Investing in Blockchain Technology: Some Handy Tips and Tricks

Investing in Blockchain Technology: Some Handy Tips and Tricks

Blockchain technology has seen more and more investment in recent years, and if you want to invest in blockchain technology, read on. In this post, we’ll take you through some of the handiest tips and tricks that will help you get the best out of your investment in blockchain technology.

But first, let’s talk about what blockchain really is.

Blockchain: What is it?

If you’re new to the term blockchain, you need to first understand what it is. In simple terms, blockchain records “blocks” of transaction information and keeps the information secure in what technically is a digital public ledger. Individual “blocks” are verified, given unique identities, and finally added to the ledger. Cryptocurrencies use this technology as well, with every new block creating a new “coin” of cryptocurrency.

Blockchain technology’s use goes beyond cryptocurrencies. It is also a technology that helps organizations with decentralized and complex systems to enhance their operations. Starbucks and Walmart are two of the most well-known non-cryptocurrency entities to use this technology. While Starbucks relies on blockchain technology to improve pricing transparency, Walmart uses the technology to isolate potential foodborne illness outbreaks.

Blockchain investing

Tips to Invest in Blockchain

Now that you know what blockchain technology is all about, let’s take a look at some blockchain investment tips. The tips we’ll share with you here are mostly from a cryptocurrency standpoint.

So if you’re interested in purchasing cryptocurrencies such as Bitcoin or Ethereum, read on.

1. Bitcoin Stockpiling

Bitcoin stockpiling is quite similar to gold stockpiling. The only major difference is that gold is tangible, whereas Bitcoins and other cryptocurrencies are not. However, in terms of the fundamental investment principles, there’s not much difference.

Both gold and Bitcoins are considered finite and rare. Unlike the early days of Bitcoin, when the generation rate of the cryptocurrency was fast, now, the generation rate is extremely slow. This is the result of the number of Bitcoins reaching the 21 million coin built-in limit.

Today, Bitcoin prices work on the economic laws of demand and supply. To stockpile Bitcoins, you can either trade Bitcoins directly, or make use of indirect investment options.

2. Be Diligent

While Bitcoin stockpiling offers a great way to invest in blockchain technology, you should make a conscious effort to know what you’re getting into. Sure, there are still a lot of question marks over the legitimacy of cryptocurrency trading. However, you can find some excellent resources that will help you understand the potential of future investments.

From resources like this, you can get a ton of information about a particular cryptocurrency such as how the currency makes money and how it operates. The point of being diligent is to avoid risky investments where losses are way more likely than gains.

3. Crowdfunding

Crowdfunding using alternative coins has become a popular mainstream option for investing in blockchain technology. Crowdfunding involves selling a pre-mined coin supply in an ICO or initial coin offering.

A lot of apps and services that have raised funding have counted on crowdfunding. Through this method, investors can purchase cryptocurrency coins and expect the prices to increase based on the popularity of the service.


4. Pure Blockchain Technology Play

IBM and Intel are among the heavyweights that are making serious investments in blockchain technology. Their investments are not only about cryptocurrencies – they’re also about helping different industries use the technology to improve their existing products and/or services.

There are also certain companies that are investing purely on cryptocurrencies. You can invest in the stocks issued by these companies, but if you want to keep the risks limited, we’d recommend investing in stocks issued by major companies that aren’t exclusively dealing in cryptocurrencies.

While there are some other ways to invest in blockchain technology, we handpicked these as they are regarded as the safest investment options. You could also buy blockchain ETFs. These funds are known for investing in shares of organizations and companies that are exposed to blockchain technology in one way or another.

So, we hope that you can take the next step forward in blockchain investing after reading this post. All the best!

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