Crypto Investing 101 : Know what you're buying!

in #crypto6 years ago

introduction

You may ask yourself. Why is a post like this important? Well, it is important because there is a ton of people that jumped into crypto head first without doing any kind of research as to where their money was going. I am not afraid of saying I was one such person not too long ago. I got older and wiser and have chosen to share my grains of wisdom with whoever might want to learn from it.

The currency

First off, it is important to realize that crypto is not just a “currency” crypto is a broad term for a lot of different things outside the currency coins. We, of course, have the cryptocurrency. These are coins whose sole purpose is to transfer wealth from point A to point B. The value of these coins depends on supply and demand. Here is a small example of such coins.

• Bitcoin.
• Litecoin.
• Vertcoin.
• Monero.

The Platforms and Networks

Then we have the Crypto Platform or Network coins/tokens. These are tokens or coins that allow develops to use the different networks with their projects. For example, Ethereum is a platform that runs smart contracts as they are programmed without any downtime.

“Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference.

While Ripple is a platform that wants to connect banks to crypto and its consumers.

“Ripple connects banks, payment providers, digital asset exchanges and corporates via RippleNet to provide one frictionless experience to send money globally.”

Here are some platform tokens/coins.

• Ethereum.
• Neo.
• Ripple.
• Stellar.

The Equity or Company Tokens/Coins.

Then we have the Equity coins/tokens or ‘company’ tokens/coins. I call these company coins because a lot of these coins only have use cases with some websites or services. These coins/tokens are by no means bad or should be ignored as often these can be a huge profit if the website they are linked to take off. KUCoin Shares (KCS) is in this category, KCS went from 0,5$ to 20$ at an all-time high and are currently sitting on 2$. Often these coins offer a benefit from owning them, KCS offers a revenue share model, this means that for every 1$ KuCoin makes a % will be split out to token holders. More websites/companies are starting to adopt this model.
Some example of utility coins/tokens are.
• KCS.
• COSS.
• PFR.
• NEON.
• STEEM/SBD.

Why?

Why is it important to know what type of coin/token you are buying you may ask? The answer is simple, if you know what you are investing in you have a bigger chance of knowing when your investment will go up or down. For example, if you have invested in a platform token and the platform you have invested in have an upgrade announced then you could reasonably expect that token to go up in value.
If a company coin/token you have invested in and that company now have a partner of value for their company or offer a new service with their coins/tokens, then you could expect it to go up in value. By knowing your investments, you can more easily predict the market.
And if a currency coins have been accepted as a payment to a well-known site or had some updates that further improves the coin it will almost always go up in price.

Benefits!

By knowing what you own you can be safer when playing the market, as well as deciding on when to buy more or exit. I have often heard people say ‘I will buy X because the graph is low’ graphs don’t really mean anything when it comes to crypto, what means the most is the publicity and use cases for what you have invested in! by having the knowledge of what you actually own it makes it so much easier to make money in this space. not everything will moon but if you choose your investments well there is a lot of money to be made no matter what.

Thank you all for reading this far, this is my first real in-depth post of many to come. I have decided to turn my life around and post at least 1 steemit post daily! (i will have another post out with more information later today)

please leave a comment with feedback if you have any it can be good or bad I am trying to improve :)

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First of all, it is always important to know what you are Buying. Cryptocurrency is yet not open to the Majority of the Public so getting a 101 version of Investing will always be helpful to somebody in the World.

Imagine my Dad just woke up Tomorrow and wanting to Buy some Crypto what should I do?

I will Google for a Quick Guide on Cryptocurrencies for my Dad and my Dad can read the Article and decide which Coin he will Buy. AS me explaining my Dad would be disastrous.

To be honest the Topic you have Pointed out is so Vast that I feel that there are many Bits that are Missing as the Platform and Equity Tokens have a lot of In-depth​ systems which I would have loved to see.

PS: Man your Posts are Hard to Reply to I have to think on and on about what to Write.

my plan is to look closer at the different types (equity/company tokens are one of them) i just wanted to get a overwiev out so people have some idea of what i mean with my upcomming posts.

thank you so much for your comment :)

I am currently Racking up Equity Tokens twice a Week.

I have started with Kucoin Shares and I am thinking about moving to Binance soon.

Awesome post @darkdrake
I agree, I can not stress that enough. Most people are just buying coins off hype. It's the coins with technology being utilized today or the ones that are going to solve big problems, that'll still be here in the next 5-10 years. Always do your research before buying, keep up the good work :)

absolutely @kidmartin-95

I hope to be able to educate people on why they should do their research before buying into a project as well as show people why I choose the coins/tokens I have invested in :)

thank you so much for your comment!

Thank you very much for giving us a great post, thank you very much and congratulations. The words that you wrote about cryptocurrency and investing are really very good thanks to you again thank you very much for your post, we will be benefited from the new ones because you The words that are spoken are very effective

thank you for your comment :)

Welcome dear it's my pleasure

This post has received a 2.16 % upvote from @speedvoter thanks to: @darkdrake.

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