Many people are introduced to the world of cryptocurrencies with the idea that “just buy low and sell high” to earn money, but the data show us how complicated this strategy is. While a study by FGV showed that only 1% of day traders manage to make money from the activity, the famous “buy and HODL” – buying bitcoin constantly guaranteeing a good average price – has proved to be a safe and profitable strategy. First, remember that Bitcoin and other cryptocurrencies are digital currencies. The idea of long-term investment or speculative assets is individual, each person uses open software the way they prefer, and acquires the coins for their own purposes. LookIntoBitcoin data shows that 99.9% of the days proved to be profitable to buy Bitcoin. The graph, which shows the price of the cryptocurrency on a logarithmic scale, separates good days in green and days in losses in red.
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See below how it is today, a day when the main crypto market reached its historic high once again, this time exceeding US $ 63,500.With the recent drop to $ 62,934 at the time of writing, the only coins purchased at a loss by hodlers are in this short variation on Tuesday (04/13).
The importance of not selling
For Bitcoin buy and hodlers, there are two well-accepted theses that motivate strong hands (meanwhile, sellers are commonly recognized as lettuce hands). One says that the potential of BTC is to become the gold of the next generation, a store of value so robust that it should only be sold in times of need. The other thesis believes that Bitcoin will be used directly as currency, so there is no reason to exchange it for fiat currency.Some even oscillate between one thesis and another, separating an amount to save as digital gold and another that they will only use when local retailers are accepting Bitcoin directly into their wallets.
But what is the best way to accumulate bitcoins?
Trying to find the best times to buy and sell, in trades that aim to make more money in less time can be a treacherous activity, as the study showed that found that 99% of day traders were at a loss. The survey, commissioned by the CVM, also found that their performance worsened over time, instead of improving with practice and training. In addition, the time devoted to the study of trading can shift the focus from current sources of income, often leading people – tempted by greed – to exchange their steady work for the risky activity of the day trade. Instead of constantly speculating, the simple recurrence in buying has proved to be an extremely profitable strategy, considering Bitcoin's insane upward trend since its birth. in 2009. According to the BitcoinHodler.io simulator, monthly purchases of 50 reais (approximately US $ 8.80) from the beginning of 2016 until today would result in 0.3 bitcoin. This would be reflected in almost 108 thousand reais in purchasing power, spending only about R $ 3,000.This simulation may have been impressive because it started in January 2016, but the great thing about this strategy is that it is not necessary to set the right time in the market. Take for example someone who invests the same monthly amount as of December 2017, the month in which Bitcoin first reached its peak of $ 20,000.In this case, it took the investor a year and six months to be in profit, but the build-up during the bear market ended up being enormously rewarded today. The buy and hodl strategy in this case resulted in 0.044 BTC in portfolio, with purchasing power equivalent to R $ 15,800 spending only approximately R $ 1,940. And to buy constantly without worries about short-term fluctuations, the best strategy is to ensure a subscription to Coingoback Loop. You pay R $ 100, R $ 250 or R $ 500 every month on your credit or debit card, in a simple and easy way. On the platform, you can track the balance of your portfolio, profit (in reais and in percentage), the average purchase price and the amount invested. In addition, you can withdraw the bitcoins to your wallet after 1 month of the first one, to guarantee the custody of the coins and guarantee the hold strategy.
Thus, for a bitcoiner with a well-defined long-term thesis, the best strategy has not been to try to forecast the market with risky trades, but only to accumulate guaranteeing a good average price. bear market, as these are the best times to buy cheap coins. If Bitcoin is really here to stay, the buildup will be rewarded. The Coingoback crypto cashback platform now allows Bitcoin investors to accumulate bitcoins every month with a credit or debit card, carrying out the average price strategy for the long term. A strategy that has worked for BTC since the beginning of the cryptocurrency.Follow the Cointimes channel on Telegram!