not exaggerating to say that cryptocurrency has been changing lives. And between the growth potential and the fractional investing, the benefits of investing in cryptocurrency are undeniable.
Are you looking for more articles like this? We’ve got you covered. Check out our site to see more red-hot crypto content.
