Cryptocurrency Investor — Cryptocurrency Investing Strategy (Avoid these mistakes!)

In this post, I will discuss about Cryptocurrency investing and Cryptocurrency trading.

For a new Cryptocurrency investor, there are a few mistakes that are made often:

1. Trading Cryptocurrency based on USD Value. It is a misconception if you trade your Cryptocurrency only based on USD value. Why? Most Cryptocurrencies are actually measured in satoshi (in Bitcoin). It means you can trade them whether against Bitcoin (BTC), Ether (ETH), or Monero (XMR). These are some of the highest market cap coins, but Bitcoin is the strongest benchmark. If you buy XLM at 0.00003404 BTC, then when BTC price drops by 5% in USD, you XLM will drop by 5% too, even if XLM is still at 0.00003404 BTC. So the key thing is you look at the price in satoshi (BTC), it will help you to trade better and become a better Cryptocurrency investor.
2. Day trading. It is super hard for you to predict the prices of Cryptocurrencies. If you do day trading, there is a very high chance for you to miss out many huge opportunities. You also could be paying out a lot of trading fee with this strategy. A better strategy is to just invest long term in the coins you believe in. Aim for 10x to 100x return in a few years. This could be the safest bet for you as a Cryptocurrency investor, but you need to look for the right coins. Read: Cryptocoin or Cryptocurrency Analysis Strategy
3. Not keeping the coins safely. It doesn’t matter if you are really good at trading or investing if you got hacked. As a Cryptocurrency investor, you need to think about how to protect your Cryptocurrency, not only how to make them. Keeping your Cryptocurrency in a centralized exchange is very risky, there have been many hacking cases around the world that cost many people their fortune. It is better to use decentralized exchanges, where you can trade wallet-to-wallet and the exchange does not hold your fund. You can read more about Best Cryptocurrency Decentralized Exchange (DEX)
4. Panic buy or panic sell. This is one of the worst thing to do as a Cryptocurrency investor, never panic! Make decision wisely. What goes up will go down, what goes down will go up. Buy the dip, sell the tip.

The most important things for a new Cryptocurrency investor to do are:

1. To identify a Cryptocurrency with a huge potential, invest in it, and HODL. Many people apply this strategy because it is very powerful. When you HODL and keep your coins during fluctuations, you may gain a lot in the future. Sometimes, a Cryptocurrency’s price may explode in a few hours or even minutes due to an announcement for partnership or a breakthrough.
2. Participate in the community. Join the Telegram group / Slack group of the project. Look out for the news, monitor the development progress. If something is not being developed for a long time, you may have to sell the Cryptocoin. Even if you need to HODL, sometimes it is wise to sell if you are sure that it is the wrong investment. As a Cryptocurrency investor, you have to know when to sell and when to buy.
3. Learn the technology. It is very hard for a Cryptocurrency investor to identify huge potential without understanding technology. How do you judge if the project is good? How do you know if the team is good.

If this post is useful for you, please give a “Clap” so that others can read this. I hope this can help you to become a better Cryptocurrency investor.

Also read: How to Invest in ICO — Step by Step Guide

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