How to Invest in the Cryptocurrencies for Beginners

With the increased coverage of Bitcoin and other cryptocurrencies by mainstream media, the cryptocurrency market is gradually entering the public view. However, some new beginners are still confused about "how to invest in cryptocurrencies" and have no idea how to start with.

So today, we're going to walk you through a detailed introduction: how to invest in cryptocurrencies?

1. Stay Cautious, Invest Safely

This is a common risk warning universally found in the stock markets, as well as in the crypto market. If you plan to invest in cryptocurrencies, you should first figure out the high-risk and high-reward investment attributes of cryptocurrencies. Crypto beginners who plunge into the investment without prior knowledge might easily suffer a financial loss. Therefore, it's important to acquire basic knowledge before investing.

2. The Differences Between Stock and Cryptocurrency

Many people may have already been familiar with stock investment when entering the crypto market, so what're the differences between them?

3. Select a Cryptocurrency Exchange

Beginners often start their cryptocurrency journey on the exchanges. There are two main types of exchanges. The first and most popular type of exchange is the centralized exchange, called CEX, and the second type is the decentralized exchange, called DEX.If you don't have any cryptocurrencies yet, you will need to select an exchange that supports the deposit of fiat currency.BingX currently supports deposits via credit card. For details, please click [Buy/Sell - Buy Crypto with credit card] or click https://bingx.com/en-us/buy/ to buy cryptocurrencies.

4. Get Started by Purchasing Bitcoin in the Spot Market

There are many crypto financial derivatives that have been developed on cryptocurrency exchanges today, but the first step for a beginner is to start with buying Bitcoin in the spot market. If you have a limited budget, you don't have to buy a whole Bitcoin, instead, you can invest in small amounts of Bitcoin at $100. BingX also provides many beginner-friendly services (such as Bonus), which can be found in the [Help Center - Beginner 101].

5. Learn About Cryptocurrency Security

Take Bitcoin as an example, there is "public key", "address" and "private key".If the "public key" is the bank account, the "address" is like the card number of the bank account, and the "private key" is your personal password. In other words, there is not much difference between cryptocurrencies and traditional bank accounts. As long as you keep your "private key" safe and prevent it from being stolen, you can safely guard your cryptocurrency.

6. Learn About Common Cryptocurrencies

After completing your first bitcoin spot trade, you probably understand the process of investing in cryptocurrencies generally.Then, you can start learning more about the common coins and trending sectors in the cryptocurrency market.The No. 1 cryptocurrency by market cap is currently Bitcoin, while the second-largest is Ether.Bitcoin and Ether are more recognized in the market with their larger size and smaller price fluctuations (limited to the cryptocurrency market), so beginners should learn about Bitcoin and Ether first.More common cryptocurrencies and trending sectors will be introduced in BingX Academy.

7. A Beginner's Guide to Investing in Cryptocurrencies

All investment involves risks. However, the right investment strategies will generate good returns with minimal risks.

(1) Beginners should give priority to Bitcoin and Ether

For beginners investing in cryptocurrencies, Bitcoin and Ether should be given priority. The reason is that they have a larger market cap, more stable prices (cryptocurrency market only), and higher market recognition and usage.

(2) Instill the concept of value investment

Instead of holding cryptocurrencies in the short run, you should adopt a long-term perspective in investment.Short-term cryptocurrency holders are often subject to unnecessary losses. For example, if the price increases in a short time when you are involved, it happens to gain profits by selling on the market, thus bringing the price back down, and you may suffer losses and get knocked out.However, when you sell, the market buys in again, resulting in an increased price.As long as you have a long-term perspective of holding cryptocurrencies, you won't suffer from unnecessary losses by panic selling for temporary declines.

(3) Set up an automatic investment plan

The three basic elements of the automatic investment plan: find a relatively low point to start with and increase your assets over time. Be consistent, stay calm, and your wealth will grow with time.For example, you can invest $1,000 per month or divide the funds for the cryptocurrency market into three to five parts and buy them in batches. Since the prices of cryptocurrencies are volatile, an automatic investment plan can avoid buying at the highest point of short-term fluctuation, thus allowing you to buy at a relatively reasonable average price.

(4) Control your available funds

First, the invested funds shouldn't be your emergency funds or money that you will need to use within two years, so as to avoid being forced to sell your cryptocurrency at a low price to cash out. Second, the investment should only account for 5-10% of your total funds or another reasonable proportion, so you are not under too much pressure even there's huge volatility.