In 2009 when Bitcoin first launched, traditional fiat investors were somewhat intimidated by the thought of a paperless digital currency. The fact that absolutely nothing existed to enable researching or tracking of cryptocurrency, no banking tools, charts, or indexes, all standard tools in the financial world, made it even more difficult.
A lot has changed in ten years. With new technology hitting the market constantly, the trading and long term holding of cryptocurrency have become much easier for the average investor. Businesses are now using crypto as a primary source for financial transactions. Crypto bookkeeping tools have taken the place of tedious, manual spreadsheets as management tools for investors looking to increase profitability through cryptocurrency investments as well as for businesses.
Helpful investment trackers
Trackers can be useful for almost anyone with a stake in blockchain-based investments. As one of the fastest growing, most dynamic and innovative technologies currently in existence, it is nearly impossible to keep abreast of everything that is happening in and around the blockchain world.
Since 2011, rival cryptocurrencies to Bitcoin have been flooding the market with new investment options. Q1 ICOs had raised more money than all of 2017. By the end of Q2 2018, ICO volume had surpassed all previous ICOs in history, with a grand total of $13.7 billion USD.
Of course, high dollar volume also means a lot of new token options to invest in. Some of these tokens have taken off, becoming strong long term investments despite the past year’s rough bear market. Investment opportunities have taken off and have sparked the need for rigorous crypto accounting tools.
Others are not so fortunate. According to reports compiled by Coinopsy and Deadcoins, over 1000 ICOs failed in 2018 alone. Without a strong crypto portfolio manager, many investments have fizzled. This is not as dismal a failure rate as it initially looks. The U.S. Bureau of Labor Statistics reports that only 35 percent of small businesses survive the ten-year mark. Twenty percent close their doors within the first year of existence.
This leads to a lot of options to invest in. For some, who choose to compile an extensive portfolio, it can lead to the need to keep a close watch on various investments to ensure profitability, both short and long term. Tracking at this level is difficult if not impossible to maintain manually.
This level of market growth, which has led to an explosion of crypto investments available, has also resulted in a need for crypto asset auditing and bookkeeping tools. Long thought of as intangible assets, large businesses, and even government entities are considering a venture into the crypto space. Tracking tools are stepping up, offering enterprise crypto accounting tools as well as bookkeeping services for the cryptocurrency.
Another challenging aspect of cryptocurrency investing is its ten-year history of massive price fluctuation. Anyone with even a moderate interest in blockchain technology has observed the ongoing turbulence experienced by the entire crypto market over the past year. Bitcoin, which nearly hit $20K USD a year ago, lost more than 80 percent of its value over the past year. After a terrible November and December, Bitcoin currently sits below $4K, where it has been for over a month.
Bitcoin has taken the entire market down with it. No coin has been immune from this bloodbath. While experts all concur that the market is bound to stabilize at some point, nobody can agree on when this might take place. Some argue that cryptocurrency is at rock bottom now and on its way up. Others suggest the market has a long way to go before it sees any positive change.
The Role of Crypto Bookkeeping
This is where crypto bookkeeping comes in.
Crypto bookkeeping tools such as Blox can integrate all of a client’s wallets and exchanges into one central dashboard, allowing clients and account managers to assess progress through price and transaction history trackers.
Individual investors may be able to track investments with spreadsheets, but asset management companies need a better solution, one that updates automatically and that is less liable to entry errors and as well as being more secure.
Other core features most crypto asset management tools have included support for multiple users such as teams and external auditors.
Security is essential. Crypto investment is a high-risk endeavor, and any tool that integrates with clients’ wallets must use high-level encryption to be 100% secure.
It is perfectly possible to manage clients’ assets using spreadsheets, but data-entry is subject to operator error, and no professional can afford errors of any kind.
Crypto bookkeeping software integrates with clients’ wallets and exchanges, removing the need for hands-on data-entry and all the associated errors. Clients are paying you to manage their assets in a professional, transparent and accurate manner. The right software allows you to do all that.
Industry player Fumgo gives 5 tips on how to trade cryptocurrencies
Look, you could have bought one bitcoin in April for $4,000 and sold it today for $8,000.
It sounds like an easy way to earn money, right? The crypto trading, however, isn’t that simple. In fact, the always-changing price, high stakes, and online scams make it also dangerous for those who know little about it.
So when you take risks for rich rewards, make sure to follow these tips:
1. Use reputable exchanges
To trade cryptocurrencies, you go to exchanges, internet platforms that help buyers and sellers meet.
But high market demand brought in a number of phony exchanges. You must keep an eye out for them and make sure you use only reputable ones like Bittrex, Huobi Global, OKEx, HitBTC, or Binance.
There are also trading terminals like Fumgo. The terminals let you trade across multiple exchanges — including the ones mentioned above — from one interface. In fact, it’s even safer to use them, because they offer two-factor authentication when you log in, unlike exchangers.
2. Learn from professionals
Crypto trading is a job. You need to monitor the price movements and make decisions. This is hard to do without knowledge about the market.
Find real traders and learn from them. Some of them post videos on YouTube.com, others publish articles. It takes time, but it’s well worth it.
At this stage, beware of scammers who have never traded cryptocurrencies but promise to teach the craft. The internet is full of free tips, but these “experts” sell them as professional knowledge.
There’s a way to shortcut the learning curve: the Fumgo terminal has a feature that allows mirroring the traders. If you switch it on, it will make your account copy the actions of chosen professionals automatically. The system verifies them — only true pros allowed.
3. Practice with small sums of money
Seen enough and feel confident? Then it’s time to practice. But don’t rush, start with small investments.
The cryptocurrencies rates change unpredictably, so invest the amount of money that you wouldn’t regret losing. Practice as much as possible this way and when you manage to earn regularly, raise the stakes.
4. Stick with one strategy
Every trader has their own style. Copy one and stick with it for some time, see how it goes. If you change your strategy too frequently, you won’t be able to see the result.
Three tricks are universal, however: 1) make a limited amount of transactions per day to approach trading energized; 2) pay attention to Bitcoin, its price influences other currencies; 3) keep statistics on your transactions to understand what strategies work best.
For the latter, there’s a shortcut, too. The Fumgo terminal tracks your stats automatically and shows the history of all the transactions.
5. Trade different currencies
Bitcoin isn’t the only cryptocurrency worth attention.
The price for Monero, for example, has been changing constantly from $10 in 2017 to $100 today. At some point, it even cost $500. The same with Dash and Ethereum.
Pro traders usually devote only 5–30 percent of their capital to one cryptocurrency. Follow suit.
The easiest way to keep track of your cryptocurrencies is via terminals: in one interface, you can compare the rates of your cryptocurrencies across various exchanges and sell each where it’s most profitable. Terminals usually have subscription models: Fumgo, for example, costs $20 a month but offers a trial week and two free months for subscribers.