Some Useful Principles if You Are Just Into Cryptocurrency

Some Useful Principles if You Are Just Into Cryptocurrency

If you are just getting into cryptocurrency Investment or just about to, following the principles below will help you in this journey.

1. There is never, ever, ever, a steady run up to an all-time-high. If anything, Bitcoin crashes up and crashes down, until it eventually gets to the top.

2. Nobody knows where the top is and where the bottom is. Not big investors, not banks, not analysts, not redditors, not people who’ve been incredibly successful trading or holding their coins for the last ten years, not mathematical models. Anyone who says they know, and who makes predictions based on that knowledge, is either naive, or lying. Either way, they’re irresponsible.

3. Buying low and selling high only works if you can either see the future, or if you’re lucky. Nobody can see the future. Some people are lucky. Following the advice of a lucky investor, does not make you lucky too.

4. Buying coins based on expected price increase, or selling/shorting based on an expected dip, is a terrible plan. Unless you like to gamble, and you know how to gamble responsibly with money you can afford to lose.

5. There is only one responsible reason to buy Bitcoin and other cryptocurrencies: you believe in their long term potential, and you think the current price point is fair, given that potential.

6. There are several reasons to sell Bitcoin and other cryptocurrencies: you either don’t believe in their long term potential, or you believe they have potential but are overvalued, or you need the money for something with real value to you, in the real world.

7. Treating crypto as an investment will make you miserable as often as it makes you happy.

8. Watching charts will make you miserable as often as it makes you happy.

9. Reading threads about price point predictions will make you miserable as often as it makes you happy.

10. Reading about the technology, and its potential long term impact to the worlds of finance, economics, and decentralized software, is the absolute best thing you can do, to help you decide whether you should buy in or not.

11. The quality of the technology does not dictate the future price, at least not in the short term. The only thing that dictates the short term future price is categorically unpredictable market supply and demand.

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