5 months ago
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Owing to the volatile nature of the crypto market, anyone with a substantial investment is bound to ponder on the right moves to make per time. Do you buy more, do you sell immediately, or do you keep holding. These questions, as straightforward as they sound, are not easily answered. Lots of analysis and consideration goes into the process.
To begin with, we’ll highlight the ideal reasons people buy crypto in the first place, which will help inform your investment decisions. We’ll also bring you profound circumstances where you should sell drawing expert tips and past trends.
Reasons to Consider Buying Bitcoin and Other Crypto
Aside from the obvious reasons to make profit and diversify investment portfolios, there’s a lot more to buying crypto assets. From an industrial and economic standpoint, there are some solid advantages to buying in on the right crypto currencies. Moving on we’ve highlighted some of the most solid reasons.
Long Term Growth Potential
Bill Gates, Founder of Microsoft – “Bitcoin is a technological tour de force.“
If you have been treading the crypto market, you’d know that there are basically two solid ways to make significant gains. The first one is leveraging short term volatility to either buy or sell and the second is accumulated profit over a longer term. Buying and holding when you suspect a long term growth potential is never a wrong move.
However, long term crypto investments are always dicey. According to a 2023 CoinGecko report, 90% of cryptos launched since 2014 haven’t done very well in the long term. So you may have to stick to assets that have already shown massive potential. These include;
- Bitcoin (BTC)
- Solana (SOL)
- Ethereum (ETH)
- Litecoin (LTC)
Increasing Institutional Adoption
Vitalik Buterin, Co-Founder of Ethereum – “If crypto succeeds, it’s not because it empowers better people. It’s because it empowers better institutions”.
It is difficult not to notice the growing adoption of crypto assets in major industries. Both as a payment method and as an investment portfolio, more and more people are buying into the essence of a virtual currency. This gives you another solid reason to own crypto assets. Essentially, you might not know when you’ll need them with the current trajectory.
Some of the most crypto-friendly industries include e-commerce, banking and finance, art and entertainment and iGaming. Talk of iGaming, casino gambling in particular heavily adopts crypto tokens as payment. Even with low deposit casinos where users can explore gambling with a $5 deposit, cryptocurrency is very prevalent. Especially, it is very easy to withdraw your winnings in cryptocurrency. And sometimes takes from a few minutes to a few hours.
Hedge against inflation
Especially with stable coins, crypto assets can offer a degree of insulation against inflation. This quality stems from certain unique characteristics cryptocurrency embodies. These are primarily its limited supply or scarcity and its decentralization and independence. However, crypto’s overall utility as an inflation hedge still depends on the market conditions to some extent.
When should I sell my crypto or hold
As promised, we’re rolling out some hardcore events and circumstances where you should almost certainly sell your crypto. Most people aren’t overly concerned about how to sell crypto. It is the ‘’when’ that seems daunting.
In addition, while this is an expert perspective , we wouldn’t want you to treat it as financial advice.
Fun Fact: In 2010, a programmer named Laszlo Hanyecz bought two pizzas for 10,000 BTC—worth over $600 million today!
Persistent lack of developmental progress
When crypto tokens are launched, they’re usually surrounded by a lot of buzz, engineered by utility. And sometimes, it is difficult for developers to retain that same level of utility and development, not to talk of getting better. You should be selling your crypto asset if there is no noticeable advancement or positive market trend in some time.
When you hit your profit target
Typically, most crypto holders especially in the short term only want to realize 2X to 3X their entry cost. If you set profit targets like these, then it is advisable you pull out when you realize your profits. Selling when you hit your target ensures you do not hold out for too long for the market to turn on you.
Also, taking profit when due gives you the avenue to re-strategize and reinvest your profits elsewhere, with something newer.
A spate of negative news
Just like every other industry, sales and stock prices in cryptocurrency are heavily affected by negative news. If you are fortunate to see it coming, you should always pull out and buy back later. In the crypto world, this could be a legal action, a major shareholder intent on selling, etc.
Usually, the threat of terrible news is usually more devastating than the event itself. As such many people in the market will react to any news of impending doom. You shouldn’t be the only one left.
Why many choose to HODL
Even in the midst of losses, uncertainty and a market plateau, a good number of crypto holders do decide to HODL and wait out the storm. While that may sound ideal and proper, it is important you know the reasons behind this stance. Firstly, most hodlers have resolved to only HODL investments they can afford to lose.
Secondly, if they’re already at loss, most people would just prefer to maintain the portfolio in the hopes of the market going their way one more time. Lastly, many people use crypto assets as an alternative savings account. In essence, just to store a portion of their liquid assets. In this case, hodling comes naturally as they have no intention of selling soon.
Fun Fact: The famous crypto term “HODL” originated from a 2013 Bitcoin forum post where a user misspelled “HOLD.” It quickly became a meme and investment strategy.
Conclusion
In summary, should you sell your crypto or wait for a rally? Depends on the variables we have covered in this piece. In some cases, selling is all but necessary. In other cases, selling too soon or not at all may be of major disadvantage.
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