Do you remember the first time you heard of a smartphone? Can you imagine that a decade from now, not only you, but pretty much everyone you know, would be carrying these little rectangular devices that connect the whole world? If you were someone who recognized that the smartphone would go from being a neat toy to a global necessity, congratulations! However, it is time to recognize another fatality: digital currency. Cryptocurrency, or simply “crypto,” is rapidly becoming legal tender in the world and one day, perhaps sooner rather than later, will become the currency of choice for nations and individuals. Recognizing this now will reduce a lot of anxiety down the road and keep you from feeling left behind. Also, here are some mental exercises to help you prepare to build your crypto portfolio.
Before making such important decisions, optimize your network
Optimizing your network, in this case, means achieving maximum total security for your system. It may seem redundant or even an oxymoron to suggest improving security when talking about crypto. After all, it’s ultra-secure with its virtually impenetrable blockchain encryption. Unfortunately, not everything on your personal computing platform is secure by blockchain, which means there are other portals to your network and therefore to your intellectual property and accounts. You want to make sure that your network connection has SBC direct routing (session border controllers). It will also facilitate the highest quality QoE (Quality of Experience) for users. Since others will connect and interface with you, a good SBC will help create a secure network for your SD-WAN (Software Defined Wide Area Network).
Develop your understanding of how cryptography works
Among other things, crypto is a paradigm shift. It is imperative to understand what this type of currency is and exactly how it works. You probably know that cryptos are decentralized forms of digital currency. The value of a particular crypto can rise or fall like the price of gold or an individual stock on the stock exchange. So, your crypto investment can become more or less valuable without you doing anything. When you invest in a crypto, you are really investing in its blockchain system. As you know, the blockchain has an ever-growing record of every transaction ever made with a particular form of currency. Each crypto has its own different form of blockchain.
Discover individual crypto
For an idea that only came true half a dozen years ago, crypto has really taken off, with over 2,000 different varieties. These will not last. Some cryptos will gain popularity, confidence and stability and some will simply fade and disappear from obsolescence. Since you don’t want to invest your funds in crypto that will fade and die – and your money with it – it’s important to learn all you can on each individual crypto you want to invest in. First, take a look at their “white paper,” which looks like a portfolio of stocks. Then check out what you can on their development team. Finally, take a look at their investor list to see who else trusts them. Yes, it does take a little while, but most of the information is readily available.
Keep your eggs in more than one basket
Diversification is the hallmark of everything savvy investor. Some finance gurus suggest that you should divide your investments into at least 10 different cryptos, which is a lot of paperwork. While it is likely that you will find a crypto or two that are closely aligned with your financial principles, it is still the wisest policy to diversify into a half dozen or more. Much like stocks, cryptos can be divided into high, mid, and low market caps. The exciting part of this is the recognition that these accolades suggest, like stocks, that the value of your funds is bound to rise.
Likewise, there are wealth managers and stock brokers, so there are specialist consultants to help you choose cryptos.