Many people talk about big games regarding cryptocurrency investment but are out here taking a gamble on their investment. Not only is this risky, but it’s hard to replicate even the ‘lucky wins’ they’ve had, and they repeat mistakes in hopes of success but instead record losses than profits.
This is no way to go about any investment, talk more of a market as volatile as crypto. Crypto investment is a serious business, and it would do you a world of good to act like you know this.
In this post, we’ll explore life-changing strategies that will elevate your crypto investment game and put you in the top percentile of crypto earners.
The best strategies to use in cryptocurrency investment in 2023
To make it big in crypto, you need to move with precision, a plan, and a clear strategy. A plan and strategy would help you grow your crypto investment and portfolio.
As laid back as money-making in crypto may seem, you need some reinforcement before entering the market, and this is called your crypto investment strategy. These are the seven best strategies you should use in your crypto investment.
1. Invest wisely – Only put in what you can afford
This is the most fundamental rule in any investment — especially crypto. Investing without gauging your risk tolerance may lead to irrecoverable loss. You already know the nature of the crypto market; the price fluctuations are no joke. Even seasoned investors do not risk more than they can lose, so always stick to this rule.
Sure, there is the ever-present temptation to put in more for higher profit, but that’s fear of missing out (FOMO) rearing its head —don’t give in.
2. Diversify your portfolio
You may think sticking to one coin to minimise risks is wise, but that’s not true. Owning various coins will spread your investment across different projects, which would help you keep the loss to a minimum.
This is because a bad season for a coin may be when another coin thrives. So, imagine you had all your eggs in a weak basket. You’d lose more at once. But don’t just diversify for the sake of it. Ensure you’ve researched the crypto extensively and are convinced of the project's sustainability.
You can also look into other blockchain projects outside of crypto to invest in. Some are Non-Fungible Tokens (NFTs), Decentralized Finance (DeFi), etc.
Lastly, you don’t have to limit yourself to one exchange. Try out other exchanges that list other coins with excellent prospects.
3. Don’t store all your crypto in one wallet type
Using more than one wallet is more of a safety concern than an investment strategy. But what use is putting in all the work if you lose some money at the end of the day?
Two different types of crypto wallets serve different purposes:
- Hot wallets are connected to the internet and are available on the standard apps you use to conduct transactions.
- Cold wallets aren’t connected to the internet. You can access your hardware devices using private keys generated from specialised websites.
So, how do you go about it?
If you often trade crypto, a hot wallet would be ideal for storing transactional amounts of crypto. That is crypto that you’re moving out soon. But for long-term investment, use a cold wallet to keep your investment offline.
4. Invest more in liquid crypto assets
A liquid asset can be easily converted to cash while retaining its value. You know how fast the crypto market moves, so knowing when to enter and exit is essential. A liquid asset allows you to do this quickly without sacrificing some of the fiat value.
So before you invest in crypto, there must be substantial demand and supply so you can easily purchase and sell when you profit. You don’t want to buy an asset and wait for it to get some demand before you sell and put yourself at the mercy of the market.
The crypto with the highest liquidity is Bitcoin, as expected. There are various ways to measure a coin's liquidity – one is to check its trading volume.
5. Take advantage of crypto volatility
The price fluctuations of the crypto market can play to your advantage if you know how to navigate it. As a crypto trader, you can buy the dip and sell when the price is favourable. Don’t see the volatility as a threat but use it to your advantage. However, to succeed, you must pay close attention to the market.
6. Withdraw your profits regularly
Before you invest, identify your goals first. This will help you be more decisive in taking your profit when the time is right. Some traders are often at crossroads when it’s time to exit the market because they’re unsure whether the price will soar or dip. You’ll maximize your investment when you know when to withdraw your gains.
7. Leverage Dollar-cost averaging
Dollar-cost averaging is a shield many investors use against volatility. It is when you invest a fixed amount consistently instead of all at once. This works because, whether in a bullish or bearish season, you’re investing the same amount of money. So when the market is down, it gives investors a higher chance of buying more for less.
It’s a great way to be objective about your investment and keep you focused on your investment goals.
Wrapping it up
There you have it, fellow crypto enthusiasts. These strategies will give you the winning edge and significantly improve your cryptocurrency investment. Don’t forget to be safe and always do your research before investing.
When it’s time to reap the juicy rewards, use the Breet app to sell your crypto for maximum profit. Whether in Nigeria or Ghana, you can enjoy the most seamless crypto transaction at the best exchange rate every single time!
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