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The 3 Biggest Mistakes That Stop Cryptocurrency Investors From Getting Rich
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Cryptocurrency is an emerging industry that has recently experienced rapid growth. Due to the young age of the industry and the uncertainty surrounding the future of online transactions, currencyThe cryptocurrency market can be volatile at times.
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Many people have jumped on the cryptocurrency bandwagon and chosen to invest because it is both trendy and flashy, leading some uninformed investors to lose money on their investments.
According to Forbes MagazineOnly 13% of surveyed cryptocurrency investors reported breaking even. Additionally, only 28% of investors claim to have made a profit from their investments.
Only a small number of investors are making money from their crypto stocks. This begs the question: What mistakes are preventing crypto investors from getting rich?
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1. Invest emotionally
One of the problems facing cryptocurrency as a new, often sensationalized investment opportunity is that it is overhyped.
“One of the main challenges is the psychological factor in which the investor has an affinity with investments,” said Daniel Krupka, research director at Coin Bureaua website specializing in cryptocurrency trends and investment advice.
New cryptocurrency investors can invest when prices are skyrocketing and certain currencies are trending.
“This is because when trading, emotions such as fear, greed and overconfidence take over and this causes investors not to act rationally,” Krupka said.
Factors such as celebrity endorsements or media coverage can lead to emotional investing. Investors risk losing money by making decisions based on their emotions of the moment, rather than changing their perspective for the long term.
2. Ignoring market trends
The deliberate choice to ignore the trends in the cryptocurrency market is what leads to the downfall of many investors. Often, cryptocurrency investors are obsessed with their own expectations and goals.
“The market does not take into account personal goals and operates according to its own logic,” Krupka said.[Recognizing these] “Signals are important for successful investing, but they require technical analysis to be well understood.”
When you focus too much on personal goals, it’s difficult to see the bigger picture and use external factors, such as real-time market updates and trends, that can help investors make smart decisions.
By staying on top of market trends, cryptocurrency investors reduce their risk of making costly mistakes.
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3. Not enough research
With our current ability to communicate through social media sites like Reddit and YouTube, it is easy for misinformation to spread and outdated investment strategies to circulate.
Some cryptocurrency investors take the words of influencers or celebrities as the absolute truth without doing any research in their spare time.
“Cryptocurrency investing is all about learning and planning to get the best results,” Krupka said. “In order to understand and predict market trends, investors need to be familiar with different market analysis strategies.”
As is the case with cryptocurrencies, many people want to cash in on the hype without doing their own research on which investments could prove profitable in the long run. By doing their due diligence, cryptocurrency investors can make informed investment decisions and potentially become wealthy.
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This article was originally published on GOBankingRates.com: I’m a Crypto Expert: The 3 Biggest Mistakes That Stop Crypto Investors From Getting Rich