If you’re interested in cryptocurrency past its value in utility, then you might be considering investing in some of it. Interestingly enough, investing in cryptocurrency isn’t as different as investing in any other stock for the most part.
For example, if you’re looking to participate in an Initial Coin Offering (ICO), it’s up to you to do your own due diligence. Much like regular companies going public, companies offering ICOs will generally release prospectus to attract investors.
A good sign will be the reputation of the company doing the ICO, along with whom other notable investors are. Since these are all likely to be digital offerings you also need to be aware of whether you’re buying a slice of the company or merely some value equivalent in the cryptocurrency.
ICO vs Dot Com Burst
Investors who were around for the dot com burst also have to be aware that there is a distinction between a currency that is new and that is still under development. Developmental currencies are much higher in risk profile and the company carrying out the ICO is likely looking for funds to further develop it.
While all of this may be the ‘same old’ for seasoned investors, the digital nature brings to the surface yet another risk – security (read more here).
Final Thoughts: No Harm Trying
As you can see, while cryptocurrency may be a little daunting, the mechanics of it aren’t really different from other forms of digital currency. In fact, the security on cryptocurrency is often much higher than most digital wallets can provide.
There isn’t much harm in signing up for a cryptocurrency wallet and buying small amounts of currency to experiment with. As long as you don’t dump your life savings into your crypto wallet, you should be fine.