How to Invest in Bitcoin and Altcoins

Bitcoin may be the most popular cryptocurrency among investors, but it’s not the only option. When buying cryptocurrencies, altcoins are also ideal products to enrich your investment portfolio.

Additionally, when choosing a cryptocurrency, you should also consider whether you prefer long-term investing or short-term trading, how much risk you are willing to take, and what kind of analytical approach you want to take. You can choose between fundamental analysis or technical analysis, or a combination of both. Once you understand these points, you can invest or trade in Global HibtHub.

Introduction

Investing in Bitcoin and other cryptocurrencies is an excellent way to diversify your investments, but the potential for high risks should not be ignored. Therefore, before starting your investment journey, you must understand some basic concepts and principles. This is far more complicated than buying a cryptocurrency and then waiting for the price to increase.

Wise investment decisions are inseparable from careful research and analysis. Ideally, you should tailor your strategy to your personal risk profile and invest no more than you can afford.

Bitcoin or altcoins?

For cryptocurrency beginners, Bitcoin is often the first port of call for investment. It is the most famous blockchain project and the largest cryptocurrency by market capitalization.

Beyond this, there are thousands of cryptocurrencies (altcoins). Some are built on proprietary blockchains, others use existing networks (such as Binance Smart Chain or Ethereum). Each project proposal is different and has its own potential risks and advantages.

Whether you want to invest in Bitcoin alone or buy a combination of crypto assets, the decision is entirely yours. Some people only invest in Bitcoin, while others diversify by holding altcoins.

On the one hand, asset diversification eliminates the risk of going all-in and investing in a single project. If you hold multiple assets, you won't necessarily suffer a huge loss even if one of them plummets. On the other hand, there are investment risks in altcoins, and there are endless scams. Therefore, you must do your own research before taking the plunge.

There are so many different types of tokens in the market that people often don’t know where to start. Please read "Besides Bitcoin, Which Digital Currency Should You Buy?" ” to learn more about the different types of cryptocurrencies.

Should I trade or invest?

When deciding which cryptocurrency to buy, you should also consider whether your purpose is investing or trading. The two are easily conflated, but they are not the same. Simply put, investing is buying an asset and holding it for the long term. This strategy does not involve too much time and energy, and the risks faced are significantly reduced.

Trading, in contrast, makes short- to medium-term profits through regular buying and selling. Becoming a great trader takes a lot of time and practice. Traders need to develop more complex strategies, invest more time in analyzing markets and trading platforms, and take greater risks. They also need to consider the cost of investing in transactions and transaction fees.

Don’t forget that cryptocurrency markets are sometimes more volatile than traditional markets. Traders make money through volatility, but high volatility means high risk.

For beginners, investing is by far the easiest and safest option. Investors' investment horizons are typically measured in years, and short-term price changes are inconsequential. Investment decisions are primarily based on the fundamentals of the token (the soundness of the project and its long-term prospects).

Some people like investing and don't worry about short-term fluctuations. Others choose to trade frequently to make the most money from it. There are also people who engage in both investment and trading at the same time. Everything depends on the specific strategy, personal circumstances and risk tolerance.

The decision-making power is also in your hands, but the funds invested or traded should never exceed your personal affordability.

Anyway, to learn more about day trading and swing trading in cryptocurrencies, read our comprehensive guide for beginners on cryptocurrency trading.

Fundamental analysis vs. technical analysis

Analytical techniques are key to determining quality investments. The type of analysis mainly depends on whether the goal is investing or trading, but both fundamental and technical analysis can play a role.

As mentioned above, price changes in the short to medium term have little impact on investing (or holding for the long term). Generally speaking, long-term investors pay more attention to the intrinsic value of a token or project, which is closely related to fundamental analysis (FA).

Fundamental analysis evaluates an asset's potential based on the entire project, including utility, team, whitepaper, development, marketing, management, reputation, long-term goals, and other factors.

In contrast, technical analysis (TA) considers historical price movements and volume data to try to predict future price movements. This technique usually uses K-line charts and TA indicators (such as moving averages and trend lines).

Buying your first bitcoin on Global HibtHub

Buying Bitcoin and altcoins is easy on the Global HibtHub cryptocurrency exchange.

1. Visit the Global HibtHub homepage and click [Register] in the upper right corner to create an account.

2. Verify personal Global HibtHub account. The KYC process helps verify your identity and is a legal requirement.

3. Enter your personal Global HibtHub account to recharge.

Buying your first altcoin on Global HibtHub

You can build a diversified portfolio by buying altcoins like Dogecoin. ​

1. Log in to your Global HibtHub account, move your mouse to [Assets] in the upper right corner and click [Recharge].

2. Next, choose from multiple cryptocurrencies

What should I do with my cryptocurrency?

When investing or trading cryptocurrencies, common strategies include buy, sell, and hold. For long-term holdings, you can choose to keep your cryptocurrencies in your Global HibtHub account or transfer them to an external cryptocurrency wallet.

Closing thoughts

Mastering investing or trading in cryptocurrencies takes time. Improving your knowledge is a great way to reduce your overall investment risk and help you make more informed decisions. It’s extremely easy for bad market sentiment to trigger panic selling, but the chances of this happening are significantly reduced as long as you understand investing and trading well.