Cryptocurrency is in hype now and its stride towards legitimacy is still going strong. Before leaping into major investments, it is essential to learn about the system.
With the current situation of the cryptocurrencies, it would wise not to invest a vast sum which makes it a viable option for students. With the tremendous growth potential, even a small investment could bring substantial profit. It was not so long ago that Bitcoin and Ethereum were less than $5 a coin. Today, there are still a few cryptocurrencies in the market that costs around the same.
Any investment would need considerable time to do the necessary research. Before setting aside this time, students need to attend to their educational bearings first. A smart way to tackle urgent deadlines is to seek the help of online services. Among the popular resources, EssayPro essay writing service has always been a reliable platform for students to get their assignments done. The professional writers on their team consistently offer high quality written content as requested by students.
With the part of college work taken care of, let’s see how students can get involved with cryptocurrency investing.
How to Invest in Cryptocurrency as a Student?
As college students, this might appeal as one of the easiest and quickest ways to make some money. At the same time, the number one constraint is the lack of capital to make an investment.
Fortunately, as mentioned before not all cryptocurrencies can break your bank. The best tactic for students is to buy a small portion in multiple cryptocurrencies increasing your chance to win more money and minimize the chances of risks.
If it takes off, the returns would be sizable even for a small amount of money. Considering that there is risk involved in even the popular cryptocurrencies, this is the safest way to proceed with caution.
But to realize this capital amount, students might have to give up on a few leisure and save it up. The sacrifice could result in substantial potential returns.
Other than this approach, these are the different ways to proceed with cryptocurrency investment.
- Airdrops
Students are obviously looking for the cheapest ways to earn from cryptocurrencies. This is the one way to obtain the coins them for free. Airdrops happen when a blockchain gives out free coins or tokens of cryptocurrency. But wait, to get access to these airdrops, you already need to have a token. And how to obtain a token? To qualify for one, one has to acquire currency and hold on to that for a specific timeframe. These requirements vary from coin to coin.
- Mining
Mining of cryptocurrency is a term that has been circling a lot. To understand how this works, it is imperative to know how blockchain works. Every transaction done by cryptocurrency is recorded as blocks. Every time a transaction is made, a new block is created and whoever appends the block gets a percentage of the currency involved in the transaction.
To minimize the devaluation of currency by mining, the task can be achieved only by solving complex mathematical problems. It was possible to do mining from anywhere, and by anyone; now there are a few restrictions regarding the hardware requirements. There is a finite limit to the number of coins available and beyond that mining will not be able to acquire more.
Does this sound like a complex way to earn coins by geniuses? Here are a few other ways of investing in cryptocurrencies.
- HODL
This famous typo that has now become a prominent method of cryptocurrency investing. HODL or holding on cryptocurrency is similar t the workings of a stock market., holding out on an investment hoping that the rate might go off the roofs to get a raise.
This method is considered as the long term investment in the currency.
However, this might not be the best option for a bear market. For that, the trick is to diversify.
- Dividend Payouts
The other strategy is to look for ways to earn passive income that is more stable and received on a regular basis. Coins like VeChain and NEO has the option for Crypto dividends and has a payout between 5 to 10 percent. Bear in mind that, these returns will also be in cryptocurrencies, which would be handy if the coin price goes up.
- Arbitrage
Arbitrage is the simple strategy of buying the coins at one price and selling it at a higher price elsewhere. We all have used this strategy for something or the other on our lives. The key here is to find the right place to buy the coins at the cheapest rates possible.
Check multiple cryptocurrency exchanges and compare the rates for coins and go with the cheapest option. Then transfer the coins from one exchange to another for a higher margin to earn a profit.
Final Thoughts
Any investment is a tricky business, especially cryptocurrency. As much as it is exciting and struggling to make investments while in college, before spending your savings, it is always wise to take due diligence and talk to experts.