Category Archives: Cryptocurrencies Trading

The Pros and Cons of Crypto Trading

22 Thursday Feb 2024

Posted by in Cryptocurrencies Trading

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Investors can earn a significant return in a short time, but this means they can also lose a lot of money in a short amount of time. Whether you are a financial advisor, family office, institutional investor, or a recent high school graduate, there are different objectives as well as risk tolerances for investing in cryptocurrencies which must be understood. As with any investment, one should clearly ascertain the risk versus reward and the opportunity cost. If you are considering investing in crypto, understanding the potential pitfalls of cryptocurrency trading risks is essential to success.

What is Cryptocurrency Trading?

Cryptocurrency trading is the process of buying and selling digital currencies to make a profit. It involves speculating on the price movements of different cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, etc., with the goal of generating returns from short-term market fluctuations.

Definition: “Cryptocurrency Trading” is an online activity that allows investors to buy and sell digital assets using various exchanges. Traders can speculate on the future value of a particular cryptocurrency by purchasing coins at one price and then selling them at another when they believe it has reached its peak or bottomed out.

Benefits of Cryptocurrency Trading: One major benefit associated with cryptocurrency trading is that it offers investors access to a global marketplace without any geographical restrictions or limitations imposed by traditional financial institutions. Additionally, traders can take advantage of high liquidity levels within these markets which allow for quick execution times and low transaction fees compared to other asset classes such as stocks or commodities. Finally, crypto traders also have access to sophisticated tools like charting software which can help them identify potential entry points into trades more accurately than ever before.

Despite all its advantages, there are still risks associated with cryptocurrency trading that should be taken into consideration before investing in this asset class. Firstly, due to their volatile nature prices can fluctuate significantly over short periods making it difficult for even experienced traders to predict where prices will go next, meaning profits could easily turn into losses if not managed properly. Secondly, because most exchanges operate outside government regulation there is always a risk that funds may be lost through hacking attacks or fraudsters taking advantage of unsuspecting users who do not know how best to protect themselves online. Finally, some countries may impose taxes on profits made from crypto investments, so it is important for individuals living in those jurisdictions to understand what their obligations are beforehand, so they do not get caught out later down the line.

Cryptocurrency trading is an exciting way to invest in digital assets, but it comes with certain risks that should be considered. In the next section, we’ll discuss some of the key risks associated with crypto trading so you can make informed decisions about your investments.

Understanding the Risks of Crypto Trading

Cryptocurrency trading can be a lucrative venture, but it is important to understand the risks associated with this type of investment. Volatility risk is one of the most significant risks when trading cryptocurrencies. Cryptocurrencies are known for their high volatility and prices can change drastically in a short period of time. This means that traders need to be prepared for sudden price changes and have strategies in place to manage them effectively.

Liquidity Risk: Liquidity risk is another major concern when trading cryptocurrencies. Liquidity refers to how easily an asset can be bought or sold without affecting its price significantly. Low liquidity means that it may take longer to buy or sell large amounts of cryptocurrency, which could lead to losses if the market moves against you before your order has been filled.

Regulatory Risk: Regulatory risk is also something that traders should consider when investing in cryptocurrencies as regulations vary from country to country and even within countries themselves. It is important for investors to stay up to date on any new laws or regulations related to cryptocurrency trading so they do not get caught off guard by unexpected changes in policy that could affect their investments negatively.

Security Risk: Finally, security risk must also be considered when dealing with cryptocurrencies as there have been numerous cases of hacking attacks resulting in stolen funds over the years due to weak security protocols employed by exchanges and other platforms offering crypto services. To minimize this risk, investors should only use reputable exchanges with strong security measures such as two-factor authentication (2FA) and cold storage solutions like hardware wallets whenever possible.

Crypto trading can be a risky venture, but understanding the risks involved is key to minimizing them. By following these tips and doing your research, you can make informed decisions that will help protect your investments. Now let’s look at how to minimize those risks.

Tips for Minimizing Crypto Trading Risks

Diversifying Your Portfolio: Diversifying your portfolio is one of the most important steps you can take to minimize risk when trading crypto. By spreading out your investments across different coins, exchanges, and wallets, you reduce the chances of any single investment going sour. This way, if one coin or exchange experiences a dip in value or security breach, it won’t affect all your holdings.

Setting Stop Losses and Take Profits: Setting stop losses and take profits is another key strategy for minimizing risk while trading crypto. Stop losses are predetermined points at which traders will sell their assets to avoid further losses should the market move against them. Take profits are predetermined points at which traders will sell their assets to realize gains should the market move in their favor. Setting these limits helps ensure that investors do not get too greedy or too fearful when trading crypto and keeps them from making rash decisions based on emotion rather than logic.

Researching: Researching before investing is essential for reducing risks associated with cryptocurrency trading as well. It is important to understand how each coin works before investing so that you know what kind of returns to expect and whether it fits into your overall investment strategy. Additionally, researching an exchange prior to using it can help identify potential issues such as slow customer service response times or inadequate security measures that could put your funds at risk down the line.

By following these tips, traders can minimize their risks when trading crypto and make informed decisions. However, it is also important to be aware of common mistakes that can lead to costly losses to maximize returns on investments.

Common Mistakes to Avoid When Trading Crypto

To minimize the potential for losses, traders should avoid common mistakes such as not setting stop losses or take profits, not doing enough research, and not understanding the technology behind the currency.

Not Setting Stop Losses or Take Profits: One of the most important steps in crypto trading is to set up stop losses and take profits. A stop loss order is an automated instruction that closes out your position if it reaches a certain price level. This helps protect you from large losses if the market moves against you unexpectedly. Similarly, a take profit order will close out your position when it reaches a certain price level so that you can lock in gains before they disappear due to market volatility. Not having these orders in place could lead to major losses if prices move suddenly against your positions.

Not Doing Enough Research: Before investing in any cryptocurrency, traders should do their own research on its fundamentals and technicals to determine whether it is worth investing in at all. Without researching what factors are driving the coin’s price movements, investors may find themselves stuck with coins whose value has dropped significantly without warning due to external events outside of their control or knowledge about them beforehand.

Not Understanding The Technology Behind The Currency: Crypto assets are built on blockchain technology which is still relatively new, and complex compared to traditional financial markets like stocks and bonds where there are decades of data available for analysis by investors who understand how these markets work inside-out. As such, many crypto traders lack an understanding of how blockchains operate which makes them vulnerable when making decisions about which coins they should invest in since they do not have full insight into what’s going on under-the-hood with each asset’s underlying technology stack.

Overall, avoiding common mistakes while trading cryptocurrencies can help reduce risk exposure and increase chances for success over time through smart decision making based on thorough research and understanding of both fundamental and technical aspects related to each coin being traded.

It is important to be aware of the risks associated with crypto trading and to take steps to minimize them. By avoiding common mistakes, such as not setting stop losses or taking profits, doing adequate research, and understanding the technology behind the currency, traders can increase their chances of success when investing in cryptocurrency. Now let’s look at whether crypto is worth the risk.

Conclusion – Is Crypto Worth the Risk?

Before deciding whether to invest in crypto assets or not, it is important to understand the potential rewards and drawbacks of doing so.

Pros and Cons of Crypto Investing: Cryptocurrencies offer investors the potential for high returns due to their volatility. They are decentralized, meaning they are not subject to government regulation or manipulation by central banks. Additionally, cryptocurrencies provide users with anonymity as transactions are conducted on a peer-to-peer basis without any third-party involvement. On the other hand, cryptocurrencies are highly volatile and there is no guarantee that investments will yield positive returns over time. Furthermore, there is an inherent risk associated with investing in unregulated digital currencies since they lack legal protection from fraud or theft.

Ultimately, whether investing in cryptocurrency or not is worth the risk depends on individual circumstances and preferences. Investors should conduct thorough research before making any decisions about investing in crypto assets and consider all possible risks associated with such investments including market volatility, liquidity issues, security threats and regulatory uncertainty among others. Additionally, investors should diversify their portfolios across different asset classes to minimize losses if one particular asset fails to perform as expected. Finally, investors should set stop losses and take profits when trading cryptos so that they do not end up losing more than they initially invested due to sudden price movements caused by market speculation or news events related to specific coins/tokens.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

The Pros and Cons of Crypto Trading

22 Thursday Feb 2024

Posted by in Cryptocurrencies Trading

≈ Leave a comment

Tags

, , , ,

Investors can earn a significant return in a short time, but this means they can also lose a lot of money in a short amount of time. Whether you are a financial advisor, family office, institutional investor, or a recent high school graduate, there are different objectives as well as risk tolerances for investing in cryptocurrencies which must be understood. As with any investment, one should clearly ascertain the risk versus reward and the opportunity cost. If you are considering investing in crypto, understanding the potential pitfalls of cryptocurrency trading risks is essential to success.

What is Cryptocurrency Trading?

Cryptocurrency trading is the process of buying and selling digital currencies to make a profit. It involves speculating on the price movements of different cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, etc., with the goal of generating returns from short-term market fluctuations.

Definition: “Cryptocurrency Trading” is an online activity that allows investors to buy and sell digital assets using various exchanges. Traders can speculate on the future value of a particular cryptocurrency by purchasing coins at one price and then selling them at another when they believe it has reached its peak or bottomed out.

Benefits of Cryptocurrency Trading: One major benefit associated with cryptocurrency trading is that it offers investors access to a global marketplace without any geographical restrictions or limitations imposed by traditional financial institutions. Additionally, traders can take advantage of high liquidity levels within these markets which allow for quick execution times and low transaction fees compared to other asset classes such as stocks or commodities. Finally, crypto traders also have access to sophisticated tools like charting software which can help them identify potential entry points into trades more accurately than ever before.

Despite all its advantages, there are still risks associated with cryptocurrency trading that should be taken into consideration before investing in this asset class. Firstly, due to their volatile nature prices can fluctuate significantly over short periods making it difficult for even experienced traders to predict where prices will go next, meaning profits could easily turn into losses if not managed properly. Secondly, because most exchanges operate outside government regulation there is always a risk that funds may be lost through hacking attacks or fraudsters taking advantage of unsuspecting users who do not know how best to protect themselves online. Finally, some countries may impose taxes on profits made from crypto investments, so it is important for individuals living in those jurisdictions to understand what their obligations are beforehand, so they do not get caught out later down the line.

Cryptocurrency trading is an exciting way to invest in digital assets, but it comes with certain risks that should be considered. In the next section, we’ll discuss some of the key risks associated with crypto trading so you can make informed decisions about your investments.

Understanding the Risks of Crypto Trading

Cryptocurrency trading can be a lucrative venture, but it is important to understand the risks associated with this type of investment. Volatility risk is one of the most significant risks when trading cryptocurrencies. Cryptocurrencies are known for their high volatility and prices can change drastically in a short period of time. This means that traders need to be prepared for sudden price changes and have strategies in place to manage them effectively.

Liquidity Risk: Liquidity risk is another major concern when trading cryptocurrencies. Liquidity refers to how easily an asset can be bought or sold without affecting its price significantly. Low liquidity means that it may take longer to buy or sell large amounts of cryptocurrency, which could lead to losses if the market moves against you before your order has been filled.

Regulatory Risk: Regulatory risk is also something that traders should consider when investing in cryptocurrencies as regulations vary from country to country and even within countries themselves. It is important for investors to stay up to date on any new laws or regulations related to cryptocurrency trading so they do not get caught off guard by unexpected changes in policy that could affect their investments negatively.

Security Risk: Finally, security risk must also be considered when dealing with cryptocurrencies as there have been numerous cases of hacking attacks resulting in stolen funds over the years due to weak security protocols employed by exchanges and other platforms offering crypto services. To minimize this risk, investors should only use reputable exchanges with strong security measures such as two-factor authentication (2FA) and cold storage solutions like hardware wallets whenever possible.

Crypto trading can be a risky venture, but understanding the risks involved is key to minimizing them. By following these tips and doing your research, you can make informed decisions that will help protect your investments. Now let’s look at how to minimize those risks.

Tips for Minimizing Crypto Trading Risks

Diversifying Your Portfolio: Diversifying your portfolio is one of the most important steps you can take to minimize risk when trading crypto. By spreading out your investments across different coins, exchanges, and wallets, you reduce the chances of any single investment going sour. This way, if one coin or exchange experiences a dip in value or security breach, it won’t affect all your holdings.

Setting Stop Losses and Take Profits: Setting stop losses and take profits is another key strategy for minimizing risk while trading crypto. Stop losses are predetermined points at which traders will sell their assets to avoid further losses should the market move against them. Take profits are predetermined points at which traders will sell their assets to realize gains should the market move in their favor. Setting these limits helps ensure that investors do not get too greedy or too fearful when trading crypto and keeps them from making rash decisions based on emotion rather than logic.

Researching: Researching before investing is essential for reducing risks associated with cryptocurrency trading as well. It is important to understand how each coin works before investing so that you know what kind of returns to expect and whether it fits into your overall investment strategy. Additionally, researching an exchange prior to using it can help identify potential issues such as slow customer service response times or inadequate security measures that could put your funds at risk down the line.

By following these tips, traders can minimize their risks when trading crypto and make informed decisions. However, it is also important to be aware of common mistakes that can lead to costly losses to maximize returns on investments.

Common Mistakes to Avoid When Trading Crypto

To minimize the potential for losses, traders should avoid common mistakes such as not setting stop losses or take profits, not doing enough research, and not understanding the technology behind the currency.

Not Setting Stop Losses or Take Profits: One of the most important steps in crypto trading is to set up stop losses and take profits. A stop loss order is an automated instruction that closes out your position if it reaches a certain price level. This helps protect you from large losses if the market moves against you unexpectedly. Similarly, a take profit order will close out your position when it reaches a certain price level so that you can lock in gains before they disappear due to market volatility. Not having these orders in place could lead to major losses if prices move suddenly against your positions.

Not Doing Enough Research: Before investing in any cryptocurrency, traders should do their own research on its fundamentals and technicals to determine whether it is worth investing in at all. Without researching what factors are driving the coin’s price movements, investors may find themselves stuck with coins whose value has dropped significantly without warning due to external events outside of their control or knowledge about them beforehand.

Not Understanding The Technology Behind The Currency: Crypto assets are built on blockchain technology which is still relatively new, and complex compared to traditional financial markets like stocks and bonds where there are decades of data available for analysis by investors who understand how these markets work inside-out. As such, many crypto traders lack an understanding of how blockchains operate which makes them vulnerable when making decisions about which coins they should invest in since they do not have full insight into what’s going on under-the-hood with each asset’s underlying technology stack.

Overall, avoiding common mistakes while trading cryptocurrencies can help reduce risk exposure and increase chances for success over time through smart decision making based on thorough research and understanding of both fundamental and technical aspects related to each coin being traded.

It is important to be aware of the risks associated with crypto trading and to take steps to minimize them. By avoiding common mistakes, such as not setting stop losses or taking profits, doing adequate research, and understanding the technology behind the currency, traders can increase their chances of success when investing in cryptocurrency. Now let’s look at whether crypto is worth the risk.

Conclusion – Is Crypto Worth the Risk?

Before deciding whether to invest in crypto assets or not, it is important to understand the potential rewards and drawbacks of doing so.

Pros and Cons of Crypto Investing: Cryptocurrencies offer investors the potential for high returns due to their volatility. They are decentralized, meaning they are not subject to government regulation or manipulation by central banks. Additionally, cryptocurrencies provide users with anonymity as transactions are conducted on a peer-to-peer basis without any third-party involvement. On the other hand, cryptocurrencies are highly volatile and there is no guarantee that investments will yield positive returns over time. Furthermore, there is an inherent risk associated with investing in unregulated digital currencies since they lack legal protection from fraud or theft.

Ultimately, whether investing in cryptocurrency or not is worth the risk depends on individual circumstances and preferences. Investors should conduct thorough research before making any decisions about investing in crypto assets and consider all possible risks associated with such investments including market volatility, liquidity issues, security threats and regulatory uncertainty among others. Additionally, investors should diversify their portfolios across different asset classes to minimize losses if one particular asset fails to perform as expected. Finally, investors should set stop losses and take profits when trading cryptos so that they do not end up losing more than they initially invested due to sudden price movements caused by market speculation or news events related to specific coins/tokens.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

How To make Money With Cryptocurrencies

21 Wednesday Feb 2024

Posted by in Cryptocurrencies Trading

≈ Leave a comment

Tags

, , , ,

Over the last few years, cryptocurrencies have proven to be great investments and a trading market. And as the crypto market continues to develop and evolve, there are also new ways and strategies for retail investors to make money.

“Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong.”

Cryptocurrencies have become one of the most actively traded assets in recent years. The reasons are diverse: first, they are affordable, and you can buy millions of tokens by investing as little as $100. Another reason is that building a diversified portfolio with cryptocurrencies is easy.

While, in most cases, people simply buy and sell cryptos to speculate on price changes and generate money, there are multiple other options to make money with a cryptocurrency.

8 Best Ways to Make Money With Cryptocurrency in February 2024

1.- Investing Early in Brand New Projects at the Presale Stage

For those who can’t afford to invest in well-established crypto projects, there is an excellent alternative: the New crypto projects. As the market proliferates, more projects are introduced regularly. Not all of them are promising or legit, but if you can find the best and invest in their development’s early stages, you can make massive money from brand-new projects. Before their official launch, it is common among the new crypto projects to conduct private and public presales. During these events, their native tokens are not yet official, but the developing team offers to buy them in the presale stage at low prices once the crypto is officially launched and sent to the presale buyers’ wallets.

2.- Buying Established Crypto Coin Like Bitcoin and Holding Long-Term

Perhaps, the best and the most popular method to make money with cryptocurrency is simply investing in a well-established or promising crypto project in the long term. Established crypto projects are backed with sophisticated plans, introduce new features into the industry, and try to solve real-world problems. These cryptocurrencies are not like speculative assets, which will lose their value once the trend ends. They are quite well-established and will gradually draw attention, growing their demand. If more and more people are interested in a crypto project and invest in it, its value will increase. Consequently, you will benefit from the increased price and generate good rewards in the long term. It is incredibly profitable to invest in assets with low supply. It works perfectly with cryptocurrencies as long as they are decentralized, and no single party can decrease or increase their supply.

3.- Creating a Mixed Crypto Portfolio and Holding Mid-Term

Another great way to make money with crypto is to build a cryptocurrency portfolio that is especially useful in risk management. Building a crypto portfolio means investing in some different crypto assets, including Bitcoin, the best altcoins, and even NFTs which are an emerging asset class of their own. One of the most crucial things to consider when creating a crypto portfolio is to make it diversified. If you invest all your money in one coin, there is a higher risk of losing your capital when the asset crashes. But if you invest in multiple cryptocurrencies, you can reduce the risks of losing money even if some of your assets lose their value. If no massive crash in the market affects all the cryptos, your diversified crypto portfolio will go through minor crashes associated with two or three coins.

There are two ways of building a diversified portfolio: investing in coins with different market caps and investing in versatile crypto projects or competing projects. Classified by market capitalizations, cryptocurrencies fall into three large groups: small, mid, and large-cap. Large-cap cryptocurrencies are the most well-established cryptos: they are less risky, but the rewards are lower. In contrast, cryptos with small market caps include higher risks, and the rewards are higher too.

When selecting a crypto exchange or a platform that will fit best to build a diversified portfolio, you need to select the one that supports many crypto coins, provides diversifying tools, and is secure to hold your cryptos.

4.- Staking Crypto in an Exchange

If you have invested in cryptocurrencies that operate on the Proof of Stake blockchains, you may want to use them for extra rewards instead of keeping them idle. This process is known as staking and is one way to earn crypto using your assets for the time you will be holding them. You lock away a certain amount of your tokens for a specific time to participate in the network securing and transaction validation process. When you stake cryptocurrencies, you earn interest rates for the period you have staked them. Hence, when looking for a staking platform, you must pay attention to how much interest rates the platform pays.

Security is another top priority to consider in a staking platform if you lock your assets and need to keep them secure. Among the most popular staking platforms is OKX, and the decentralized platform Defi Swap which will support staking with high-interest rates. 

Besides staking, there is another way to generate extra money through your idle assets. It is called landing. Some decentralized cryptocurrency exchanges have a pool where users can lend tokens for a specific time, and others can borrow cryptos if needed. Those who lend tokens are granted some rewards, and the borrowers pay interest rates to them for borrowing their money. So, lending is another way to make money with crypto, where you again lock up some tokens to gain interest rates.

5.- Day Trading Cryptocurrencies

Due to their volatility, cryptocurrencies can be highly profitable even for one day. Hence, day trading is one of the most popular ways of making money with crypto. It is called day trading because you take advantage of the frequent price changes of crypto assets to open and close multiple positions during the same trading day. In this way, you make a little profit from frequent trades and can generate massive money throughout the day. However, day trading is not a straightforward process. To be able to day trade cryptocurrencies, you must have at least a basic understanding of the market and learn how to analyze crypto charts and graphs. In this way, you can understand if the value of the asset you want to benefit from will increase or decrease over time.

6.- Free Crypto Drops and Crypto Faucets

Crypto faucets and airdrops are two alternative ways to earn free crypto if you don’t want to risk your money. These methods enable you to earn cryptos without investing anything in them, but the rewards are small too. At least, you don’t put anything at risk and don’t need to develop any special skills, but you can spend some of your free time on it and earn little rewards. Airdrops are events carried out by new cryptocurrency projects during which they send a certain number of tokens to different wallets. In most cases, you will have to do interaction with their project. For example, if it is a decentralized exchange, they may airdrop cryptos to those wallets that have conducted transactions on their platforms. Even though the cryptocurrencies airdropped to your wallet may not be that valuable initially, they may increase over time. Once the cryptocurrency is officially launched, it will gain more value and even reach high prices if the project draws massive attention from investors.

Faucets are another easy way to generate small crypto rewards. These mobile apps or platforms allow you to play games or accomplish tasks and get small rewards in cryptos. Hundreds of platforms are designed for this purpose, and the tasks significantly vary from platform to platform. Sometimes, it can be extremely simple, such as solving the captchas. On our list of all the ways to make money with cryptocurrency, this is one of the easiest; however, the rewards are also small. Other platforms may require playing games and reaching a particular milestone, after which you will be rewarded. It is important to note here that money earned from faucets is relatively low, but it is the safest way of making money with crypto. Play-to-earn games are like faucets: you play and get rewarded for winning competitions or completing specific tasks. But the difference is that those rewards may be higher than with the faucets, and you will need some initial investment to access the platforms.

7.- Going All-In with Altcoins

Altcoin stands for alternative coin, and the word is coined to describe all the other cryptocurrencies created as alternatives to Bitcoin. If you think it’s already too late to invest in Bitcoin, it’s never too late to invest in altcoins. Hundreds of new altcoins are created monthly, and you have a vast selection of assets with thousands of options to purchase. New exciting altcoin projects occasionally spring up in the market, along with some well-established altcoins. These projects refer to different aspects of the DeFi ecosystem, including blockchain gaming, decentralized exchanges, programmable platforms, payment systems, etc. Investing in such promising altcoins during the early stages of their development can be a huge success for you once these projects have finished their presale stage and start to catch investors’ attention.

8.- Crypto Lotteries and Casinos

Like traditional casino and lottery platforms, cryptocurrency casinos incorporate blockchain technology with gaming and lottery elements, giving online gambling a great experience. As with traditional lottery platforms, blockchain lotteries enable you to purchase tickets and participate in competitions. When the drawn lotto numbers match with the numbers of your lottery tickets, you get rewarded from the jackpot pool. The most significant difference between traditional and blockchain-based lottery platforms is that the latter use cryptocurrencies for the ecosystem. You need to buy tickets through cryptos, and the rewards you get are in cryptos. 

Risk Disclaimer

Cryptocurrencies stand out with high volatility, meaning their prices change quite often and fluctuate extensively. On the one hand, it is advantageous if you can quickly generate high rewards. The higher the rewards, the higher the risks. This is because, in most cases, cryptocurrencies are not governed by a single authority or company. They are decentralized, and their value is influenced by the supply and demand ratio. It means that the risk of losing your money is relatively high. Even though you can make money with crypto, you can never be sure your investment will succeed. The least you can do to manage the risks is to explore the project carefully, read its white paper, and get familiar with the team behind the project and its roadmap.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

How To make Money With Cryptocurrencies

21 Wednesday Feb 2024

Posted by in Cryptocurrencies Trading

≈ Leave a comment

Tags

, , , ,

Over the last few years, cryptocurrencies have proven to be great investments and a trading market. And as the crypto market continues to develop and evolve, there are also new ways and strategies for retail investors to make money.

“Don’t invest unless you’re prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong.”

Cryptocurrencies have become one of the most actively traded assets in recent years. The reasons are diverse: first, they are affordable, and you can buy millions of tokens by investing as little as $100. Another reason is that building a diversified portfolio with cryptocurrencies is easy.

While, in most cases, people simply buy and sell cryptos to speculate on price changes and generate money, there are multiple other options to make money with a cryptocurrency.

8 Best Ways to Make Money With Cryptocurrency in February 2024

1.- Investing Early in Brand New Projects at the Presale Stage

For those who can’t afford to invest in well-established crypto projects, there is an excellent alternative: the New crypto projects. As the market proliferates, more projects are introduced regularly. Not all of them are promising or legit, but if you can find the best and invest in their development’s early stages, you can make massive money from brand-new projects. Before their official launch, it is common among the new crypto projects to conduct private and public presales. During these events, their native tokens are not yet official, but the developing team offers to buy them in the presale stage at low prices once the crypto is officially launched and sent to the presale buyers’ wallets.

2.- Buying Established Crypto Coin Like Bitcoin and Holding Long-Term

Perhaps, the best and the most popular method to make money with cryptocurrency is simply investing in a well-established or promising crypto project in the long term. Established crypto projects are backed with sophisticated plans, introduce new features into the industry, and try to solve real-world problems. These cryptocurrencies are not like speculative assets, which will lose their value once the trend ends. They are quite well-established and will gradually draw attention, growing their demand. If more and more people are interested in a crypto project and invest in it, its value will increase. Consequently, you will benefit from the increased price and generate good rewards in the long term. It is incredibly profitable to invest in assets with low supply. It works perfectly with cryptocurrencies as long as they are decentralized, and no single party can decrease or increase their supply.

3.- Creating a Mixed Crypto Portfolio and Holding Mid-Term

Another great way to make money with crypto is to build a cryptocurrency portfolio that is especially useful in risk management. Building a crypto portfolio means investing in some different crypto assets, including Bitcoin, the best altcoins, and even NFTs which are an emerging asset class of their own. One of the most crucial things to consider when creating a crypto portfolio is to make it diversified. If you invest all your money in one coin, there is a higher risk of losing your capital when the asset crashes. But if you invest in multiple cryptocurrencies, you can reduce the risks of losing money even if some of your assets lose their value. If no massive crash in the market affects all the cryptos, your diversified crypto portfolio will go through minor crashes associated with two or three coins.

There are two ways of building a diversified portfolio: investing in coins with different market caps and investing in versatile crypto projects or competing projects. Classified by market capitalizations, cryptocurrencies fall into three large groups: small, mid, and large-cap. Large-cap cryptocurrencies are the most well-established cryptos: they are less risky, but the rewards are lower. In contrast, cryptos with small market caps include higher risks, and the rewards are higher too.

When selecting a crypto exchange or a platform that will fit best to build a diversified portfolio, you need to select the one that supports many crypto coins, provides diversifying tools, and is secure to hold your cryptos.

4.- Staking Crypto in an Exchange

If you have invested in cryptocurrencies that operate on the Proof of Stake blockchains, you may want to use them for extra rewards instead of keeping them idle. This process is known as staking and is one way to earn crypto using your assets for the time you will be holding them. You lock away a certain amount of your tokens for a specific time to participate in the network securing and transaction validation process. When you stake cryptocurrencies, you earn interest rates for the period you have staked them. Hence, when looking for a staking platform, you must pay attention to how much interest rates the platform pays.

Security is another top priority to consider in a staking platform if you lock your assets and need to keep them secure. Among the most popular staking platforms is OKX, and the decentralized platform Defi Swap which will support staking with high-interest rates. 

Besides staking, there is another way to generate extra money through your idle assets. It is called landing. Some decentralized cryptocurrency exchanges have a pool where users can lend tokens for a specific time, and others can borrow cryptos if needed. Those who lend tokens are granted some rewards, and the borrowers pay interest rates to them for borrowing their money. So, lending is another way to make money with crypto, where you again lock up some tokens to gain interest rates.

5.- Day Trading Cryptocurrencies

Due to their volatility, cryptocurrencies can be highly profitable even for one day. Hence, day trading is one of the most popular ways of making money with crypto. It is called day trading because you take advantage of the frequent price changes of crypto assets to open and close multiple positions during the same trading day. In this way, you make a little profit from frequent trades and can generate massive money throughout the day. However, day trading is not a straightforward process. To be able to day trade cryptocurrencies, you must have at least a basic understanding of the market and learn how to analyze crypto charts and graphs. In this way, you can understand if the value of the asset you want to benefit from will increase or decrease over time.

6.- Free Crypto Drops and Crypto Faucets

Crypto faucets and airdrops are two alternative ways to earn free crypto if you don’t want to risk your money. These methods enable you to earn cryptos without investing anything in them, but the rewards are small too. At least, you don’t put anything at risk and don’t need to develop any special skills, but you can spend some of your free time on it and earn little rewards. Airdrops are events carried out by new cryptocurrency projects during which they send a certain number of tokens to different wallets. In most cases, you will have to do interaction with their project. For example, if it is a decentralized exchange, they may airdrop cryptos to those wallets that have conducted transactions on their platforms. Even though the cryptocurrencies airdropped to your wallet may not be that valuable initially, they may increase over time. Once the cryptocurrency is officially launched, it will gain more value and even reach high prices if the project draws massive attention from investors.

Faucets are another easy way to generate small crypto rewards. These mobile apps or platforms allow you to play games or accomplish tasks and get small rewards in cryptos. Hundreds of platforms are designed for this purpose, and the tasks significantly vary from platform to platform. Sometimes, it can be extremely simple, such as solving the captchas. On our list of all the ways to make money with cryptocurrency, this is one of the easiest; however, the rewards are also small. Other platforms may require playing games and reaching a particular milestone, after which you will be rewarded. It is important to note here that money earned from faucets is relatively low, but it is the safest way of making money with crypto. Play-to-earn games are like faucets: you play and get rewarded for winning competitions or completing specific tasks. But the difference is that those rewards may be higher than with the faucets, and you will need some initial investment to access the platforms.

7.- Going All-In with Altcoins

Altcoin stands for alternative coin, and the word is coined to describe all the other cryptocurrencies created as alternatives to Bitcoin. If you think it’s already too late to invest in Bitcoin, it’s never too late to invest in altcoins. Hundreds of new altcoins are created monthly, and you have a vast selection of assets with thousands of options to purchase. New exciting altcoin projects occasionally spring up in the market, along with some well-established altcoins. These projects refer to different aspects of the DeFi ecosystem, including blockchain gaming, decentralized exchanges, programmable platforms, payment systems, etc. Investing in such promising altcoins during the early stages of their development can be a huge success for you once these projects have finished their presale stage and start to catch investors’ attention.

8.- Crypto Lotteries and Casinos

Like traditional casino and lottery platforms, cryptocurrency casinos incorporate blockchain technology with gaming and lottery elements, giving online gambling a great experience. As with traditional lottery platforms, blockchain lotteries enable you to purchase tickets and participate in competitions. When the drawn lotto numbers match with the numbers of your lottery tickets, you get rewarded from the jackpot pool. The most significant difference between traditional and blockchain-based lottery platforms is that the latter use cryptocurrencies for the ecosystem. You need to buy tickets through cryptos, and the rewards you get are in cryptos. 

Risk Disclaimer

Cryptocurrencies stand out with high volatility, meaning their prices change quite often and fluctuate extensively. On the one hand, it is advantageous if you can quickly generate high rewards. The higher the rewards, the higher the risks. This is because, in most cases, cryptocurrencies are not governed by a single authority or company. They are decentralized, and their value is influenced by the supply and demand ratio. It means that the risk of losing your money is relatively high. Even though you can make money with crypto, you can never be sure your investment will succeed. The least you can do to manage the risks is to explore the project carefully, read its white paper, and get familiar with the team behind the project and its roadmap.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

Cryptocurrencies Trading Is a Risky Venture

19 Monday Feb 2024

Posted by in Cryptocurrencies Trading

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Cryptocurrency: Risk Or Opportunity? The Good, The Bad, & The Ugly

Cryptocurrency trading is becoming more and more popular, but with it comes risks. If you’re considering investing in crypto, understanding the potential pitfalls of cryptocurrency trading risks is essential to success.

For Financial Advisors, family offices, and investors alike, 2023 and the first months of 2024 will go down in the history books as one of the most significant with respect to cryptocurrency. Many cryptocurrencies reached all-time highs and the first ever Bitcoin ETF was approved by The SEC in the United States.

Pros & Cons of investing in Cryptocurrencies

Cryptocurrencies allow for a few positive externalities such as: offer an opportunity to gain significant return in a short time. The cryptocurrency market is constantly evolving and changing 24/7.

Due to their volatile nature prices can fluctuate significantly over short periods making it difficult for even experienced traders to predict where prices will go next, meaning profits could easily turn into losses if not managed properly. Secondly, because most exchanges operate outside government regulation there is always a risk that funds may be lost through hacking attacks or fraudsters taking advantage of unsuspecting users who do not know how best to protect themselves online. Finally, some countries may impose taxes on profits made from crypto investments, so it is important for individuals living in those jurisdictions to understand what their obligations are beforehand, so they do not get caught out later down the line.

Cryptocurrency trading is an exciting way to invest in digital assets, but it comes with certain risks that should be considered.

Cryptocurrency trading can be a lucrative venture, but it is important to understand the risks associated with this type of investment. Volatility risk is one of the most significant risks when trading cryptocurrencies. Cryptocurrencies are known for their high volatility and prices can change drastically in a short period of time. This means that traders need to be prepared for sudden price changes and have strategies in place to manage them effectively.

Liquidity risk is another major concern when trading cryptocurrencies. Liquidity refers to how easily an asset can be bought or sold without affecting its price significantly. Low liquidity means that it may take longer to buy or sell large amounts of cryptocurrency, which could lead to losses if the market moves against you before your order has been filled.

Regulatory risk is also something that traders should consider when investing in cryptocurrencies as regulations vary from country to country and even within countries themselves. It’s important for investors to stay up to date on any new laws or regulations related to cryptocurrency trading so they don’t get caught off guard by unexpected changes in policy that could affect their investments negatively.

Finally, security risk must also be considered when dealing with cryptocurrencies as there have been numerous cases of hacking attacks resulting in stolen funds over the years due to weak security protocols employed by exchanges and other platforms offering crypto services. To minimize this risk, investors should only use reputable exchanges with strong security measures such as two-factor authentication (2FA) and cold storage solutions like hardware wallets whenever possible.

Crypto trading can be a risky venture, but understanding the risks involved is key to minimizing them. By following these tips and doing your research, you can make informed decisions that will help protect your investments. Now let’s look at how to minimize those risks.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

Cryptocurrencies Trading Is a Risky Venture

19 Monday Feb 2024

Posted by in Cryptocurrencies Trading

≈ Leave a comment

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Cryptocurrency: Risk Or Opportunity? The Good, The Bad, & The Ugly

Cryptocurrency trading is becoming more and more popular, but with it comes risks. If you’re considering investing in crypto, understanding the potential pitfalls of cryptocurrency trading risks is essential to success.

For Financial Advisors, family offices, and investors alike, 2023 and the first months of 2024 will go down in the history books as one of the most significant with respect to cryptocurrency. Many cryptocurrencies reached all-time highs and the first ever Bitcoin ETF was approved by The SEC in the United States.

Pros & Cons of investing in Cryptocurrencies

Cryptocurrencies allow for a few positive externalities such as: offer an opportunity to gain significant return in a short time. The cryptocurrency market is constantly evolving and changing 24/7.

Due to their volatile nature prices can fluctuate significantly over short periods making it difficult for even experienced traders to predict where prices will go next, meaning profits could easily turn into losses if not managed properly. Secondly, because most exchanges operate outside government regulation there is always a risk that funds may be lost through hacking attacks or fraudsters taking advantage of unsuspecting users who do not know how best to protect themselves online. Finally, some countries may impose taxes on profits made from crypto investments, so it is important for individuals living in those jurisdictions to understand what their obligations are beforehand, so they do not get caught out later down the line.

Cryptocurrency trading is an exciting way to invest in digital assets, but it comes with certain risks that should be considered.

Cryptocurrency trading can be a lucrative venture, but it is important to understand the risks associated with this type of investment. Volatility risk is one of the most significant risks when trading cryptocurrencies. Cryptocurrencies are known for their high volatility and prices can change drastically in a short period of time. This means that traders need to be prepared for sudden price changes and have strategies in place to manage them effectively.

Liquidity risk is another major concern when trading cryptocurrencies. Liquidity refers to how easily an asset can be bought or sold without affecting its price significantly. Low liquidity means that it may take longer to buy or sell large amounts of cryptocurrency, which could lead to losses if the market moves against you before your order has been filled.

Regulatory risk is also something that traders should consider when investing in cryptocurrencies as regulations vary from country to country and even within countries themselves. It’s important for investors to stay up to date on any new laws or regulations related to cryptocurrency trading so they don’t get caught off guard by unexpected changes in policy that could affect their investments negatively.

Finally, security risk must also be considered when dealing with cryptocurrencies as there have been numerous cases of hacking attacks resulting in stolen funds over the years due to weak security protocols employed by exchanges and other platforms offering crypto services. To minimize this risk, investors should only use reputable exchanges with strong security measures such as two-factor authentication (2FA) and cold storage solutions like hardware wallets whenever possible.

Crypto trading can be a risky venture, but understanding the risks involved is key to minimizing them. By following these tips and doing your research, you can make informed decisions that will help protect your investments. Now let’s look at how to minimize those risks.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

Cryptoassets Trading Risk Overview

17 Wednesday Jan 2024

Posted by in Cryptocurrencies Trading

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Cryptoassets vary in their characteristics and risks. Before buying, ensure you understand the specific risks. Do not invest unless you are prepared to lose all the money you invest. This is a high-risk investment, and you should not expect to be protected if something goes wrong.

General risks common to all crypto assets

What are the risks associated with Cryptoassets generally?

  • Volatility and Liquidity Risks: Cryptoassets are known for their high volatility which refers to rapid and significant price fluctuations that may be experienced over short periods of time. Cryptoassets markets are often driven by speculation and sentiment leading to rapid price movements based on market perceptions, positive or negative, based on news and rumours. It is essential to consider your individual risk tolerance and investment goals before engaging with Cryptoassets. During periods of high volatility, you may be unable to buy or sell any Cryptoassets.
  • Nascent Technology: Blockchain technology remains in its early stages and the underlying technology continues to evolve. Technical issues, security breaches, and vulnerabilities of the underlying protocol can trigger price fluctuations. It is unclear whether the economic value or functional elements of Cryptoassets will persist over time. Additionally, the Cryptoassets ecosystem is rapidly developing in a competitive market, demand for any Cryptoassets may decrease with the entrance of a competitor or simply the inability to establish long-term value.
  • Hacks: Exploitable vulnerabilities are often discovered in the source code of Cryptoassets, resulting in various issues such as impaired functionality, compromised user information, and theft of Cryptoassets. Additionally, the cryptographic foundations of any Cryptoassets may prove to be flawed or inadequate over time.
  • Concentration Risks: Depending on the consensus mechanism used by a particular blockchain, If an individual or entity acquires control of more than 51% of the computing power (hash rate) utilised by a blockchain network, they would possess the ability to exploit this majority control to engage in double spending of their Cryptoassets. This is known as a “51% attack”, and, if successful, it would severely undermine confidence in public blockchain networks such as Bitcoin or Ethereum or any impacted blockchain network. Consequently, the value of the Cryptoassets impacted would likely experience a significant decline.
  • Stablecoins: Stablecoins are coins are designed to maintain a fixed value relative to the denominated fiat currency. There is no assurance that a stablecoin is able to maintain its value fixed to any denominated currency in moments of extreme volatility.
  • Internet and Electronic Trading Risks: Utilising an internet-based trade execution software application entails certain risks, including but not limited to potential hardware and software failures. For instance, in the event of an internet connection or equipment failure, you may encounter difficulties such as being unable to place an order, experiencing order execution deviations from your instructions, or the non-execution of your order altogether. Consequently, this may result in financial losses if the market for a specific Cryptoassets experiences a sudden drop.
  • User Error: Once a Cryptoassets transaction has been executed to its respective network, or if the user sends their Cryptoassets to an incorrect wallet or network, there is no possibility to reverse the transaction. In the unfortunate event of fraudulent or accidental transactions, any resulting losses are not recoverable.
  • Cyber Security: Cryptoassets platforms have faced cyberattacks and encountered technical problems that led to the loss or theft of Cryptoassets belonging to their users. Consequently, a similarly targeted cyberattack could potentially result in the theft or loss of your fiat currency or Cryptoassets. In such circumstances, it might be challenging or even impossible to recover the lost funds or assets.
  • Regulatory Risks: Legislative and regulatory changes or actions at the national or international level may adversely affect the use, transfer, exchange, and value of crypto assets.
  • No Investor Protection: On some exchange platforms, Cryptoassets do not benefit from the protection provided by the Financial Ombudsman Service (FOS), or the Financial Services Compensation Scheme (FSCS) if something goes wrong. You should be aware and prepared to potentially lose some of all of your money.

Stablecoins

What are they?

A stablecoin is a cryptocurrency whose value is pegged to that of an underlying fiat currency, such as the Pound Sterling, US Dollar, or Euro.

What are the risks associated with Stablecoins?

  • Counterparty Risk: These assets are backed by collateral (e.g., fiat currency), and relying on a third party to maintain the collateral introduces risk. This risk emerges if the party faces insolvency or fails to maintain the required collateral.
  • Redemption Risk: When an asset claims redeemability for underlying collateral, there is a risk that the redemption process will not unfold as expected. This risk is particularly evident during periods of market volatility or operational challenges.
  • Collateral Risk: The stability of the asset is subject to the risk that the value of the collateral, which may be another type(s) of asset or Cryptoassets(s), may decline or become volatile.
  • FX Risk: Many Stablecoins are denominated in US dollars, exposing you to fluctuations in the exchange rate between USD and other fiat currencies.
  • Algorithm Risk: If the asset relies on an algorithm to maintain stability (e.g., by adjusting supply based on demand), there is a risk that the algorithm will fail or behave unexpectedly. This scenario could cause the asset to lose its stability and even its entire value.

Meme Coins

Meme coins, derive value from community interest and online trends, often without any intrinsic value or utility.

What are the risks associated with Meme coins?

  • Volatility Risk: Meme coins are prone to substantial and unpredictable price changes, often experiencing rapid fluctuations. Social media trends and celebrity endorsements can significantly influence their value, diverging from traditional investment fundamentals.
  • Lack of Utility: Meme coins can sometimes lack intrinsic value or utility, relying more on community interest, online trends, and speculative trading to determine their worth.
  • Market Manipulation: Meme coins face an elevated risk of market manipulation, including “pump-and-dump” schemes, where prices are artificially inflated before a sudden crash.
  • Lack of Transparency: Information about meme coins, such as details about development teams, goals, and financials, is often limited. This lack of transparency poses challenges in evaluating the credibility and potential of a meme coin accurately.
  • Emotional Investing: Meme coins often evoke intense emotional reactions from investors, leading to impulsive decisions. This emotional trading activity has the potential to magnify losses in the market.

Defi tokens

Decentralised Finance (DeFi) tokens, such as UNI and AAVE, are linked to financial applications and protocols on decentralised blockchains.

What are the risks associated with Defi tokens?

  • Smart Contract Risk: DeFi’s reliance on smart contracts exposes it to risks. Even a minor coding error or oversight could lead to the exploitation of a contract, potentially resulting in significant losses for DeFi tokens.
  • Regulatory Risk: Operating in a decentralised manner, DeFi often lacks intermediaries or financial crime controls. Regulatory bodies across jurisdictions might introduce new regulations, affecting the use, value, or legality of certain DeFi protocols or assets.
  • Rug-Pulls/Exit Scams: Some DeFi projects, initiated by anonymous or pseudonymous teams, heighten the risk of “rug pulls.” In such cases, developers abandon the project, withdrawing funds and leaving investors with worthless tokens.
  • Data/Oracle Risk: DeFi protocols often rely on external data sources or “oracles”. Manipulation or inaccuracies in these data sources can lead to unintended financial outcomes within the protocols.
  • Protocol Complexity: The intricate nature of some DeFi protocols can pose challenges for average users to fully comprehend the mechanisms and associated risks.
  • Lack of Liquidity: Certain coins within DeFi exhibit very low liquidity, meaning slight changes in supply and demand can result in sharp price movements.

Cryptoassets Risk Summary

Cryptoassets also referred to as cryptocurrency, are a digital representation of value that function as a medium of exchange, a unit of account, or a store of value. Cryptoassets are not legal tender, are not backed by the government or a central bank and generally have no underlying assets, revenue stream, or other sources of value tied to fiat currency or other assets.

Their value is derived from market dynamics and has historically been more volatile relative to fiat currency and other assets. The unpredictability of the price of cryptocurrency relative to fiat currency may result in significant loss over a short period of time.

The value of Cryptoassets may be derived from the continued willingness of market participants to exchange fiat currency for cryptocurrency, which may result in the potential for permanent and total loss of value of a particular cryptocurrency should the market for that cryptocurrency disappear. In certain cases, it may be difficult or impossible to liquidate a position quickly at a reasonable price due to various market factors, including illiquidity or actions by trading facilities.

Legislative and regulatory changes or actions at the national or international level may adversely affect the use, transfer, exchange, and value of cryptocurrencies. Several federal agencies have also published advisory documents surrounding the risks of virtual currency.

Some Cryptoassets transactions shall be deemed to be made when recorded on a public ledger, which is not necessarily the date or time that the customer initiates the transaction. Cryptoassets ownership is often determined by a decentralised public ledger that associates an amount of cryptocurrency with a unique address defined by a public cryptographic key.

A private cryptographic key is required to transfer cryptocurrency from one address to another. Anyone with access to the private key associated with the address can transfer the associated cryptocurrency. Cryptoassets transfers generally cannot be cancelled or reversed and the identity of the holder of the private key associated with any address can be difficult, if not impossible, to ascertain.

The nature of Cryptoassets may lead to an increased risk of fraud or cyber-attack. If you are using cryptocurrencies to purchase goods or services, most exchange platforms have no visibility into the sellers and cannot control delivery, quality, safety, or legality. Losses due to fraudulent or accidental transactions may not be recoverable.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Business &Corporate Strategist

Systemic Strategic Planning

Quality Assurance, Occupational Health & Safety, Environmental Protection, Regulatory Compliance, Crisis & Reputation Management

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

Cryptocurrencies: The Largest Casino on Earth

10 Wednesday Jan 2024

Posted by in Cryptocurrencies Trading

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Imagine yourself at a Las Vegas casino. The person next to you bets $1,000 at roulette. A moment later, the ball lands on red and the gambler doubles his money.

When it comes to a casino, we all know that Roulette is a game of luck. No skill is involved. But when it comes to stocks, crypto, or anything that appears to have slightly more legitimacy than a roulette wheel, we call predictions “right” or “wrong”, this even though the short-term direction of securities prices cannot be determined on any logical basis. They cannot be! This is not even debatable: this is fact!

Do not be like so many people that acknowledge the fact that Roulette is a game of luck and cannot get it into their head when it comes to stocks or cryptos. The reality is that all data shows that the short-term direction of a bond, a stock, currency, or market is unknowable. The only thing knowable is whether the stock is an equity stake in a quality company selling at a reasonable price. This can only be determined by looking at the underlying fundamental financials of the company as shown on the profit statement, cash-flow statement, and balance sheet. And this can only lead to predicting a reasonable price appreciation over long-term business cycles of at least 3–5 years. Anything else is noise and nonsense.

The key to successful investing is to know what you cannot know.

People think the job of a financial professional or analyst is to guess the direction of prices, state that publicly, trade accordingly, and then win or lose. There is no successful investor in the history of investing who has ever employed this method. This dubious “strategy” is most likely to result in complete and utter failure. This is called gambling. This is called speculation.

One of the most successful investors of the world, not to say the greatest, with an audited track records to prove it, Warren Buffett has always followed a different approach: a selection of stocks not based on trying to predict the direction of blips on a screen but rather fundamental elements like cash-flow growth over long periods of time.

The difference between being an investor, a gambler and a speculator is the difference between being successful over time and being successful for a lucky moment. There is a fundamental difference between gambling/speculating and investing: gambling and speculating are just short-term in nature, while investing looks at a longer time horizon. Gambling/speculating, and investing are entirely different acts, borne of entirely different philosophies, and inspired by entirely different underlying mental analyses.

Though nothing can ever be guaranteed, the value investor knows that companies that generate cash have expected returns that can be reasonably predicted. The value investor still makes mistakes, and nearly always forgoes the most glamorous, flashy, and trendy investments. But the value investor’s concentration on measurable cash flows and the price paid for them renders it the only strategy that respects economics over time. And the only strategy that should be used to plan a retirement.

The worst reason to buy something is that it just went up. The second-worst reason to buy something is that it just went down. The third-worst reason to buy something is because someone that you do not even know says you should buy it. On the contrary, the only good reason to buy something is because it is a quality asset that is undervalued, a determination that can only, only be made by looking at the underlying financial statements.

Most people quickly forget how awful it is when momentum/growth strategies fail. Your investment collapse 67% and the rise back 68%. You may think your mojo is back… until you realize that a 67% loss followed by a 68% gain still leaves you 45% below your starting point. This is the math of reverse compounding. Let’s look at it in dollars: Your $100 investment collapses to $33 after a 67% loss but returns to just $55after a 68% recovery; his is only half its starting value. This is one of the problems with growth/momentum investing. It looks great during short, selected time periods, but due to the astonishing losses it endures, its long-term track records are typically poor.

Growth/momentum investing is based on the principle of buying new and innovative companies that look like they can establish dominance over time. But the problem is that paying too much for any asset, no matter how disruptive, ascendent, or pioneering, is a recipe for eventual failure, even if it leads to huge gains in the short-term. At least growth investing tends to look at stocks as businesses. And this makes it far superior to pure speculation of the type which tries to predict macroeconomic conditions, markets, or the short-term direction of securities prices.

Perhaps the worst type of speculation occurs around assets whose value is derived not from the underlying cash flows but from reasons of scarcity. This would include things like crypto, commodities, and raw currencies. Not one of these things produces cash. In each case it can be traded for cash, but it cannot produce cash. This creates two problems: First, they cannot be valued, because only producers of cash can be valued based on their yield. And second, since they have no yield, you do not get paid to wait.

When Bitcoin was trading all the way up to $69,000. Many people were wondering if Bitcoin’s value was over evaluated. When it dropped from $69,000 to $17,000, the questions about Bitcoin quickly stopped. But now that it is returned to $43,000, interest is once again percolating. I do not forgo Bitcoin because I think it will collapse, or because I believe it is overvalued, or because it will not go mainstream as a reserve currency. It probably will. I do not buy Bitcoin because it produces no cash and cannot be valued, and therefore to purchase it is an exercise in pure speculation, not investing. This is wholly intrinsic to my investment philosophy. The only way to generate cash with cryptocurrencies is to buy long and sell short during a very short period of times. I am talking minutes, even seconds and, you are better making sure to know what you are doing.

In the best possible circumstances and the best possible scenario, cryptocurrencies trading would generate a possible 20% to 25% interest on your short-term gambling/investment. Is this worth it? Let’s look at in in dollars: at 20%, $100 will bring you $20; $10000 will bring you $2,000; $100,000 will bring you $20,000. Is this worth it? Only if you are right 100% of the time and if you have the capital to go large. Cryptocurrencies are only gambling and speculation; nothing else, whatever you may hear, read, or see.

What is reassuring about value investing is not that it is always right, or that it always works in the short term, or that it leads one to get rich quick. It does not. It is that it harnesses economic reality to make sure that every dollar is working for the investor at every minute of the day so that the investor can get rich slowly. And that is much better than getting poor quickly which is what most speculators do in the end.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Personal & Corporate Fixer

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

Uphold Review 2024

05 Friday Jan 2024

Posted by in Canadian Cryptocurrencies, Cryptocurrencies Trading

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Pros

  • Wide range of cryptocurrencies
  • Trade stocks and precious metals
  • Swap crypto for stocks or metal in seconds
  • Recurring buy/sell orders
  • Educational resources
  • 50 simultaneous Limit orders allowed
  • Free debit card purchases 

Cons

  • High spreads
  • Uphold debit card not available to Canadians
  • Bank deposits/withdrawals not available for Canadians 
  • 3.99% credit card processing fee
  • Lack of search filters for equities

Released in 2015, Uphold is the best crypto exchange for multi-asset trading in Canada. Not only can you trade 60+ popular digital currencies but you can also trade US stocks or precious metals. This is why many Canadian crypto investors prefer Uphold over others.

Uphold is a versatile cryptocurrency exchange, offering a unique range of deposit methods including credit/debit cards, direct cryptocurrency deposits, equities, and even precious metals. This exchange supports multiple currencies such as Canadian dollars (CAD), USD, and Euros, making it accessible for a global user base.

Designed with beginners in mind, Uphold provides an easy-to-navigate interface and a diverse asset portfolio. Users can trade from over 65 cryptocurrencies, invest in more than 50 US stocks, and deal with 4 different precious metals.

In terms of fees, the platform maintains a 1.8% spread on most cryptocurrency trades, a competitive 1% spread on equities, and a 3% spread on metal trades. Notably, debit card purchases on Uphold are free of charge. While the spreads are quite high at 1.8% for Canadians, we still think Uphold is one of the best crypto exchanges for Canadians because debit card purchases are free. If your bank allows the transaction, you can buy crypto from Uphold without additional card charges. You can manage all your assets on the desktop trading platform or on Uphold’s mobile app.

With Uphold’s “Anything to Anything” function, you can trade crypto to crypto, or trade crypto for a US stock, or a precious metal, in a few clicks. Not only that but you can place up to 50 simultaneous limit orders without putting up capital for each order. No other Canadian cryptocurrency exchange allows this many limit orders at once, so we think that makes Uphold one of the best crypto exchanges in Canada.

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Personal & Corporate Fixer

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.

Shakepay Review 2024

05 Friday Jan 2024

Posted by in Canadian Cryptocurrencies, Cryptocurrencies Trading

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Shakepay is a Montreal-based trustworthy Canadian exchange that offers free and fast deposits and withdrawals and is considered one of the best Canadian crypto exchanges for beginners. You can deposit Canadian dollars (CAD) via Interac e-Transfer or wire transfer. Verification can be instant meaning you can start depositing and trading right away.

Shakepay is fast, beginner-friendly, and has a modern interface.

Shakepay offers two coins only: Bitcoin and Ethereum.

Shakepay stands out for its free deposits and withdrawals, a feature that can be particularly attractive for users. However, it is important to note that the exchange has a relatively high spread, ranging from 1.2% to 2.5%. This spread, which is the difference between the buying and selling prices, can significantly impact the cost of transactions, making trading fees on the higher side.

Shakepay does not offer advanced trading tools because it is aimed at new crypto users and those looking for a simple, easy-to-use experience.

Pros

  • Fast and free deposits and withdrawals
  • Unique referral program
  • Responsive customer support
  • A highly rated app
  • Beginner-friendly interface

Cons

  • Only accepts CAD deposits.
  • Manual verification can take seven days.
  • Only Bitcoin and Ethereum are available.
  • High spread

Michel Ouellette JMD, ll.l., ll.m.

JMD Live Online Subscription link.

J. Michael Dennis, ll.l., ll.m.

Personal & Corporate Fixer

Skype: jmdlive

Email: jmdlive@jmichaeldennis.live

Web: https://www.jmichaeldennis.live

Phone: 24/7 Emergency Access

Available to our clients/business partners

Disclaimer: All write-ups and articles do not constitute financial and legal advice in any way whatsoever but for information purposes only.

When making financial and legal decisions and commitments, we strongly recommend you consult your professional financial and legal services provider. Our website uses referral links to various crypto exchanges as a means of monetization. We appreciate it if you choose to use the in-article links, but the decision is ultimately yours.