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Important things you should know before investing

2 min read

1. You need a wallet

A wallet is a digital wallet or digital bank account. It consists of a private key (only for you) and a public key (for everyone you trade bitcoin with). Most brokers and exchanges offer their own integrated wallets. However, these are usually so-called hot wallets, which can be hacked or otherwise compromised in case of doubt. If you have your own wallet, you can protect yourself from such things.

You want to know which wallet is the best? We recommend the Ledger Nano S and the Ledger Nano X. For all further information, it is best to take a look at our provider comparison.

2. Bitcoin is highly volatile (most of the time)

Bitcoin counts as a high-risk asset from an investment perspective. This is because the Bitcoin price is sometimes subject to enormous fluctuations. This is also referred to as volatility. In extreme cases, you can invest 1,000 euros one day and your Bitcoin is only worth 100 euros the next day. Two weeks later it’s suddenly 2,000 euros – not for the faint of heart!

3. 1 Bitcoin is always worth 1 bitcoin

This note ties in with the previous point: If you believe in the technology and value of Bitcoin, don’t let the prices drive you crazy. Because 1 bitcoin will always be worth 1 bitcoin. Understand what that means and keep your cool when the markets go crazy.

4. It’s just a phase

Whether the bulls are raising prices or the bears are spreading doom and gloom, it’s just a phase. So far, every high has been followed by a low and every low has been followed by a high. Anyone who has staying power can usually benefit from Bitcoin if he or she does not get carried away by the emotions. At least that was the case in the past.

5. Keep Calm and Hodl your Bitcoin

Actually, the logical consequence of these tips: try to keep calm. Unless you’re a day trader (and you already know all that anyway), you’re probably safe with a long-term Bitcoin investment. Simply (regularly) buy Bitcoin and collect it in the wallet. Easy.

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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