Depending on your circumstances, you might be interested in purchasing a Bitcoin as an investment and monitoring its price movement throughout a longer period. On the other hand, you might be more interested in jumping right into the practice of buying and using digital currency to pay for goods and services. The following is a quick reference to some of the dos and don'ts of Bitcoin that you should keep in mind. So, what are the bitcoin dos and donts?

Do's

Learn as much as you can about cryptocurrency before you buy

Conduct an in-depth study on the topic you wish to acquire before purchasing digital assets. "Don't invest in what you don't understand," advises a well-known investment saying. This is sound advice. It is necessary to educate yourself on the inner workings of blockchain technology and cryptocurrencies, in addition to the distinctions between the most common types of digital assets. That way, you will have an accurate understanding of each coin's value and the token you are contemplating purchasing, both its present and potential future value.

Only use reputable exchanges

Acquiring digital assets may be done in a variety of different ways. When you have determined the assets you want to purchase and utilize an online exchange, it is critical to make sure that any transactions you do take place only on trustworthy and safe platforms. There are hundreds of exchanges for bitcoin and other cryptocurrencies, but only a few are regulated.

The vast majority of exchanges need to give a better deal of openness on how they run their businesses, how effectively they are financed, or how they manage their cybersecurity. Trading on tiny, foreign exchanges that are not subject to a lot of regulatory supervision might lead to an unanticipated loss of cash due to an operational mistake, a hacked exchange, or an exit scam. These three scenarios are all possible. Because all of these unfortunate occurrences have occurred in the past, there is a compelling case to be made for doing business only on trading platforms with a good reputation. However, even systems like that may be compromised.

Ensure the safety of your digital belongings

As soon as you have acquired bitcoin and other digital assets, keeping your holdings in a safe personal wallet is necessary. This should be done as soon as possible after making the purchase. There is a diverse selection of wallets available; however, hardware wallets, like Ledger, Trezor, KeepKey, and BitLox, are often regarded as the best safe option for investors who hold their cryptocurrency for an extended period.

Never invest more money than you can comfortably afford to lose

When investing in digital assets such as bitcoin, it is essential to remember that you should only invest what you can afford to lose. This is one of the most important things to keep in mind. Bitcoin is a very volatile commodity that may quickly lose half of its value in a relatively short period. This is true even though bitcoin is currently on an upward trend, and many industry experts expect that we will see it exceed its prior highs sooner rather than later. If you want to invest in the asset class, it is preferable to only devote a modest part of your investment portfolio to digital assets. The majority of professionals in the field share this recommendation.

Don'ts

Don't let the volatility spook you

Bitcoin and other digital assets are investments with high-risk levels. As a cryptocurrency investor, you must maintain your composure since the bitcoin price is very volatile and may quickly change by ten percent in days (if not hours). Keep in mind that we are not trading stocks here. It is normal for the price of crypto to suffer substantially larger fluctuations throughout the day. If the volatility has you feeling unsettled, you may find it less stressful to refrain from monitoring the value of your digital asset portfolio daily.

Avoid leaving your money on exchangers altogether

Unfortunately, hacking of cryptocurrency exchanges is still common in the markets for crypto assets. Even one of the industry leaders, Binance, has yet to be able to avoid being targeted by cybercriminals. As a result, as soon as you have completed your transactions, you must move any digital asset holdings you may have off of any exchanges in which they may be held and into one or more personal wallets.

Don't fall for a scam

Unfortunately, as the price of bitcoin continues to grow, con artists are also beginning to re-enter the market. When it comes to investment scams, the basic adage "if it appears too good to be true, it usually is" often holds. There are a variety of distinct crypto scams that people should be wary of, but this rule does not apply to crypto scams. You should steer clear of putting money into any investment plan or scheme since there is a good chance that they will be nothing more than Ponzi scams. Instead, if you want exposure to bitcoin and other cryptocurrencies, you should acquire and keep the assets you wish to buy directly.