Written by André van der Merwe, Aug 2020
Take note: On this blog we share stuff that we are excited and enthusiastic about. Just like you do not drink your grandma’s medication just because she’s doing it, you shouldn’t do something just because we are doing it. If you were wondering, no, we are not financial advisors and none of the content should be seen as financial or investment advice. Now that you have read that, please apply your mind, this is after all the internet where anyone can write anything and only some of it is beneficial. You are a free agent so grow your knowledge and learn to discern.
Since it is Woman’s month, I would like to pay my respects to two woman who knows how to bake a birthday cake. My mom and my wife…
One of my fondest childhood memories is waking up on a birthday morning and smelling freshly baked cake. The aroma told the whole house that today was a day to celebrate. Today was a day to be together as a family. Today we will have our cake and eat it…
Lucky for me, I married a wife who also loves to bake cake for birthdays. I do not know of any other person who makes such an effort to ensure that birthdays are a memorable occasion. The birthday cake is usually the centre piece for these celebratory days.
It was only after I got married that I would join my wife in the baking process. I soon realized that there is a heck of a lot of planning that goes into backing a cake. They do not just magically appear on birthdays. My wife had learnt a lot of patience with me “helping” in the baking process because I do not always measure as precise. I never knew it took so much strategy and planning to execute the perfect birthday cake. I always loved enjoying the end-result, but I never knew the process would ask a lot of effort at times. There is a great sense of satisfaction though to see everything coming together.
How to bake a Crypto cake
To bake a birthday cake, you need the right recipe, the right utensils, the right amount of heat and a suitable occasion. The same applies when baking a Crypto cake.
The right recipe
When my wife bakes a cake, she does not add equal amounts of everything into the mixture. That would be disastrous. There are one or two ingredients which dominates the cake mixture and it forms a base for the rest of the ingredients to attach to. The same applies to understanding the world of Crypto as well. There are roughly 5000 different Cryptocurrencies in existence today. That is a lot to choose from! BTC is the oldest form of digital asset and since its creation about 12 years ago, many other coins have been born. All these coins are referred to as “Altcoins”.
It would be good to consider Bitcoin and some of the earlier coins with a proven track record as your base with which you make your Crypto cake. Then, do some homework on what is going on in the markets. Do not listen to your best friend who found the latest and greatest altcoin which promises massive returns in a short run. It does occasionally happen that new coins gain traction in their start-up phase, but we have seen many of them plummet soon after emerging into the markets. Most coins that are in their *ICO (Initial Coin Offering) phase are cheap to get which makes it very attractive for would-be buyers and newbies to the Crypto world, but you must do your due diligence before buying these coins – it could cause your Crypto cake to be a complete flop.
There are reputable sources that you can follow or learn from that will help you find which ingredients are currently good to consider for your Crypto cake. At Cryptovate we have found that this link gives great insight when it comes to the more established coins as well as which of the altcoins to consider. It is crucial to find the right balance when buying different Cryptocurrencies. This also helps you to diversify your Crypto portfolio which can benefit you if markets take an unexpected turn.
The right utensils
When my wife and I would bake a cake, I found that there are some utensils that I love working with and others I loathe. A part of the mixture of the cake will need an automatic electric mixer, while some parts of the process involve more manual labour. I like working with the automatic electronic mixer, while my wife loves to mix the icing manually.
The same applies to baking your Crypto cake. There are some parts of the process that you can automate, and some part need manual input. Once you have decided on your “mixture” of Cryptocurrencies, the next step is to see what parts of this process can run on automation and which parts do you want to tackle with a hands-on approach. The wonderful part of automation is that you do not need to have much knowledge of trading at all. The trading is done for you and you benefit from daily gains. Your Crypto cake grows without too much effort from your side. This approach does come with risks though. If you entrust your Crypto portfolio to someone or some organization which is not reputable, you stand a chance to lose a lot of money. At Cryptovate we have some recommendations when it comes to automating your Crypto trading.
The manual side of baking your Crypto cake has to do with you pressing the buttons for the trading to happen. Many people prefer this option because it enables you to make the executive decisions about your money. The problem with the manual side of things is the lack of knowledge. We do not always have the time to learn all the tricks of the trade (pun intended). Learning how to trade is an art. Without the right teacher you will get lost and you will lose a lot of money. To do manual trading also requires the right mindset and nerves of steel. When it comes to manual trading, we have already done some of the homework for you. We recommend that you have a look at what this link has to offer. Here you can start your journey to becoming a full-time Crypto trader.
The right amount of heat
Before we pop the cake mixture into the oven, the oven needs to be pre-heated. If the oven was not pre-heated, it messes with the timing that is recommended for the cake to be in the oven. The oven must also be set to the right temperature otherwise the whole exercise would have been for nothing.
We need to understand that Cryptocurrencies are still part of the global markets and markets move. The idea of pre-heating the oven is the same as knowing when the right time is to enter the markets. Just because you have some Bitcoin or other altcoins does not mean you must buy or sell just because you can. There are many factors to consider before jumping into the markets. Before you pop your Crypto cake into the oven, do your homework. Find reputable sources that confirm what the markets are doing. Become part of a community that can educate you on some of the factors to look at before buying or selling. Surround yourself with like-minded people and get enough information. Read. Grow. Educate yourself. Do not run after the next big thing.
If you are not going to be in the Crypto markets for the long run, then do not even consider getting in. This is a volatile and risky market, but with a long game mindset it can yield great returns. A cake also does not stay in the oven indefinitely. At some point you must take it out. Markets do not always stay in a bull-run of a bear-run. They change. There are some great tools and communities available that can help you to understand when and why markets change. These tools and communities serve as your timer to tell you when the cake is done baking. Listen to them. Embrace them. They will help you to enjoy the end result.
A suitable occasion
Birthdays are great times for baking cake. It is a time to celebrate and a time to enjoy life. Cryptocurrencies are not a thing of the future. It is happening now. It is now a suitable occasion to start baking your Crypto cake. Although there are many difficulties in our society currently, the crypto markets have excelled through all these challenges. Crypto’s are robust. They can stand strong while other markets fail.
It is now a suitable occasion for you to get your ingredients together, set up your utensils, start pre-heating the oven and let’s bake a Crypto cake!
*Price of BTC at the writing of this article was $11720