Cryptocurrency has been on quite a wild ride since it launched back in 2009. Today, it is quite a controversial topic among investing experts. This is largely because it’s volatile and only loosely regulated.
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Though vexed and always under heated debate, the crypto market is still a formidable and popular investment sector. For example, by the end of 2021, it was estimated that close to 300 million people worldwide owned some type of cryptocurrency, according to crypto.com, as reported by Forbes.
You may be wondering what the year may hold for this booming but contentious space. Let’s hear what financial experts think — and what you should take into consideration before investing, or building out investments, in crypto in 2024.
Project Legitimacy and Security
Not all cryptocurrencies are the same, and some crypto projects are, well, sketchier than others. This is why it’s imperative to do your homework on each crypto project you’re thinking about making a move in. Ensure it’s legitimate and secure.
“Look for a clear roadmap, a competent team and a transparent business model,” said Dmitry Mishunin, CEO of HashEx.
You should also ensure the project has undergone a thorough security audit by a reputable firm.
“This is crucial for smart contract-based projects to prevent vulnerabilities and hacks,” Mishunin said.
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Valuation Challenges
Part of what makes crypto difficult to understand — for newcomers, in particular — is that it doesn’t align with traditional valuation models.
“Prices are less driven by fundamentals and more by narratives, such as Bitcoin being perceived as digital gold,” said Daniel Krupka, head of research at Coin Bureau.
Be wary of storytelling that veers wildly in favor of crypto. Focus on what your research renders instead.
Information Quality
Another thing to consider when approaching crypto is that quality information is hard to come by. This, Krupka said, is due to biases and technical complexities.
“Successful investment often hinges on thorough, independent research and understanding the…
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