5 Facts Every Newbie Should Know About Cryptocurrency 2022
With so much media attention being given to digital currencies like Bitcoin and Ethereum, it’s safe to say that interest in blockchain technologies has skyrocketed over the past few years. According to Statista, the market capitalization of all cryptocurrency tokens grew over 3000% in the past decade to an all-time high of $3,048 billion in 2021. As a result, more people are now investing in and learning about cryptographically secure tokens than ever before.
Fortunately, anyone can learn about and invest in cryptocurrency to position themselves for financial freedom. It doesn’t matter what your age is, how much money you have, or what your background or education is. However, with so many different concepts and ideas floating around at once, it can be challenging for newcomers to differentiate between myths and facts.
To help you, we have put together this guide on 5 facts you need to know about cryptocurrency in 2022.
1. Crypto Markets Are Always Open 24/7
- 1 1. Crypto Markets Are Always Open 24/7
- 2 2. There Are Many Different Types Of Cryptocurrency
- 3 3. Crypto Is More Transparent And Secure Than Traditional Banks
- 4 4. Crypto is High-Risk Investment With Potentially High Rewards
- 5 5. Initial Coin Offerings Are A Great Way to Earn High-Potential Profits
- 6 Conclusion
Finally, crypto markets are always open 24/7. Crypto markets never close, so investors can make money whenever they want. You only need a reputable and reliable crypto exchanges platform and market knowledge to make money.
In the traditional financial sector, most markets and exchanges are closed on weekends and during certain holidays. This can be a huge problem for investors who want to make or close cryptocurrency trades at certain times. For example, if you want to close a profitable trade on a Friday, you may be unable to do so because the exchange won’t be open again until Monday. With cryptocurrency, there’s no set schedule for trading, so you can do it whenever you want.
But unlimited access to the market also means that you need to be extra careful not to overtrade. Take time to research and analyze the market to make better trade decisions.
2. There Are Many Different Types Of Cryptocurrency
The first thing you should know is that there are thousands of cryptocurrencies. Crypto is classified into Coins and tokens, and most people confuse and use these two interchangeably.
Crypto coins are digital currencies backed by blockchain technology, providing an alternative payment method. This category consists of Bitcoin and altcoins. Altcoins are all other cryptos that are not bitcoin and include Dogecoin, Ethereum, Cardano, Binance Coin, and more. Crypto coins can be mined, act as digital money, and run on their blockchain.
Tokens, on the other hand, are digital units of values representing tradable assets or utility. They differ from coins because they don’t have their blockchain and are only issued within an existing blockchain. Additionally, they can’t be mined but minted. Although you can’t use them as a medium of exchange, you can buy, sell or trade them just like coins.
3. Crypto Is More Transparent And Secure Than Traditional Banks
Unlike banks, cryptos are decentralized and faster with fewer protocols. Cryptocurrency eliminates hassles by enabling direct peer-to-peer transactions that are transparent and secured using blockchain technology. It uses a public ledger to store transaction crypto while eliminating secrecy.
4. Crypto is High-Risk Investment With Potentially High Rewards
One of the biggest myths about cryptocurrency is that it’s a safe and secure investment with a low-risk factor. In reality, cryptocurrency investments are incredibly high risk, and you should only invest money you’re willing to lose.
However, because cryptocurrencies are still a relatively new asset class, there’s a massive potential for growth and profit. Successfully predicting the right coins to invest in can result in astronomical gains. On the other hand, buying the wrong tokens can lead to devastating losses.
5. Initial Coin Offerings Are A Great Way to Earn High-Potential Profits
You can earn high potential profits in the crypto sector through initial coin offerings. An ICO is a special crowdfunding campaign that enables blockchain startups to raise money by issuing special tokens. These tokens are essentially shares in the company and entitle their holders to a portion of the profits. If the startup succeeds, ICO investors can make a ton of money.
On the other hand, if the company fails, the tokens will likely become worthless. There are many notable ICOs that have been very profitable for investors. For instance, NEO, nicknamed China’s Ethereum, rose from the initial token of $0.03 to reach $180! If you can pick the right ICOs to invest in, you could easily make tens or even hundreds of thousands of dollars. However, ICOs are incredibly risky, and you should only invest with the help of experienced investors.
Cryptocurrency is a highly lucrative field with high-profit potential, but it comes with a high level of risk. Before you jump in, it’s essential to understand the facts and myths about cryptocurrency. Most of the facts you should know are in this guide, but it doesn’t hurt to learn more about crypto and how it works.
You also need to understand how high-risk investments work and how to choose the right cryptos to invest in and how the crypto markets operate. If you do your due diligence, you might be on your way to making money with crypto.