Disclaimer: Do not take this information as professional investment advice.

Crypto and blockchain technology has the potential to create new and revolutionary business models that cut red tape and dramatically increase efficiency. In the past, investors in cryptocurrencies have been ridiculously successful. As long as inflation isn’t too high; money gains more and more value the more capital is injected into it.

At this point all are asking: which are the trends, what the hottest investment product? How can you estimate what the next big thing will be? No one knows this, but you can do your own research and invest based on your own risk tolerance.

As a newcomer it is probably not productive holding many coins and currencies you don't know much about as when they drop in value you will be most likely to sell them instead of holding for the long term. Essentially, when you hold only one or two things you really believe in (gold, stock of company you are really behind, a high cap cryptocurrency like Bitcoin, Ethereum, Litecoin or Dash), you don't have to know about all the other things and you can focus more on the long term growth. Also as one currency rises, the value (purchasing power) of another currency falls when competing on an open market. However the opposite is also true as one major stock or major cryptocurrency such as Bitcoin or Ethereum, many others will rise with it.

Satoshi per US Dollar Chart: https://twitter.com/ChartsBtc/status/1060677924754321408

The digital asset trading environment is burdened with extreme risk, and many projects unfortunately go sour. Such cases often leave the investors and traders of these coins suddenly with nothing of value.

Bitcoin has opened up a new market for people to print proprietary currencies and has allowed all currencies to compete internationally at the individual level. We see this through the creation of many exchanges and thousands of cryptocurrencies. Any retail investor can now trade currencies.

In the past mostly Bitcoin was traded as it existed on its own 10 years ago. Nowadays in every well-balanced crypto-portfolio today you find other so called "Altcoins" like Ethereum, Litecoin, Bitcoin Cash, Dash and more. A good starting point to put together your portfolio should be the website coinmarketcap. Never invest more than you are willing to lose, if you need the invested money back in a short amount of time, you are more likely to sell too early and sell for a loss. Until you have properly researched every aspect on the projects you like to invest in, it is recommended to only put a small amount of play money into it, which doesn't lead you to lose sleep over the day-to-day swings. This play money also lets you use a cryptocurrency for small buys, sending some to friends and even if you make a mistake and lose some of it, it won't hurt you much.

Conclusion and Outlook

3 Reasons why you should not to panic sell:

  • Take a deep breath and reconnect with your long-term financial goals. Give your brain experiences that show it that you don’t have to give into panic.
    Warren Buffett is right: Buffett is famous for saying It’s wise to be “fearful when others are greedy and greedy when others are fearful.”
  • If you haven’t lost a penny until you sell: It’s important to remember this when you see scary headlines or hear fearful ‘water cooler’ chatter about plummeting markets.  Ride out the storm, and give your cryptocurrencies investments time and space to do what they do best: Grow.
  • Invest with diversity so if one of your assets crashes, others might still be stable. Use different markets and approaches, also don't make financial decisions based on fear: The reptilian part of our brains programmed to respond to fear in the ‘hear and now’ at the expense of logic. Each bear market should extend out longer than the previous due to each bull market lasting longer and going higher than the previous. The more you believe in the long term sustainability in a project and overall in the prosperity of the human race, the better you will do as a long term investor.

Feel free to check out the Price Bets on Fairlay if you like to speculate on future price developments in the cryptocurreny space.