Bought Bitcoin at the Wrong Time? Stop Crying & Do the Right Thing!
Considering you clicked on this article I assume you’re not an active trader, but rather a person who bought Bitcoin at prices way higher than the current one hoping to profit in near future. Don’t worry, you’re not alone but if you want to improve your odds instead of waiting for Bitcoin to reach $20,000 again who knows when, you have to take action.
Before we continue I just want to assure you that Bitcoin and Blockchain technology are not going anywhere. Many alternative coins and utility tokens will disappear in near future, but those with strong foundation and team of developers like Bitcoin, the top 10–25 cryptocurrencies and a decent number of the new projects entering the ICO/IEO/STO market will not only stay alive, but explode in a way you can’t even imagine.
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1. If you can afford to buy more — lower your average cost
I was working in the gaming industry for 12 years and will give you a simple example with a casino game like Roulette. Everyone knows they can bet on Red or Black and their chance is pretty much 50/50 (if we don’t count the Zero). So if you had an unlimited bankroll you could choose Red or Black, double your bets until you hit and then leave the casino as a winner. The only problem is casinos have betting limits on every single game. This means that if you start with a $10 bet you could double it only certain amount of times until you reach the maximum which is normally $500 or $1000.
The good news is crypto exchanges don’t have limits on how much Bitcoin you can buy (we are talking about retail investors like you and me). So for the sake of the example let’s say you bought 1 BTC at $15,000. If you buy another one at $5,000 you will have 2 BTC for $20,000 of your money, which means that each one cost you $10,000. What if you buy 2 more Bitcoins at $5,000 each? Then you will have a total of 4 Bitcoins for $30,000 of your money with average cost of $7,500 each. So if you want to get out of the market (which I don’t recommend) all you have to do is wait for the BTC to reach $8,000, sell your 4 coins and even make a profit of about $2,000. Sounds better than waiting for a price above $15,000, right?
I used 1–4 Bitcoins just to be easier for you to understand, you can apply the same strategy with the amount you have invested whether this is few thousand or few hundred dollars. Sure, there is risk involved but a lot lower at this price levels when compared to the levels you entered the market. This is the time when smart money are entering and the only reason you see significant price drops is that the Wall Street boys want to own as much Bitcoin as possible before they start offering it to their clients. The more they own the easier they can control the price later and what they currently do is manipulate the market so people can panic and sell. But at some point they will change the direction to make profits and if you’re smart and patient you will profit as well.
2. If you can’t afford to buy more — diversify in altcoins
I strongly recommend the first strategy, but understand that not everyone have the resources needed to apply it. In this case what you can do is take 50% of your Bitcoin holdings and spread it in a combination of 3–5 altcoins. I will explain why 50% and not all of it later on, just keep reading.
Let’s talk about the alternative coins first. When the Bitcoin price moves up altcoins follow and normally if Bitcoin value grows with 5–10% altcoins will grow 15–30%. Of course you have to pick the right cryptocurrencies and to play it safe I recommend choosing from the top 10–25. Currently they are all “on sale” but I suggest you pick few from the $50-$100 range like Monero, Litecoin or Dash and few that cost less than a dollar like Tron, Ripple and Cardano.
Now, let’s get back to those 50%. You shouldn’t put your entire Bitcoin holdings into altcoins right away because there is always a possibility for the market to go further down and in order to protect the value of your portfolio you need to have a reserve. The purpose of this reserve (remaining 50% BTC) is to add more to your altcoin positions in case the prices go lower — same thing we talked about in the first strategy. I recommend adding more to your altcoin positions if the price of a particular coin goes down more than 10%.
I hope this helps and please remember it isn’t a professional financial advise, but a strategy I apply myself and achieve good results with.
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