Cryptocurrency books aimed at beginners or non-users tend to follow a very similar pattern. Almost everyone starts with the obligatory “money story” and explains why it is “embarrassing”, for example, to be polite. Then Bitcoin (BTC) was introduced using several brilliant new technologies that could solve some of these problems.
The books go to mining, wallets, stock exchanges, Ethereum, smart contracts, all currencies, and decentralized finance, also known as DeFi. When the authors are confident that the reader liked the idea of buying a cryptocurrency, they nicely wrap it up with a (alleged) account and calm down.
Even with the desire (and knowledge) to buy the first cryptocurrency, the reader can still feel that this is an obstacle to the next step. After making a purchase decision, a whole series of new questions arise that must be answered by a smart cryptocurrency exchange.
How much should I spend? What strategies are available to me? Is it worth investing or considering trading? How can I maximize profits while minimizing risk? Few books go deep into this area to give the reader the confidence to enter the market with at least half an idea of what they are doing.
Break the shape?
Digital Assets: Your guide to investing and trading in the new cryptocurrency market is designed to fill this gap. Written by Jonathan Hobbs, an investment expert who has become a freelance consultant, the book is divided into two parts.
Admittedly, Part 1 starts as expected with a cache-by-cache; But honestly, it would be difficult to exclude that from this beginner-friendly codebook. And let’s be honest: you never get old when you hear how bad the traditional economic system really is.
Hobbes then gives a glimpse into Bitcoin’s decline, but only to show that he can be trusted, that it is a hedge against inflation, and that there is a reason for the value to continue to rise in the long run.
Ethereum and DeFi are explained in the same way from an investor perspective, such as how to make money by placing tokens on lending platforms, trading derivatives or offering foreign currency liquidity.
The first part ended with two chapters on how to improve the choice and availability of cryptocurrencies for both institutional and individual investors. The development of custodian solutions at the institutional level, as well as funds and trusts related to cryptocurrency, has opened the door to a growing amount of institutional and corporate money.
Improvements in the security and functionality of exchanges and wallet solutions, along with the emergence of DeFi, are meeting the needs of individual investors like never before, and this brings us to the point where most of the other books have left us.
Saves for a rainy day
Fortunately, this is where digital assets are located right now. The second, longer section is devoted to all the details of trading and investing, starting with the question of how many assets you should have in cryptocurrencies.
Hobbs explains the importance of a diversified investment portfolio and compares the historical returns of various stocks and also owns up to 10% in bitcoin. Some readers may be intimidated when they find out that due to fluctuations in the rate of cryptocurrencies, he does not recommend putting many eggs in it.
Digital assets also provide examples to demonstrate the effect that portfolio rebalancing can have to reduce risk and exposure to volatility.
The book continues with Cryptocurrency Investing Strategies, covering the ever-popular HODLing, the dollar average, and the more aggressive average. Possible results for each of them are illustrated with examples using real historical data for different periods of time.
And then it all starts with the things of big children …
If you were a casual enthusiast, technical analysis would be a source of confusion. Of course, anyone can understand what a falling wedge is, which means turning resistance into support and the importance of the 20-week moving average.
But you don’t know why these things will affect the price of bitcoins the way they do, and therefore you have no real faith that you can use them to predict future actions. Correction: At this point, you need to have an idea.
Hobbe’s introductory chart reading book, which identifies trends, moving averages, volume and Fibonacci retracements, gives the impression that technical analysis is something that can actually be done or at least learned over time.
Digital Assets explains how to take advantage of Bitcoin’s volatility by trading short or long futures contracts. It demonstrates how to read candlestick charts and describes the various trading patterns as well as the associated trading time frames.
Of course, risk reduction is just as important as it is obtained.