What You Need to Know to Invest in Bitcoin and Crypto for 2021
Crypto may be constantly changing- but some things will always stay the same.
Investing in crypto and bitcoin can sometimes feel like you’re trying to calculate velocity with an ice cream cone… in a word- confusing. Which is pretty understandable, as cryptocurrencies are essentially place holders for some of the most exciting and novel technological advances that we are seeing as a society. While it’s easy to get excited about investing, it’s not without its perils and pitfalls.
Perhaps the best strategy for any new investors looking towards 2021 is finding a great exchange platform. Platforms like Bitvavo not only offer novice retail investors a chance to deal with multiple cryptocurrencies, but they can also help better prepare you for learning how to navigate the market itself. Choosing the right crypto wallet is also a massive step in the right direction towards safer and more useful investments. Exchanges and wallets will probably always be important aspects of investing wisely, but what other crypto tips hold on strong?
ABR: Always Be Researching
Just to make sure you were paying attention- we’ll say it again: the crypto market is incredibly dynamic. Price fluctuations, tech developments, political climates, and a number of other highly volatile influencers play a part in how you will invest your bitcoin. That’s why it’s so incredibly important to always be researching new trends and paying close attention to what’s happening in the world. There are a number of diverse sources that can give you a more complete idea about what’s happening with crypto. Traditional media outlets, social media, YouTube, market trackers, and exchanges themselves can all help provide a clear picture of what may happen in the future. It’s important to gain your sources from varied tested accounts, creating an amalgamation of what’s currently happening, and then use that to apply to what could reasonably be expected from the future.
HODL
Investing is exciting! There’s no doubt about that, but constantly moving money and assets around, hoping to make short term gains is often exhausting, and can sometimes be a detriment to success, especially with bitcoin. Despite the fact that the term came from a serendipitously timed drunken rant- the misspelling of “hold” has become a mantra of serious investors everywhere for a reason. HODL, which has come to mean “hold on for dear life” basically just means to sit on the bitcoins you already have. This is because over time, bitcoin has time and time again proven itself to have some pretty spectacular returns on investment. So, once you score yourself some bitcoin- save it for a rainy day.
Buy the Dip
Another timeless classic bitcoin trading tip is to “buy the dip” or purchase when everyone else is selling. Bitcoin has historically had an incredibly volatile price, which means that the “buy low, sell high” strategy is actually quite a bit easier to pull off than in most traditional markets. Mostly because, when bitcoin tanks, the price really drops. But a massive bull run is usually right around the corner. Take March 2020 for example: During a total market shakeout, bitcoin’s value dropped to a measly $5k per coin. The market quickly corrected, and is now seeing values near $16k per BTC. Which for the purposes of simple math, is basically triple the price. Bitcoin has a long track record of these dynamic boom and bust cycles, so grabbing up coins when everyone else seems to be selling off their stores is a great idea.
Diversify
Diversification isn’t just a rock steady strategy for bitcoin and cryptos- but wildly important for any investment portfolio. Having a wide selection of different investments may not make you a millionaire anytime soon- but it also helps to ensure you won’t be playing the part of a young Oliver Twist either. That’s because if you put all of your money into just one asset, then your livelihood falls prey to the whims of that singular market. While there are a good many crypto enthusiasts that have no interest in participating in traditional markets- diversification still applies to them. If that just means pulling occasional gains and investing in other assets, like gold or real estate.
Forget FOMO
FOMO, or Fear of Missing Out, is the bane of every investor everywhere. It is a tongue-in-cheek way of describing the pressure that investors feel to follow the trends that the market is spitting out at that given moment, and one that rarely leads to anything good. FOMO is mostly responsible for the altcoin boom of 2017, when thousands were left holding millions of dollars’ worth of largely useless tokens- just because they wanted to find “the next big thing” in the crypto game. The best way to curb FOMO is by following the rest of these rules to the letter. It’s also important to pay attention to large pattern buy-ins. This can help suggest how much selling pressure there will be in any given market should a bull run go underway. Buying high during a hype period of an asset that bottoms out and is slow to correct, leaves many with intense pressure to sell once that asset regains a price that is near or slightly above what they bought at. Which can help flag markets for quick turns in price. Following the rest of these tips- like buying the dip, diversifying, researching, and holding- are all great ways to help you dodge FOMO and take the emotion out of investing.
The post What You Need to Know to Invest in Bitcoin and Crypto for 2021 appeared first on Ripple Coin News.
OhNoRipple via https://www.ohnocrypto.com/ @Gracie Perez, @KhareemSudlow
