Rey Simmons is an investor who focuses his attention on stocks and, more recently, cryptocurrency.
Simmons joins Black Man Sundays to talk about the ins and outs of putting your money into the emerging cryptocurrency market.
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“As a beginner, what you really want to focus on is the technology behind crypto,” Simmons said. “I usually tell people that are just starting out, ‘You really want to start with what blockchain even is.’”
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Blockchain is a complicated, electronic ledger that tracks transactions and ownership of assets, mostly digital ones such as cryptocurrency or non-fungible tokens; however, Simmons believes the technology will soon be applied to physical assets like real estate.
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Simmons believes the complexity of the blockchain and the potential volatility of cryptocurrency prevents many people from investing in it.
“They don’t want to waste their hard-earned money on something that is volatile or they’re unsure of,” he said. “There are some people that think crypto is just fake, made-up money.”
Simmons said he used two websites when he starts researching a specific cryptocurrency: CoinMarketCap.com and CoinGecko.com. These sites help him identify new cryptocurrencies. Once he finds a coin that piques his interest, Simmons looks to see whether they have a website.
“If there was a website available, I would look for something called a white paper,” he said. “A white paper basically will give you the entire vision, a laid out roadmap of exactly what this crypto entails, what it’s trying to accomplish.”
After finding the white paper, Simmons will look to see who else is investing in the currency. If a larger company is putting their cash into a specific coin, that’s usually a sign of a promising investment.
“A lot of these companies and a lot of these coins, even though they’re not big right now, they’re working and doing mergers, and they’re working with major companies that we’re used to seeing and hearing about,” Simmons said. “That’s just one reason that I try to explain to people like, ‘Hey, listen, you need to really understand the fundamentals of this project before you put your hard-earned money into this.’”
Simmons also stressed that people should only invest what they are willing to lose.
“You want to make sure (your money is) going to a place where it’s going to actually work for you,” he said.
In the latest episode Black Men Sundays, Simmons goes deep into what the blockchain does and how investors can use it. He also talks about how a website selling digital cats helped get him interested in cryptocurrency.