Some people think cryptocurrencies are a shortcut to wealth, but it’s not always that simple. Purebase Studio’s crypto expert and NFT studio head CALV!N began mining and buying Bitcoin and altcoins in 2013, years before apps like Coinbase and Gemini gained popularity among the masses. Because crypto investors can be vulnerable to theft and violence, CALV!N uses a pseudonym to protect their assets and physical security. The expert shares three long-term (and stress-free) investment strategies for people who want to make wealth through cryptocurrencies. we too Cryptocoin. com, we have compiled the expert’s opinions for our readers.
How did he meet the cryptocurrency market?
“It was a completely different world back then,” says CALV!N, noting that there are no exchanges to link your bank account or facilitate your crypto storage. CALV!N and its partner bought Bitcoin and Litecoin with extra profit from their business and started mining Dogecoin. He spent $4,300 on mining equipment, $1,700 in the first month of electricity bills and started putting a few dollars into Bitcoin and Litecoin. “We mined about 5 million Dogecoins in 2013, but they were only worth a few hundred dollars, so we were losing a ton of money,” the expert says.
CALV!N has stopped mining Dogecoin and stored it in a crypto wallet. He completely forgot that there was even 5 million Dogecoin in that wallet and turned to other ventures. When he looked at the wallet in 2017, it was worth $65,000. Between 2013 and 2021, CALV!N relied on highly successful transactions to build its portfolio, making only five investments in total over the past eight years. Now his portfolio is worth millions. The expert shares three long-term (and stress-free) investment strategies for people who want to make wealth through cryptocurrencies. These aren’t all that different from the best advice for investing in the stock market.
Investing strategies in bitcoin and altcoin markets
1- Invest only what you can afford to lose
“Unless you’re a professional stock trader or someone who looks at charts 24 hours a day, keep it simple,” CALV!N says. Just as financial planners typically don’t recommend investing the cash you’ll need in the next five years (the time horizon is too short to make up for any loss). The expert warns against forcing yourself to buy Bitcoin:
Don’t buy crypto with the money you need to live. You shouldn’t compromise your quality of life just to buy crypto, and if you do, you may not be in a position to make rational decisions about your investments.
2- Buy it and forget it
According to CALV!N, too many people try to achieve this 300-fold increase in a week or a month, and it can happen, but for most people this is not the case. The expert states that many people with billions or hundreds of millions of cryptocurrencies are people who have held it for seven or eight years. He says this strategy performs much better than day trading:
My friends and I pooled our resources to purchase 40 Bitcoins at the beginning of 2020. Our initial investment totaled $280,000 and is now over $2,000,000. It was impossible for us to earn that much money through trading.
Expert suggests treating crypto as an investment for retirement. He recommends being slow and steady over time. “If you can afford it, start with as little as $10 off each paycheck, whatever the price,” says CALV!N. This is a traditional investment strategy called dollar-cost averaging, which helps manage risk. He also says it will save you from the emotional roller coaster of checking the market every day.
3- Know what you’re investing in
The expert recommends learning about the utility of each cryptocurrency (or token) (what people actually use it for) before diving in:
Ask yourself: Is this project something that could change the way people interact with technology in the future? Do I see myself using it in the future? If your answer is no, don’t invest.
“The same approach you would take when investing in the stock market, mutual funds, ETFs or retirement accounts,” says CALV!N, invest in securities you understand and leave the speculation to the professionals:
For example, the utility of Bitcoin is to store value like gold and silver. The utility of Ethereum is to run smart contracts that provide fraud protection for its users. And there are meme coins, all of which are hype and useless, but can provide huge rewards.
The expert concludes his advice by saying, “No matter how you invest, it is important to make informed decisions without getting excited.”