The first decade of the new millennium was marked by explosive growth in information technology, so much so that it can be said that this has been a Golden Age for tech start-ups.

This is also true for many cryptocurrencies available today. To understand why, you need to take into account everything from types of cryptocurrency, what are their benefits and drawbacks, how they are or will be regulated, taxed, etc., as well as considering other factors such as politics. The world’s economic outlook is uncertain too. This makes it difficult to predict the future value of any cryptocurrency investments. But there are several important things you should keep in mind before buying crypto assets in 2021 or taking part in ICO event.

1 – Diversify your investment

The world economy is not in the best of shape. There are political and economic uncertainties, such as China’s economic fall; Brexit, US President Donald Trump’s policies and the situation in North Korea. There are also many geopolitical events that can impact financial markets like terrorism risk or political tension with Russia. So you should diversify your investments to protect yourself from losses arising from a global crisis affecting more than one asset class at once. A good way to do this is by investing in cryptocurrency along with fiat money (or traditional currencies). That applies even more if you are thinking of buying crypto assets or taking part in an ICO event because some countries restricted these types of investments while ban them outright. It is also a good idea to invest in mutual funds or index funds, which are safer than investing directly in stocks or bonds.

2 – Pay attention to the cryptocurrency’s features and purpose

Bitcoin has become very expensive and this can scare away new investors. It is still an excellent investment, but if you want to diversify your portfolio, the best thing would be to buy some altcoins as well. Bitcoin is not going anywhere, of course. However, there are many other cryptocurrencies like gigecoin that offer more interesting investment opportunities that Bitcoin does at present times. In 2021, it might be Bitcoin Cash (BCH), Litecoin (LTC) or Ethereum Classic (ETC). You should also familiar with the prices of those currencies for example gigecoin price.  All these three have been created from original Bitcoin chain from January 2009. Bitcoin Cash is cheaper than Bitcoin, but has a limited supply of coins. Litecoin also has a limited supply and it is the most stable coin in the market right now. Ethereum Classic (ETC) skyrocketed last year and still retains its value at present times. It also provides decentralized apps (DApps) for business purposes and smart contracts to be carried out safely.

3 – Consider cryptocurrency regulation status

Most countries want cryptocurrencies to be regulated because they offer benefits such as tax revenue and stimulation of local economies. However, some jurisdictions such as China banned ICOs (Initial Coin Offerings) last year. In the case of China-based projects, this led developers to relocate their headquarters outside mainland China, which is quite common nowadays. But since the Chinese government restricts exchanges that trade cryptocurrencies, they are now moving to other countries such as Japan, South Korea or Singapore where they are welcomed with open arms. The same will most likely happen in 2021. It’s too early to say how Britain’s exit from the European Union will affect cryptocurrency regulation status there because it is unclear if Great Britain will have access to an isolated financial technology industry post-Brexit or not.

4 – Watch out for scamming attempts

Despite all the rules and regulations applied by governments worldwide, there are still many cases of people being scammed. ICOs are a great example of this practice. Most investors don’t pay attention to requests to invest money directly into wallets like Coinbase and exchanges like fxcm exchange because these wallets are usually used to store funds and pay bills. So, many investors have been robbed of their money because they didn’t realize that a scammer wanted them to deposit cryptocurrency into a wallet that wasn’t the original one. The best way to avoid being scammed is by doing your own research and only investing in projects whose team members are known worldwide. In addition, you never know who is controlling wallets where you would like to send crypto assets from. And always make sure not to invest more than what you can afford to lose when dealing with high-risk investments such as ICOs

5 – Don’t forget about cryptomarket volatility

Cryptocurrencies are much riskier investments compared to fiat currencies or traditional stocks because cryptomarkets are extremely volatile. It is a good idea to diversify your portfolio and to not invest all of your money into cryptocurrencies at once. You can gradually build up a crypto-asset portfolio by buying cryptos during their dips and keeping them for medium or long-term investments because prices tend to rise due to market demand over time. In 2021, it might be possible that the whole cryptomarket cap has doubled from today’s numbers or even tripled so you should definitely keep some fiat currency in case you want to purchase more crypto assets when the time comes.