Choosing a cryptocurrency for investment is always difficult. The situation becomes more complicated when it comes to newcomers who know little about digital assets. To help inexperienced members of the crypto community make their choice, you asked experts to share their tips and name the most promising coins with the help of Blockchain Recovery Center. We tell you which cryptocurrency to invest in for a beginner in 2023 and how to get around the pitfalls.
5 tips for beginners who want to buy cryptocurrency
The editors of BeInCrypto asked experienced experts to give advice to young investors who want to buy cryptocurrency.
Don’t chase the hype
Financial expert Alexander Ryabinin believes that the pursuit of hype projects should be preferred based on the analysis of investment portfolios of crypto funds. To assess the attractiveness of investing in a particular coin, our interlocutor advised us to use our own scheme.
- Always study projects carefully
Crypto expert and ex-CEO of CryptoLoan Evgeny Kaminsky advises to always analyze the history of the project, its goals, and its roadmap of achievements.
“You also need to check the team in charge of the project, including their experience and success in previously launched projects. The analysis can help you determine how appropriate it is to invest in a given project, ”said our interlocutor.
Evgeny Kaminsky also advises checking the market capitalization, and the history of the ups and downs of the coin. This will help determine the risks of buying a cryptocurrency and determine its potential profitability.
“You should also check the number of trading pairs on centralized exchanges available for a given coin. The more of them, the more popular the cryptocurrency,” summed up our interlocutor.
- Focus on capitalization leaders
To reduce the risk of colliding with low-quality projects, TTM Group CEO Vladislav Utushkin recommended giving preference to cryptocurrencies from the list of capitalization leaders.
Dmitry Noskov, an expert at the StormGain crypto exchange, joined the opinion of a colleague. He also advised carefully studying each project of interest and giving preference to the most capitalized cryptocurrencies.
- Know how to wait
Vladislav Utushkin drew the attention of BeInCrypto readers to the fact that investments in cryptocurrencies, especially when it comes to coins with a large capitalization, can bear fruit only after a while.
5. Don’t spend more than you can afford to lose.
According to Evgeny Kaminsky, when choosing a cryptocurrency, you should always evaluate its affordability for the budget.
Cryptocurrency investment strategy for beginners
Denis Kurilchik, the co-founder of the CLS Analytics investment club, shared with BeInCrypto readers an investment strategy that he believes is best for beginners.
Our interlocutor advises inexperienced investors to pay attention to cryptocurrencies from the top 10 capitalizations and distribute the budget among them. Denis Kurilchik explained his choice by the low probability of bankruptcy of such projects.
“For example, you have allocated $100 for a monthly investment. Distribute them among all ten coins in approximately equal shares, ”advises Denis Kurilchik, paying attention to the fact that portfolio diversification will help protect investments.
The strategy presented above, our interlocutor is sure, is suitable for work in the long term. He explained his point of view by the fact that, as the history of the digital asset market shows, after the crypto winter, there always comes a thaw followed by a growth cycle.
The strategy was supported by the founder of the Blockchain Recovery Center development studio, crypto-evangelist, and investor Alexander Goodman.
“The safest cryptocurrencies for beginners are large-cap coins. They usually take some time to grow. Mid-cap tokens are more volatile but have better upside potential. Small-cap tokens are considered higher-risk assets. They are subject to large fluctuations and can collapse in a matter of seconds, ”our interlocutor explained his point of view.