Are you thinking about investing in crypto but don’t know where to begin? Do you worry that you’ll make the wrong choice and lose your savings?
About 44 percent of crypto investors plan to hold their coins for more than four years. That demonstrates a lot of faith in the value of crypto.
If you’re investing in crypto to make money, you need to have a strategy. Here’s a guide to creating crypto investment plans for a beginner.
Hold for the Long Term
If you believe that cryptocurrencies are here to stay and will become more valuable over time, this is a strategy to consider. This plan is called HODLing in the crypto space, and it refers to buying and holding for the long term.
One tip for holding, if the coin you want to hold also allows for staking, it is a fantastic way to grow the size of your investment through staking rewards while holding and waiting for an increase in the asset price.
Invest Regularly
It’s always a good strategy to invest small amounts regularly. If you can set up an automatic contribution or transfer from your bank to a crypto exchange, that will allow you to accumulate small amounts of crypto at different prices over time.
Dollar-cost averaging is a technique used by investors in the stock market. When you make regular purchases, you smooth out market fluctuations and end up with an average cost for your coins.
It’s easy to purchase crypto anytime at a Bitcoin ATM with a single click. You could buy some each time you visit your local convenience store. This method is more advantageous than purchasing a large amount at a set price because of price fluctuations.
Earn Interest on Your Crypto
Many exchanges offer relatively high-interest rates on your crypto balances. Your crypto investment profits will be higher than what you would earn on cash held in a traditional bank account.
If you’re willing to lock your crypto in for some time, you can earn an even higher rate of interest on these digital assets. Some exchanges pay interest daily, which allows you to make compound interest on your coins.
Buy the Dips
Even though it’s challenging to know what the cryptocurrency market will do, it’s good to consider adding to your coins when the market price dips. Sometimes it’s hard to buy when coins are dropping but if it’s part of your plan, you can overcome your concerns.
If you hold a percentage of your crypto in stable coins, you’ll be ready to take advantage of dips in the market and get a better return on your investment in cryptocurrencies.
Diversification Is Key
While Bitcoin and Ethereum are two well-known cryptocurrencies, there are many other options available to investors. If you are a conservative investor yet want to hold crypto, a US dollar stable coin can be a good investment for you.
There are many other options for cryptocurrencies, and it isn’t easy to know which ones will be successful. A crypto exchange-traded fund (ETF) is a great way to gain exposure to a more significant number of coins with lower risk. These ETFs trade on the traditional stock market, which is easier for a beginning investor to access.
Begin Creating Crypto Investment Plans Today
Now that you have some strategies for creating crypto investment plans, you can proceed with confidence. As you buy and sell some coins, you’ll learn more about crypto investment risks and rewards.
If you enjoyed learning about crypto investment strategies, you can find more financial advice on our blog. Check it out today!
