With so many available cryptocurrencies, its often hard to put your focus on just one cryptocurrency. Of course, many investors will invest in multiple currencies and as a matter of fact, this is sometimes unavoidable (some currencies can only be bought with other cryptocurrencies for example) but even so, the markets are a minefield at the moment, making it really difficult for investors to decide how to proceed.
Therefore, how do you choose your perfect cryptocurrency?
There’s no real answer to this question. What we want to do however is give you a few pointers on what to look for, to at least guide you away from sticking all the cryptocurrencies in a hat and just drawing a name out at random. That would be a bad move.
First off, consider your local area regulations. For example, some countries are notoriously against privacy focused cryptocurrencies and are working towards establishing new regulations for them. If this is something that could affect your investment, consider how it will move the price of the currency. Moreover, countries like the United States, individual state laws are changing that could see harsher restrictions places upon privacy focused coins in the future, therefore, before you buy, take a look at how regulations and legislation could impact your investment.
Next, wallets and exchanges. It is far wiser to choose a cryptocurrency based on its availability within ‘safe’ wallets and exchanges. Put it this way, if you wish to buy a cryptocurrency that is only available on an exchange that seems to have been hacked 3 or 4 times in the past few months, perhaps it might not be the wisest move.
You should also consider both history, and the future. You don’t need to become a time traveller, but, you should be researching how currencies have performed in the past and how they look to be performing in the future. Is the currency going to fall under any upgrades or changes that will affect your investment? Historically, how secure is the currency?
All of this is simply just due diligence. It is important though. We always say it, but research should act as the epicentre for your investment decisions. It is through research that you will find your perfect cryptocurrency, your perfect match.
That is, until someone inevitable develops a cryptocurrency match making app that does all the hard work for you!