Some Essential Tips to Follow Before Crypto Trading in 2022
The volatility of Crypto in 2021 In 2021, investors from all over were cashing in on cryptocurrency investments with huge profits. Some coins saw an increase of 5000-7000 percent, giving unexpected returns. Cryptocurrencies are not a straight line. Even blue-chip Crypto like Bitcoin and Ethereum rose 35-40% in 2021, but the trajectory was not always smooth; prices zoomed to touch 54 lakhs by April before falling sharply when Elon Musk tweets about his concerns on environmental impact and China cracking down on crypto trading, then recovering with another 30%-plus increase within hours! Buyers came back again in September and experienced some incredible gains since November. What to expect from crypto market in terms of volatility in 2022 Cryptocurrencies are gaining ground in the country's financial market. Yet, its future will depend majorly on government policies. The world's largest crypto market, China, banned all transactions earlier this year. Now India is working on legislation regulating the use and trading of cryptocurrencies within its borders. They want to prohibit private coins at first but with some exceptions for promoting blockchain technology under its benefits. Basic rules that investors may follow before trading in Crypto: Cryptocurrencies are a high-risk investment that has little data for fundamental analysis. However, there are some basic rules you can keep in mind when entering this new and exciting marketplace! Invest in small amounts: The recent rise in value for cryptocurrencies has been nothing short of extraordinary. But don't let the popping numbers phase you; as with any investment, only invest what is available to trade and no more than 10-15% into crypto coins at once.
Learn to eat and digest extreme volatility: It's a high risk/reward game with highs and lows that can be extreme; it's a high risk/reward game. Investors must digest volatility because even blue-chip stocks such as Bitcoin have fallen 25% from its November (2021) price of Rs 54 lakhs. With this market entering the realm only for those ready with their pocketbooks- enter at your peril! Use a platform that is trustworthy enough: You should invest through an established platform so that your money doesn't get stuck if there's a regulatory setback or the promoter company goes under, especially since it might be difficult for you to withdraw funds from these overseas platforms without facing taxes. Don't act on unverified information: The crypto space is plagued with fake news and misinformation. In a world where information can be found anywhere on social media, investors must do their research before entering the market blindly or paying exorbitant fees just as an "insider tip." Consider blue chips: Crypto has thousands of coins with different values and trends. It's easy to get excited when you see a great opportunity, but don't overlook the more significant bluechip coins such as Bitcoin or Ethereum if they suit your needs better because their stability will ensure that this market goes up rather than down over time.