How much should I invest in cryptocurrency as a beginner?

 Since Bitcoin started in 2009, the cryptocurrency market has grown exponentially. Today there are over 1,500 tradable coins on the market, with new coins being created every day.

It's never been a better time to invest in cryptocurrency and one of the most common questions beginners have is how much should I invest?

But just as people's responses to "How do you make money?" can vary greatly, so can their approach to investing in cryptocurrency.

What most people do agree on, is that you should invest only a portion of your savings in cryptocurrency. While the market has grown exponentially, it still carries significant risks and each person should determine exactly how much money they are comfortable investing.

The Future of Cryptocurrency

For many people, cryptocurrency is a way to enjoy the benefits of a free financial system - one that is not reliant on banks or government.

Mt Gox, the first major Bitcoin exchange, went offline in 2014, losing more than $400 million in customer funds. This led some governments to ban cryptocurrency exchanges within their borders and others to consider doing so. In 2018, a South Korean cryptocurrency exchange was hacked and lost over $40 million worth of investor funds.

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These events took place even as the value of Bitcoin rose to record highs.

While cryptocurrency markets are still in their infancy, they are maturing fast. Ethereum was launched in 2015 and it has since grown to become one of the most popular cryptocurrency networks, with a market capitalization over $50 billion. If you had invested $100 USD in Ethereum back in 2013, you would have more than a million dollars today.

Many experts predict that by 2027, cryptocurrency markets will be worth over half a trillion dollars.

How Much Should I Invest When Starting Out?

When starting out with cryptocurrency, most experts recommend investing only a small portion of your savings. This can be $300 or $3,000 (or whatever amount you are comfortable with). It's important to remember that this is not a decision you can take lightly. Cryptocurrency markets can tank just as easily as they can grow and there is no government or bank to step in and save you if something goes wrong.

You should set a budget that you can comfortably afford to lose. If the market takes a turn for the worse, you have no one to blame but yourself.

There are many experts who recommend spreading your investment over time and diversifying into as many cryptocurrencies as possible. Doing this will increase the risk of losing your entire investment, but in most cases it will yield better returns.