Spoiled by Bitcoin Volatility

Dramatic fluctuations, causing a roller coaster ride in the cryptocurrency market, have caused quite the heady rush for crypto-investors in past weeks and months. A 10 to 20% portfolio gain in a week is not unusual in this realm.

In fact, a 10% gain might even feel a little disappointing these days. After all, when you observe the insane gains and dips in the market, 10% does not feel like much of a shift in comparison. Last weekend, Bitcoin Cash gained more than 300% market value for a short time! It's easy to expect this to be the new normal after an experience like that.

It is this volatility that can cause impatience and hurt your investment in the long run. Wanting more "action", you might be tempted to flitter about, shifting one coin to another in the hopes of hopping on the right train at the right time. You can get lucky, but it is more likely you will be frittering away any gains in the normal up and downswings of the market. Not only that, every time you exchange coins, you are paying fees for each transaction, as they slowly rake away at your investment pool.

A 10% gain in a single week on a regular basis in any other investment would be considered absolutely insane. Most traditional investment portfolios would be extremely happy with that sort of gain in a year, let alone a week. Wait and watch - allow your money to work for you, and resist the temptation to waste money trying to make money.

Instead, if you want to be active in your crypto-investing, work at accumulating - not on a whim - on research and with regularly timed dollar-cost averaging - that is - divide the total amount you wish to invest long-term into smaller quantities and purchase what you believe in at regular intervals. This takes a ton more discipline and patience, but will result in greater gains over time.

*This is not professional trading advice. Only spend what you can afford to lose!

image source:

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