If you plan to get into the cryptocurrency game this 2023, you’re not alone; 4 in 10 poll respondents plan to do the same. This indicates that demand for crypto remains high, despite its volatility.
Fortunately, crypto brokers, exchanges, and ATMs have simplified buying and selling Bitcoin. You only need to register, fund your account, and choose your transaction.
However, that simplified process won’t protect you from beginner Bitcoin investment errors. You still need to be aware of these blunders to avoid them.
Below, we’ve rounded up the biggest mistakes you don’t want to make, so read on.
1. Investing in Bitcoin Alone
One of, if not the most crucial Bitcoin investment strategy is never to invest in this crypto alone.
Bitcoin is only one of the 8,800+ cryptocurrencies that remain active to date. It’s undoubtedly the most valuable, but as the adage goes, you should never put all your eggs in one basket.
Instead, you should add other types of crypto to your investment portfolio. For instance, you can buy Ethereum or Dogecoin on top of Bitcoin through crypto ATMs. They accept cash and cards, according to www.bytefederal.com/bitcoin-atm-near-me/texas/dallas/.
2. Not Preparing for Losses
One of the primary reasons many people invest in Bitcoin is its high reward potential. Indeed, Bitcoin investment profits are behind the wealth of most crypto billionaires. There are 19 such billionaires, not counting the thousands of crypto millionaires.
That potential comes at a price, though; the risk of massive losses. This is due to Bitcoin’s extreme volatility; its value can crash within a week, even overnight.
That’s another reason not to invest in Bitcoin alone or believe it’s a get-rich-quick scheme. Instead, spread your other funds on low- and mid-risk assets. Most importantly, prepare yourself for huge losses and only treat profits as a bonus.
3. Using Savings to Buy Bitcoin
Even if you’re one of the 45% of Americans with at least $1,000 saved up, you shouldn’t tap it to purchase Bitcoin. Instead, keep building your savings monthly. After that, use only a portion of your excess discretionary income to buy crypto.
Otherwise, you may be in a financial pinch if you encounter a sudden emergency expense. Things could even be worse if Bitcoin’s value also drops around the same time.
4. Forgetting About Bitcoin Wallet Security
Buying and selling Bitcoin requires a cryptocurrency wallet. After all, this is where you store your private keys. These keys, in turn, are necessary to authorize your crypto transactions.
You risk losing your private keys if you don’t secure your wallet. And when that happens, you lose access to your digital currencies.
The most secure option is to store your keys in a cold hardware wallet. You can use this for your long-term Bitcoin and crypto storage.
You can also use a reputable hot wallet for Bitcoin you plan to spend, trade, or sell soon. Afterward, move whatever you have left or your profits into your cold wallet.
Avoid These Beginner Bitcoin Investment Errors
Committing beginner Bitcoin investment errors can put your financial security on the line. For example, if you spend what you should have saved on Bitcoin, you may be unable to fund an emergency expense. Likewise, putting all your investment funds on Bitcoin alone can lead to huge losses.
So, steer clear of those beginner mistakes to avoid risking your finances.
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