Cryptocurrencies are not FDIC insured like money in the bank, and investing in them carries risks. However, there are several signs that cryptocurrency is here to stay. To make informed decisions when investing in cryptocurrencies, it is important to understand the risks and potential rewards. Cryptocurrency is particularly risky compared to traditional investments, and trading it is like gambling.
There is not enough data or credibility to create a long-term investment plan based on cryptocurrencies. To keep your holdings safe, it is important to follow best practices such as keeping a significant amount of stock in your own cold storage and two-factor authentication for users. Investing in cryptocurrencies can be safe, as long as you do your research and learn as much as possible about investing in them. It is recommended to keep your cryptocurrency investments as a relatively small percentage of your net worth, and to invest in several different products to isolate yourself from losses in one of your holdings.
Additionally, it might be easier to sell your investment and get your money back if you invest in companies that use blockchain technologies rather than investing directly. Finally, make sure you have an investment thesis on why each cryptocurrency you invest in will stand the test of time.
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