Should YOU invest in cryptocurrencies?

Do NOT invest in crypto unless you can say YES to these 6 questions

Everybody wants to invest in crypto. Including my house help's 14-year old son. True story.

I am always asked HOW to invest in crypto. But I think the most important question people should ask me is, "Should I invest in crypto?".

Crypto is a new, small, highly immature, and extremely volatile market.

Don't invest in crypto because you think it's "cool". A fixed deposit with a boring bank might not sound cool but may be a better investment for many people.

6 questions

Let's start with 6 questions that you must answer honestly:

  1. Can you afford to lose your entire crypto investment?

  2. Are you tech-savvy and ready to learn how to keep your crypto safe?

  3. Are you ready to spend a good amount of time every single day researching cryptos and monitoring your portfolio?

  4. Can you wrap your head around the fact that crypto prices depend more on tweets by (evil?) billionaires like Elon Musk and less on logic and economics?

  5. Are you ready to understand the meaning of stuff like this? - "Sharpe Ratio is the average return earned in excess of the risk-free rate per unit of volatility. Volatility measures the price fluctuations of a cryptocurrency and is usually calculated using variance and standard deviation."

  6. Are you ready to spend time looking at graphs like this?

If you can honestly answer "yes" to all these questions, then let's talk about some recent crypto disasters:

A cryptocurrency called Internet Computer (ICP) started off in the top 10 cryptos of the world. And then crashed more than 90% in a month - from a price of $737.20 to $20.08.

A cryptocurrency called TITAN went from $52.46 to $0.00000003 in 10 days! One of its most famous investors was the non-evil billionaire Mark Cuban. Yes, even super-smart billionaires make bad crypto mistakes.

A cryptocurrency called SafeDollar suddenly went to 0. And this was a stablecoin - its price was supposed to be "stable"!

Still sure that you want to invest in crypto? Great, continue on...


Next: How to buy, sell & hold crypto