Rethinking Crypto Investments - You have to Join Me!
Cryptocurrencies were a 21st-century innovation that came with a lot of promises. It was a promise of anonymity for some, better intercontinental monetary operations for others, an unsung promise of quick money for the majority, and a promise of a better store for their wealth, in other words, a better investment opportunity for others.
Looking at the basic definition of an investment, cryptocurrencies seem less promising as a good investment (pro-cryptos, please hear me out). An investment in the most basic and universal sense is something which should be able to profit generate profit over time. The keyword is "profit".
This means that if one invests his money, time, efforts or other valuable resources, they should be able to make some money from it.
That has been true for cryptocurrencies, and also has been a lie as well. Cryptocurrencies seem like two sides of a coin, on one side is profit, and on the other side are losses.
Remember flipping a coin, you never know if you will get the head or the tail, you just hope for the best, while expecting the worse.
Cryptocurrencies have Defiled Economics as We Know it
Studying economics in school does not guarantee in any way that you will understand the fundamental nature of cryptocurrency economies. The basic law of demand and supply does not really play out as we all know in the crypto space. The microeconomics which we can't really lay our hands on impacts it more than the macroeconomics which is economics as we know it today.
Bitcoin has continued on a downward trend since the end of last year and nothing has changed since then, and with most persons having high hopes for Bitcoin, we have come to see that no cryptocurrency is invincible, and even lately we are seeing the failure of stable coins. You may provide an intelligent guess to explain the downing of Bitcoin, but you cannot provide the full picture, as there are some things hidden behind curtains and behind algorithms.
While crypto has earned itself so much growth over the past decade and beyond, it is still really an immature system that moves with every slightest wave. Most persons invested in crypto, fully do not understand how it works at least 60% of its workings and trust me, no one fully understands. The unregulated amounts of crypto-based projects cropping up only worsens the situation.,
Most people have followed the crypto wind as it blows, most losing money while few others (most whales) making money.
Be Crypto Smart
Cryptocurrencies are one of the most revolutionary technologies of our time, and they have not failed in any manner. They offer investment options as well as other business alternatives that were previously unavailable. However, we cannot rule out the possibility that in our pursuit of crypto wealth, most of us have lost more time, money, and effort than we have gained.
Owing to this, I advise that we take a more rational approach to cryptocurrencies. Instead of HODLing (hold for your dear life) coins and hoping that one good day, the crypto you got for just 10$ will yield 1000$, why not take a more realistic investment? Trust me, crypto has the potential to make something out of nothing, but look closely, they are all exceptional cases. Crypto is money, and making money is hard, if you managed to make it easy, you are an exception.
Short-term realistic investment options include exploring liquidity pools, yield farming, exchange-based investment options, and more.
Your meme and shit coins may eventually turn into trash. Resist the urge to invest heavily in projects that are kinda opaque or misdirected. These projects will usually live the hype, and over time, they gradually fall down, even Elon was unable to get Doge to the moon, with his plethora of rockets.
If you don't understand it, do not invest. In fact, if you cannot explain your reason for investing in a particular crypto project and the workings of that project, refrain from it.
How Long Should you Hold an Investment?
Sometimes, we become too greedy that we eventually lose out on what we have, and blame crypto for it. Investments should be calculated, and the wait and drive for the All-Time High should be resisted.
The All-Time High wait is killing and hurting your crypto portfolio. If an investment should give you more than 10% of invested funds within a few months, it is more than good enough. Stop waiting to go for the moon.
Another issue with our crypto investment moves is that we do not keep good records, we quickly forget what we invested, and focus on how much we want to earn. Imagine making an investment of $10 which eventually grew to $50, but the market crashed on us, and the worth is now $30, most persons will be hesitant to make a withdrawal, feeling like they have suffered losses. But is that actually a loss? We should be more calculative and take our profits early, than wait for the moon.
Cryptocurrency is challenging yet intriguing. Its length and width are not completely understood by everyone. Even if you fully comprehend how it works, never bury both legs in the sand since you never know if you will emerge unscathed.
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