Cryptocurrencies and digital currencies have been hitting new highs in terms of value and popularity.
While a lot of things went into a slump during 2020, cryptocurrencies continued to rise and were on an impressive trajectory towards the end of 2020.
The same pattern continued into 2021, where cryptocurrencies not only gained a lot of value but wider acceptance as well.
What is an Altcoin?
You might come across the term altcoin every once in a while. In case you’re wondering what it is, altcoin basically refers to cryptocurrencies apart from bitcoin and upon looking carefully at the term, we can intuitively say that altcoin is basically the shorter version for alternative coin.
Altcoins were launched after bitcoin was embraced and celebrated by the masses and we currently have over 5,000 cryptocurrencies in circulation.
Altcoins can consist of various types such as those that are mining-based, stablecoins, security tokens, and utility tokens. Some common examples of altcoins include Neo, Iota, Dash, Coin, Ripple, Litecoin, and many more.
How to Buy Your First Altcoin
Buying the first altcoin might be an intimidating task for beginners, particularly because they’re considered about the risk that they’re being exposed to. Here’s how to buy your first altcoin and make well-informed decisions.
Choose an Altcoin
The first step towards purchasing your first altcoin is to choose the one that would be a smart investment. Ideally, you shouldn't make this decision intuitively and instead do thorough research into the trends and specifics about the altcoin that you’re willing to purchase.
While there are a few thousand altcoins to choose from, basic secondary research can help you narrow that list down to under 20. Then, you can proceed towards more thorough research and can analyse the trends and predictions associated with them and choose an altcoin that you believe provides a decent return with managed risks.
Determine the Percentage
If you’re someone that invests in multiple portfolios, it is important to determine the percentage of your investments that you would like to dedicate towards altcoins. These decisions are usually made in accordance with your investing profile and risk tolerance. Once you’ve got a good idea about that, you can proceed and choose which altcoin to purchase.
Find an Exchange Service
There are two ways to purchase an altcoin. One type of exchange allows you to purchase altcoins using actual money via credit card, but these exchanges are relatively less common.
Most altcoins can be acquired by exchanging them with Bitcoin (BTC).
First up, you’ll need to find an exchange that allows you to convert your fiat currency into BTC and then an exchange that allows you to trade your BTC for your preferred altcoin. This could also be done at the same exchange if you can find one that does it and stocks your preferred altcoin as well.
It is imperative that you only deal with trusted and well-reputed exchanges in order to ensure that your transactions are secure.
Choose the right time
Timing is often the key element that can literally determine how successful your investment is going to be. There’s always a good and a bad time to invest in any altcoin and you need to make sure that you choose the good time. If you’ve done sufficient research, you will be able to determine whether it is the right time to dive into an altcoin or not.
Invest Responsibly and Enjoy
Your investment should never be rushed and ill-informed. If you’re a beginner, you may consider using tools and software to assist you with your investing strategies. You may go through applications such as crypto engine review that will allow you to utilize trading signals generated to AI-driven algorithms, to minimize risk and maximize returns.
