In 2024 more people are investing in cryptocurrency than ever before, but if you’re one of them— do not persuade yourself for a second that you’re late to the game. In fact, you’re still a very early investor in the history and fortunes of this exciting, revolutionary new industry and the entirely new class of digital assets that its developers and communities are bringing to the world.
If you’re just beginning to invest in cryptocurrency and looking for a brief overview of how to invest in cryptocurrency in 2024, this short guide will lay out a map to help you understand where we’re at now and how to navigate your way to the best cryptos and investment strategy for your individual needs, level of knowledge, and your cryptocurrency investment goals.
Let’s start with a big picture view of where we’re at in the cryptocurrency adoption stages curve at the society-wide view, with the total, eventually addressable global market for blockchain technology and decentralized banking and finance in mind.
Where We’re at in Cryptocurrency Adoption in 2024
Source: paybito.com
The market adoption curve, or product adoption curve, is a commonly used mental model in the tech industry for understanding how new, innovative products gain traction and mainstream adoption. It’s impossible to tell exactly how many people own any cryptocurrency at all or use it regularly, because of the pseudo or total anonymity that makes the blockchain so interesting and valuable.
But best estimates clocked the figure at around 4% of the global population at the end of 2024. That puts crypto investors in 2024 at the earliest part of the early adopter’s stage of the curve. If cryptocurrency achieves its goals of mass-market adoption, the way email and social media have by this decade, that leaves most of the upside, industry-wide, ahead of us.
Next Crypto to Explode in 2024: Best Cryptocurrency to Invest in 2024
Source: timesofindia.indiatimes.com
Everyone who’s just now starting to learn about the industry, and researching how to invest in cryptocurrency in 2024, has likely heard of the incredible ROI that early investments in Bitcoin and other digital assets have made. Understandably, you’re hoping to hit a home run with whatever amount you invest in crypto, given the enormous returns that others have made in this space.
But for every investor who has made those kinds of returns, there are a dozen others who bought in at the height of crypto market bubbles and sold off for massive, realized losses on their initial investment. So it’s important to be cautious, understand what you’re investing in, and get ready to run away from anyone hyping specific crypto as “the one” that’s going to be “the next Bitcoin” or “the next crypto to explode in 2024.
The Crypto Market Cycle: Boom, Bubble, Bust, Repeat
When in investing in cryptocurrency, it’s important to remember even the most successful coins— with the largest market capitalization, the most users, the most use cases with the applications actually built out and deployed for users, and the most active, capable, and reputable development teams supporting them— experience major price volatility at the yearly, monthly, and even daily and hourly time scales. That means the price swings up and down drastically.
They also characteristically move through mass-market boom and bust cycles over periods of years or months. Before venturing too much of your savings to invest in cryptocurrency, it’s well worth your effort to research the historical price charts of the crypto you’re thinking about pulling the trigger on buying.
You’ll get some kind of sense of if the market for that coin or token is on the upward swing, in the throes of an overheated boom and in danger of a bust, on the downward swing, or near or just on the other side of a market bottom.
Best Way to Invest in Cryptocurrency
It would be difficult to argue there’s one “best way” to invest in a cryptocurrency that would be true for every reader without reverting to the time-tested, the best general investment advice that has guided investors to results they were happy with to protect and grow their wealth through the stock market and various exotic investment instruments of the last century that stockbrokers and hedge funds began selling after the exchange-traded fund (ETF) arrived. Here are three “best ways” to invest in cryptocurrency:
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“Invest in what you know”
Source: bloomberg.com
This principle advanced by investing legend Peter Lynch is now considered classic investment advice. Lynch directed the Magellan Fund at Fidelity Investments for over a decade ending in 1990. It was the best performing mutual fund in the world under Lynch’s management, doubling the S&P 500 Index’s ROI and returning a consistent 29% annual yield.
When investing in crypto, this means doing your research and actually understanding what the crypto you’re investing in does and why you think it’s valuable or even undervalued by the market at today’s prices. And not just buying in because the price is going up this month, and you read claims that it’s “going to the moon” or will “make you a fortune overnight” that are not substantiated with evidence.
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Diversify
John Bogle is another legendary investment figure on Wall Street. The founder and chief executive of the Vanguard Group, he’s the guy who invented the first index fund. The principle behind his invention, and the animating principle of his successful career as an investor, was diversifying your portfolio— and holding it.
Rather than active management, day trading, and all that, Bogle saw that the most consistent returns could be made with a diverse allocation within a sector or across sectors. This makes sense in crypto investing because if one of your holdings is underperforming, one of your others might be overperforming, and balance out your portfolio that way.
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Dollar-Cost Average
Source: news.abplive.com
Dollar-cost averaging is a time-tested, market-approved method for balancing out volatility in security you’re taking a long position in, so it’s very useful in crypto investing, especially for the risk averse. Rather than investing a large sum in a cryptocurrency all at once, dollar cost averaging means buying the same amount at the same interval (monthly or weekly) to save your money on that asset.
It is headache and heartache free. There’s no second-guessing, trying to time the market, or letting your emotions get the better of you as they have many professional and highly knowledgeable day traders. You just do the same thing every week or month with a predetermined amount of savings.
If you had done this starting the day Bitcoin hit its all-time high price in Dec 2017, and just kept at it for two years through Dec 2019, your gains would have slightly outperformed the Dow Jones Industrial Average’s overall ROI starting and ending that same period if you had invested the entire sum in the Dow that first day and forgot about it. So this is a relatively reliable way to get healthy returns.
How to Find a Secure Wallet to Store Your Crypto Savings, Spend From, or Manage Your Holdings 2024
Source: legalexaminer.com
One thing you’ll need for sure to invest in cryptocurrency in 2024 is a secure wallet to store your savings. The simple and most popular way to hold your cryptocurrency in a wallet is to download one for mobile from the App Store or Play Store that runs on your secure Apple or Android mobile phone OS.
If these apps have passed the rigor of quality standards Apple and Google apply when approving financial apps for your phone (and the additional scrutiny that crypto industry apps undergo), they’re fairly well secure for a beginning cryptocurrency investor to get started.
Among the many good options available, I recommend the CoinStats app for a starter investor’s crypto wallet, because it has such a wide selection of cryptocurrencies, seamless integrations with other wallets and crypto exchanges, an open doorway to the fast-growing DeFi blockchains and tokens, and very accurate price updates on all the coins the app tracks.
So for example, if you want to check the current BNB price, you can on your app, and then swap for it, or swap it out for another coin in your portfolio. And the app makes it easy for you to do all your crypto markets watching and investing in one place.
