The year 2020 seems auspicious and could bring new cryptocurrency-related opportunities. If you have been examining the possibility to invest in cryptocurrency for the very first time, or even if you now consider yourself a seasoned trader, our 2020 Guide will introduce you to the crypto assets which could be the very best this year. In this article, we will give you some tips to make strategic investments and understand where to take some appropriate risks.
What are the implications of virtual currencies?
In order to invest in cryptocurrency, possessing in-depth knowledge of the market is essential. With over 1400 assets created to this date, finding the most interesting cryptocurrency can often be quite the endeavour. It is indeed crucial to avoid the usual pitfalls, such as investing without taking the whole market into account. This is of the utmost importance if you wish to be aware of all the opportunities – and risks – associated with a given investment.
Considering your project to invest in a related cryptocurrency
Among all the virtual currencies developed since the launch of Bitcoin in 2009, not all of these 1400 crypto assets can bring the same advantages to the table for your personal or professional project. For instance, every cryptocurrency out there will allow you to benefit from one or more of the following criteria:
A new payment system
Launched in 2009, virtual money had an original goal which was to bypass banks and financial authorities to make exchanges more flexible. Bitcoin stands as the leading representative of this way of thinking and puts forward Blockchains through which exchanges between two Bitcoin addresses can be significantly accelerated. Not all cryptocurrencies in this category offer the same exact features: level of anonymity, transaction speed, number of units in circulation, defined governance types, etc.
An infrastructure-oriented system
The Blockchain system delivers its true potential and allows the creation of ‘smart contracts’ and Dapps (Decentralised Apps). For instance, dedicated platforms offer the possibility to create a derivative, personalised cryptocurrency to raise capital, to create secure, publicly shared databases, a certification ledger, a decentralised voting system, etc.
A special-use system as part of a service
As part of token creation, computing protocols evolve to offer ever more specific services. Such currencies constitute a way to personalise exchanges, to distribute assets more rapidly, to encrypt files, to store and retrieve data, etc.
Where can I buy cryptocurrency?
If you wish to invest in cryptocurrency, the first necessary step is to know where to purchase it from. To that end, understand that there exist two solutions:
Signing up to a dedicated platform to invest in the cryptocurrency of your choice, Bitit being one particularly compelling example.
Opting to invest in cryptocurrency in the form of CFD.
Dedicated platforms don’t all apply the same prices, offers (transaction times, wallets, crypto assets available, etc.) and processes. Depending on your personal or professional goals, it is important to choose a platform suited to your individual needs. These platforms vary in ease of use and some require you to have a deeper understanding of virtual exchanges and to master languages that amateur traders may find arcane. If you are only getting started, our advice is to select a more user-friendly platform which uses a more approachable language and to know all your options to invest in cryptocurrency safely. Bitit boasts quick and easy access to over 50 crypto assets, which is ideal for beginners looking to make their very first investment.
To purchase cryptocurrency as a CFD (Contract for Difference) product, a stockbroker will offer you to purchase a certain amount of cryptocurrency. They will stipulate that the seller is required to pay the buyer the difference between the current value and the value on the subjacent contract date. If the latter is negative, the buyer needs to pay the balance to the seller.
How to invest in cryptocurrency?
If you wish to invest in cryptocurrency, it is paramount to understand your investment’s buying and selling potential. Thanks to this, it is entirely possible to purchase real estate, a car or even clothing online from a compatible website, from professional sellers or from individuals who accept payments of this nature.
The various levers to convert your money into cryptocurrency
Once you have selected the ideal cryptocurrency for your project and chosen the most interesting platform or CFD product, it is time to progress with your actual investment.
Depending on the platform you have chosen, you will be able to convert your money into cryptocurrency using:
A credit or debit card: the simplest and quickest option, which is equivalent to any e-commerce-type purchase.
A bank transfer: you may proceed with a SEPA transfer from your European bank account. This type of transaction is supported by many platforms at your disposal.
Cash: by purchasing prepaid cash cards (such as Paylib or Neosurf) from a retailer. On Bitit, you may then convert the value of this card into cryptocurrency in no time at all.
It is worth noting that all these examples require going through a dedicated platform, which will always ask for proof of your identity, as per the legislation.
Which cryptocurrency should I invest in?
Are you looking to invest in cryptocurrency while making sure your investment will be profitable? Here are three interesting cryptocurrencies with a strong reputation. Which doesn’t mean you shouldn’t be careful: even if virtual money doesn’t depend on financial institutions, its fluctuations are very significant, so be vigilant regarding your investments.
Bitcoin (BTC): The King of cryptocurrencies
Undefeated, Bitcoin is still at the top of its game for anyone wishing to invest in cryptocurrency. To this date, this crypto leader boasts the same excellent reputation as ever and remains a firm favourite among investors. While it is seen as the best cryptocurrency on the market, it isn’t the only one to be widely considered as a reference. What truly matters if you want to start to invest in cryptocurrency is to understand how the technology works. Furthermore, Bitcoin is the ideal entry point into the world of cryptocurrency.
Ethereum (ETH): Did you say DApps?
Ethereum counts as one of the main cryptocurrencies on the market. Its added value is the fact that it is capable of putting all the potential of Blockchain at the disposal of companies, big investors and individuals alike so they can take advantage of ‘smart contracts’ and ‘DApps’ (Decentralised Applications). Defining these smart contracts is a way to reinstate confidence between buyers and sellers thanks to a trusted third party playing the role of a notary or lawyer.
Stellar (XLM): The most underestimated crypto asset in 2020
Amongst all the cryptocurrencies, let’s not forget about Stellar, an asset for which investors have shown a renewed interest over the past few years. Stellar Lumen allows, among other things, to carry out exchanges and international payments in the form of microtransactions. The group’s wish is to create a worldwide payment system which enables people who do not own a bank account to make payments easily and legally. The system is praised for its transaction speed (2 to 3 seconds to complete a transfer) and its very low fees of only a few cents. This great advantage could make all the difference to seasoned and new investors alike.
Our selection of promising cryptocurrencies for 2020
As we have already covered the most promising trio for 2020, we would now like to introduce 3 other cryptocurrencies in which investments could be a little riskier, but still very encouraging given the results observed over the past few months. As the season of altcoins begins, those who wish to invest in cryptocurrency need a sound, well thought-out strategy.
Are you looking for a future-driven cryptocurrency? Dash (for Digital Cash) aims to emulate the way in which cash works to simplify exchanges and make them entirely anonymous. High transaction speeds and very low fees make it a promising asset which may well take precedence over the others.
Ever since its very convincing growth in 2017, Ripple has remained one of the top virtual assets, put forth by banks which give it all their support. UniCredit, Santander or UBS utilise its Blockchain to transfer funds without any associated fees. Our advice is not to wait too long if you wish to invest in this cryptocurrency as it is still in a phase of development.
Often considered to be Bitcoin’s smaller and better brother, the cryptocurrency Litecoin was created in 2011 by Charles Lee, an ex-Google employee. Its main characteristics reside in its Blockchain, which improves upon Bitcoin’s and allows for faster exchanges and lower transaction fees, making it ideal for everyday transactions. It is estimated that Litecoin could be produced in huge amounts to reach a total of 84 million Litecoins.