to invest profits crypto

Even if they are low, it all adds up.

Do your research before you trade. To become a successful crypto investor, you need to start taking good habits right now.

5. You Overtrade

Some investors, mostly beginners, want to make 20 trades a day. This is dangerous.

Ultimately, many of them lose from fees or because they make bad trades a mistake and then trade more to recover their losses. Only to dig a deeper and deeper hole for themselves.

The reality is that there aren’t 20 good trading opportunities in a day. Trading too much leads to poor decision making and a bad cryptocurrency investing strategy.

6. You Don’t Understand Tax Implications

Overtrading also increases your tax liabilities.

At least in the United States and Canada.

How to invest crypto profits

Take your time and look at different historical time frames to help you better predict the future market!

Takeaway: if you think the market is ready for a bull run, then add more altcoins to your portfolio. On the other hand, if you believe the market is going down, sell your altcoins for Bitcoin, or even better, for fiat or stablecoins.

41.

You Ignore Airdrops

Airdrops are free money with little to no effort.

Many times, new projects will airdrop their token as a marketing strategy to raise awareness.

You might need to register on their website to claim the airdropped tokens, but sometimes, you have to do nothing at all.

Check out AirdropAlert to be on top of every airdrop opportunity.

42.

DO NOT buy high, especially when a coin is close to its all-time high.

After all, why buy Bitcoin at $20,000 when you can buy it at $3,500? Buying high may be the right decision in some cases, but is a mistake more often than not.

21. You Don’t HODL Hard Enough

On the flip side, lots of investors are impatient and ‘cut their losses’ early because of emotions.

The cryptocurrency market is made of cycles, where prices rise and fall drastically.

If you buy high, then you will need to wait out an entire new market cycle to end up with profits – meaning a new bear, then bull run – which can be well over a year of waiting.

Source: imgflip.com

Remember: if you still believe in the project, then your best bet is to be patient and hold strong, even if the price is dropping fast.

22.

To invest profits crypto-137

You Invest Your Life Savings

Rule number one of investing; don’t invest more than you can afford to lose.

You should go into this ready to lose whatever you put in. Ultimately, as the price swings up and down, you should remain calm and still be living a healthy life with room for regular spending.

I’ve heard countless horror stories of people investing greedily with their entire life savings or borrowing large sums of money.
This is a HUGE mistake.

Funny enough, even if you hit it big, your greed will likely win you over. For example, if you invest $50,000 and at one point have $150,000, then your mind will rationalize and normalize these winnings to feel less significant than they are.

The next thing you know, the market drops, and you are back at break even, or at a loss.

8.

To invest profits crypto-dunger

You just have to invest at the right time — like in December 2017, when no one could lose.

But investing at the right time requires luck. Only those who improve their cryptocurrency investment strategy every day, one mistake after another, consistently crush the masses.

Only the most skilled and disciplined investors are running away with big profits over time, while dreamers and noobs end up hodling useless coins and that is a bad cryptocurrency long-term investment strategy.

This is why I have curated the ultimate cryptocurrency investment strategy: a list of common mistakes to avoid when investing in the crazy crypto world.

We’ll start with basic mistakes and progressively move to more advanced ones. So if you are an experienced investor, make sure to read until the end.

Let’s get started!

1.

To invest profits crypto-pro

But adoption is accelerating incredibly fast. Let’s look at some metrics.

Coinbase, the largest U.S. cryptocurrency exchange, was adding around 55,000 new accounts per day last November.

In a month, that’s 1.7 million new crypto (mostly bitcoin) users.

Let’s say half of those actually invest, and that they invest $3,000 on average (less than half a bitcoin). I suspect this may be a conservative average, but it’s hard to say.

This influx of new buyers from Coinbase would add more than $2.5 billion in buying pressure per month (if they each bought less than half a bitcoin).

The total value of all 16.6 million bitcoins in the world today is around $140 billion, with each coin being worth around $8,315 as I write this.

On the supply side, 1,800 bitcoins are currently being “mined” per day.

You Lack Patience

Be patient – because the sophisticated, wealthy investors are.

You may feel desperate to find the next big investment opportunity, but “whales” have enough capital to sit on the sidelines for two or more years waiting for the right time to strike. They can easily stay in a bear market, with losses, for years.

In other words, wealthy investors can afford to be in losses for multiple years to shake out weak HODLers.

If you lack the patience and knowledge of this, then you will always be buying on the wrong side of the market.

If you are patient enough to wait even an entire year to buy in a bear run or HODL until the next bull run, then you will benefit greatly and that is a good cryptocurrency long term investment.

39.

You Chase Cheap Coins

Don’t chase cheap coins with dreams of lambos and private jets.

Lots of uneducated investors in the crypto space buy low priced cryptocurrencies because they think there is a higher chance of big returns.

If presented with one coin priced at $0.01 and another at $75, they blindly purchase the $0.01 coin because they think it’s easier for a coin to go from $0.01 to $0.02, rather than from $75 to $150.

This is a common trap.

There are lots of factors that affect a coin’s price, including two important ones: the circulating supply and the real world value of the coin.

More often than not, a cheap coin has a huge supply of coins, which dilutes the price of each coin.

What is cryptocurrency?

Cryptocurrency is a type of digital currency that doesn’t rely on a central authority to verify transactions or create new units. Instead, it relies on cryptography to prevent counterfeiting.

Blockchain technology supports cryptocurrency.
A blockchain consists of individual blocks of data that can contain information about anything, such as transactions made in a specific cryptocurrency. Each block of data makes a reference to the previous block, creating a chain of blocks.
The reference uses cryptography to ensure the chain remains immutable so hackers are unable to change data.

There are thousands of cryptocurrencies in existence right now. That’s largely due to the ease of creating a new currency by using smart contracts.

You Research Poorly

Once you understand WHAT you should research, then next is starting the research.

The process will be time-consuming if you’re just starting. But the more you research, the better you’ll become at it.

Here are a few basics to get started:

  1. Have a look at each coin’s BitcoinTalk.org announcements thread and website.
  2. Search on the internet to see if there are reviews on the coin or mentions of it being a scam. If you see lots of talk about it being a scam on Google or Reddit, then it’s worth digging deeper into that to understand the reasoning.
  3. Check on the economics of the coin such as its market cap, trading volume, price history, and total versus circulating supply.
  4. Cross-reference opinions from industry experts.
    Never trust one single opinion.

16.

Many of them have borrowed from bitcoin’s code (it’s free to use), but have improved it in important ways.

They’re trying to beat bitcoin in transaction speed and cost (and a few are succeeding wildly). Competitors like Ethereum create additional functionality, such as the ability to execute “smart contracts” on the blockchain, leading to endless potential applications.

Bitcoin will always have a special place in my portfolio.
I’ll always own some. But much of my time is now spent analyzing its competitors.

It’s an absolutely fascinating field. Competition keeps the technology moving very fast. Some of the most talented developers in the world are racing to make their coins the best.

To learn more about altcoins, you can check out our CryptoAsset Strategies service.

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