It seems like the whole world talks only about crypto, and nothing else. Is it really the case, or is there a more popular phenomenon at the moment? Maybe there is. Heard about NFTs? All of these phenomena are based on the blockchain technology, which made tectonic changes in the global economy, finance and many other fields. These tectonic changes led to what we have today, and that is: more opportunities, more options to choose from and more importantly – plenty of freedom. Whether it’s financial freedom, or simply freedom to choose decentralized money instead of traditional currencies, people now have access to the world’s hottest and most valuable assets, and all they need is Internet access and their smartphones, tablets or computers. Sounds like a modern era, doesn’t it?
But it is also a modern era in which it is really easy to get lost. What do we mean by getting lost? The answer is simple. After the first (and the most popular) cryptocurrency – Bitcoin, was invented, it was only the beginning. The beginning of a revolution in which thousands of cryptocurrencies have been invented until this day. At first, everyone was sceptical, only to realise that although volatile, Bitcoin, Ethereum and other crypto are good assets to have, and they can generate high returns, if you know what strategies to use and how to trade them. But if you’re a complete newbie in the field, chances are that you’ll get lost somewhere – whether it’s when or how much to buy, when or how or whom to sell – are pretty high! Even the most experienced crypto traders can be lost or overwhelmed in such a fast-paced environment and hectic market that crypto market actually is.
Why is this worth mentioning? Because mistakes can easily occur. By mistakes, we mean decisions or moves that are not that financially logical, or that may seem like a good idea at first, only to realize they weren’t really the right thing to do. According to research and according to professional crypto traders, one of the biggest mistakes you can make is to have paper hands. What are paper hands? This is crypto slang and if a trader has paper hands, it means that they sell fast, as soon as they see any minor inconveniences on the market. As you may already know, crypto always goes up and down. Does it mean that you have to sell every time the value of Bitcoin drops, only to save money? Of course not!
Does it mean that every time Bitcoin value drops, you need to purchase more Bitcoins? Absolutely not, either! The best thing you could do is to make a long-term strategy. A long-term strategy will help you have a bigger picture and keep your assets’ value on a consistent level, no matter the changes of the highly volatile market. This also includes diversifying your portfolio and having different types of assets, instead of putting everything you have into only Bitcoin, only Dogecoin, only Ethereum or any available cryptocurrency on the market. The opposite of paper hands is diamond hands. It’s someone who holds crypto for a longer period of time with a clear goal in mind and a good strategy. Diamond sounds better than gold, doesn’t it?
As we’ve previously mentioned, you shouldn’t buy more coins, specifically Bitcoin, every time its value drops. When we look at the history of Bitcoin, we can easily tell that the value of this cryptocurrency was drastically low, then drastically high. Then low again.
Something that is often heard is the fact that people who bought Bitcoin in the past, not knowing that it’s going to become this big, are now rich millionaires or billionaires. The majority of these people actually forgot their private keys so they don’t have access to their cryptocurrencies anymore. But still, they got a lot of Bitcoin when it was cheap. Does it mean you should do the same thing? In reality things are different. Spending money on bitcoin without any context, just to have as much as possible is one of the worst things you could do. Here are the top reasons why you shouldn’t be buying Bitcoin every time it’s price or value drops:
1. You Need to Posses Knowledge About the Very Currency
Although if my seem like crypto traders don’t know what they’re doing (you can often hear criticism of their wealth, lifestyles and work they do), in real life, the best trades posses a lot of knowledge, about the field, about the strategies and about the specific cryptocurrency they’re trading. You would think that the same rules could be applied to Solana, Bitcoin and Dogecoin. However, this is not entirely true. New technologies are replacing the old ones, new algorithms are on the stage, new trading platforms are being invented, and BTC is constantly being mined. That means that adjustments and a deep understanding of Bitcoin is something you need if you wanna make profit. If your goal is to simply have some coins in your digital wallet, to be able to tell your friends you’re a crypto owner, while actually losing money, then it’s a different story!
2. You Need to Understand the Market
As previously mentioned, you need to understand the bigger picture and the whole market. After you’ve gotten enough knowledge and found enough info about Bitcoin specifically, you need to understand the trends on the market and the history of the market to be able to find your place under the sun. Luckily, there are multiple podcasts, books and other resources for you to do research on the crypto market and understand the perspective of it, as well as: to be able to create accurate predictions that could actually help you gain money overtime. Simply holding BTC and ignoring the global events that impact the value of Bitcoin is going to lead to financial losses in the long run.
3. You Have to Know What to Do With Btc
But this doesn’t mean that you have to keep your Bitcoins in your wallet forever. It simply means you need to figure out what to do, whether to sell or buy your Bitcoin. There is no point in getting more coins only to have more coins. When the market is experiencing a big crisis it means that holding more bitcoins actually leads to losing money. You don’t want your assets to drain your bank account. You wanna do it vice versa. If you’re not sure where to start or how to handle the coins you already have, click here to take advantage of useful platforms and softwares that could help you out along the way!