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February 26, 2024
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Top 5 Bitcoin Investing Strategies

Most new Bitcoin investors have questions about how to get started on building their portfolios. The critical element is understanding the risks involved with cryptocurrency and how one can mitigate them.

But what is crypto investing, exactly? It is a set of instructions created to help an investor along the way. The first step should be to create an online Bitcoin wallet. Free web versions are available, but users can purchase hardware wallets too.

Joining a crypto brokerage is the next step. From there, all you have to do is choose the investing approach that works for you. Here are a few strategies to consider.

Investing in ICOs

Knowledgeable investors are always searching for an early crypto project that shows promise. Initial Coin Offerings (ICOs) are a type of fundraiser created to support a new cryptocurrency venture.

Many tech companies are working on their ICOs and looking for investors. But how can you be sure if an ICO is the right fit? The answer usually means asking yourself questions about how unique and progressive the idea seems and what are its chances of success.

You also have to review the ICO’s whitepaper and understand the problem the project is trying to resolve.


Some investors are playing the long-term game and are prepared to see the returns years into the future. Choosing this path is relatively low-risk, in the crypto industry at least.

This strategy is known as HODLing and is short for “hold on for dear life.” Typically, users opt for Bitcoin, Ethereum, or another prominent cryptocurrency and don’t have plans on if and when they’re going to sell.

The HODL position is a philosophical one for many users. Some crypto enthusiasts have been practising this strategy for years, hoping that one day Bitcoin will replace fiat currency. But others may choose to sell if the value of Bitcoin rises to their expectation.

Taking the Short or the Long Position

Two prevalent investing strategies revolve around Bitcoin’s volatility. Essentially, going short or shorting means borrowing assets and selling everything they hold at the current price of Bitcoin.

When the price drops, the investor rebuys the same amount of coins, pays back the debt plus interest, and keeps the difference for profit. This only works if they’ve correctly predicted that the value of Bitcoin will decrease.

On the other hand, taking a long position is anticipating that the price of Bitcoin will increase. These predictions can be anticipated via market analysis, and long position investors are on the lookout for the right moment to sell.

Automated Crypto Arbitrage

Investors that are interested in relatively low-risk strategies with steady returns can consider the crypto arbitrage.

This is possible when a specific cryptocurrency is available at different prices across the exchange platforms.

With a crypto arbitrage algorithm, you can buy Bitcoin at the lowest price and sell it at its highest value. This would be incredibly difficult to achieve manually, so many use bots to automate the process.

Rejecting the Media Hypes

Lastly, this is more advice than a strategy, but investing in cryptocurrency shouldn’t come from any kind of pressure.

Social media, news cycles, and even alternative outlets are full of discussions about how now is the time to invest in cryptocurrency. But not everyone can take significant risks, and it’s imperative to evaluate personal financial assets before taking a major step.

Starting slow is always the best approach. Make sure to secure your online Bitcoin wallet. Free crypto exchanges are great, but you have to be sure that all the services you use are trustworthy. Remember that even with significant changes, the crypto industry remains largely unregulated.

Having a Crypto Investing Strategy Is Important

As with many other things in life, having a strategy allows us to set clear goals and understand all the risks. Crypto investors with great aspirations will take the commitment towards building their crypto holdings.

There are many ways one can get there, but the first essential step is not to be guided by the fear of missing out. A good crypto investing strategy encourages more independent thinking and allows users to re-evaluate their positions.

That’s why it’s essential to consider several investing techniques until you find something that matches your philosophy and risk tolerance. Finally, regardless of how you go about managing your investment portfolio, remember that cryptocurrency is volatile, and there are no guarantees in this business.

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