5 Crypto investment strategies you should know
In just a little over a decade, cryptocurrencies have grown to become a rewarding asset class. Household names like Bitcoin and Ethereum have reached exponential growth, while thousands of digital currencies have cropped up in recent years. Of course, not all currencies are created equal, and some have turned out to be a lot more volatile than the rest.
In crypto, there are as many risks as there are opportunities. So it’s important to understand the different investing strategies so you can make the most of crypto and invest your hard-earned money according to your risk tolerance.
Invest in crypto using these 5 strategies
Here are five of the most effective strategies to build wealth with crypto:
Dollar-Cost Averaging (DCA)
Dollar-cost averaging (DCA) is one of the most popular ways to invest in volatile markets such as crypto. This strategy involves investing a fixed amount of money at regular intervals rather than a big sum at once, regardless if the market is bearish or bullish. This approach allows investors to weather rapid market swings. The risks are lower in this approach as it focuses on steady, long-term gains rather than quick, handsome returns. Timing is a key part of crypto investing, and if you buy or sell at the wrong time, you could risk losing your money. But by dollar-cost averaging, you can minimize this risk while still maximizing opportunities to make a profit.
Buy and hold
Buy and hold, also called HODL (hold on for dear life) by many crypto investors, is a strategy that has gained traction in recent years. This approach involves buying a digit