Cryptocurrency is a digital-only money that’s decentralized, private(ish), and trying to disrupt money as we know it.
Now, I am NOT a cryptocurrency expert; yes I know about the blockchain than most since I’m a technologist, but I’m also suspicious of “easy money” and “systems that don’t need ‘the government’ ” so I’ve (sadly for me) held back from investing.
Until last week.
Here’s my story so far.
Well, I have officially lost $52 in real money via cryptocurrency. Woohoo!
Mysteriously, I put $50 more, in to another currency (Bitcoin- BTC), and that will be it until Feb 15 when I have more money in my budget to blow.
Pro tip: In my learning about stocks, you’re supposed to put a “stop loss order” in place when you buy – an automation that goes off if the thing you invest in goes below a certain amount, it’ll sell to limit the money you lose. One book suggested setting the stop loss at 8% below purchase price. I have now lost 20% so I can only say that they are right that setting up automatic sales triggers at the time of purchase is a great idea, and I will take that into consideration going forward.
My next plan was to invest “a little” in Ripple (XRP) as it’s traded in places I understand and cheap to buy into, by opening a Kraken account. Then it zoomed down from $3 to $1.14 and I halted. Now it’s back up to $2 (oh wait, now back down to $1.40) so I’m feeling like an idiot for waiting but maybe not. Except I’d already spent my money so what am I even doing planning another buy? Researching. And now it turns out I can’t open a Kraken account in NYC so perhaps it’s cool?
Anyway, my next interest is in buying some of the microcurrencies (under a few bucks), and looking into buying and DASH and Monero, both interesting due to privacy and extensibility and the subject of great debate among deep nerds.
As far as I can tell, cryptocurrency is a good place to learn how trading works for low cost. Coinbase trades are $1, compared to a stock sale which is $5-$10. You can buy literally any amount, and there are plenty of baby currencies that trade for under $1, meaning you can own hundreds of coins for a few bucks and get a cheap thrill.
At the moment, I am thinking of my experiment in cryptocurrency like I do gambling: it’s a way to learn, play, and spend money. I’m committing to putting in about $50/month this year to see what I learn and if I can get anything out of it besides losing $600. Again, I only invest money I’m ok with losing, since this is such a new market it’s hard to understand and there’s few comparisons.
Just like everyone else who’s diving in after BitCoin went 1000x in a few months and made some people quite rich, buying highly valued digital currency really is a weird and potentially bad idea. Then again, if it works, it will transform money as we know it so I’m participating. I’ll even set up my site to accept payment in crypto (give me a few weeks on that tho).
*I picked Coinbase because it’s hosted in the US and I could sign up immediately/easily and pick from several currencies. If you use this link to open a coinbase account and invest $100 we both get $10 in Bitcoin. That said, only invest real money in cryptocurrency if you’re prepared to lose it all. Ok? ok.