The One Cryptocurrency Investment Strategy You Can Win

In the dynamic world of cryptocurrency, the line between triumph and calamity often lies in your investment strategy. This is one surefire cryptocurrency investment strategy designed to maximize your winning potential.

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Cryptocurrency investment strategyPhoto byPhotodynamx | Dreamstime.com.

OK, first, I am not a financial advisor, and this is not financial advice. Always do your own research (DYOR) and never invest money you cannot afford to lose, as if there is such a thing. But seriously, too many allow emotions to rule their cryptocurrency investment strategy because they use money they can’t afford to lose.

Likewise, do not use your emergency funds to invest. This is particularly wise when investing in cryptocurrency, given its extreme volatility. If you need those funds for an emergency and the market is in a correction, or your preferred altcoin is down, you will lose.

#1 — Get a cold wallet & set it up before investing

The first step in any winning cryptocurrency investment strategy is ensuring your digital assets are safe.

A cold wallet is an offline storage solution for cryptocurrencies, rendering them virtually impervious to cyber-attacks. Regarding security, the common phrase “better safe than sorry” rings especially true.

Therefore, before plunging into the cryptocurrency market, secure a cold wallet and familiarize yourself with its setup and usage. Cold wallets such as Trezor or Ledger are reliable options to consider.

Trezor Crypto Wallet: Unboxing & Setup Beginner's Guide 🧐

Ledger Nano X: Unboxing & Setup Beginner's Guide 🧐

#2 — Invest an equal amount in Bitcoin (BTC) & Ethereum (ETH) with dollar-cost-averaging (DCA)

This step combines two crucial elements - diversification and risk management. Investing equal amounts in BTC and ETH offers a balanced exposure to the market leader and the leading altcoin.

Dollar-Cost-Averaging (DCA) further reduces risk and provides a balanced approach to investing. This strategy involves investing a fixed amount regularly (weekly or monthly) regardless of the price, which averages out the purchase cost over time, reducing the impact of short-term volatility.

I suggest BTC and ETH because they are well-recognized cryptocurrencies, and although still volatile, they are a better investment for beginners than most altcoins.

Investing in many altcoins that could fail before the next bull run could discourage the novice investor.

#3 — Never use margin money in your cryptocurrency investment strategy

While leveraging margin money can magnify profits, it also escalates risks, especially given the volatile nature of the cryptocurrency market.

I speak from experience on this one, so take my word for it. In 2019, I started investing heavily in Ripple (XRP). I had several thousand, and since the price was going up, I figured I could get a lot more cryptocurrency if I used my margin account to borrow against the altcoins I owned to buy more, sell at a hefty profit, and propel my investment.

Since I owned a lot of XRP, I used those to borrow and buy other altcoins. Then, in December 2020, the Securities and Exchange Commission (SEC) filed suit against Ripple Labs, and it all came crashing down.

I lost thousands of dollars, but I learned a valuable lesson. This is your opportunity to learn from my mistake. Don’t use a margin account with cryptocurrency. Altcoins are already too volatile.

A severe market downturn can trigger margin calls, leading to the liquidation of your assets at an unfavorable price. Thus, in our guaranteed winning strategy, we strictly advise against using margin money. Instead, only invest what you can afford to lose.

#4 — Use staking for ETH whenever possible

Staking is a feature of the Ethereum 2.0 upgrade that lets you earn rewards by participating in the network's operation.

By holding and staking your ETH, you get a chance to earn additional ETH as a reward, compounding your investment over time. Furthermore, staking promotes the holding mentality, discouraging panic selling during market downturns.

Shop around and know the in and out fees before you stake your ETH or other altcoins. Some claim high annual percentage yields (APY) but charge exorbitant in and out fees that eat your gains.

#5 — Have a realistic exit strategy

Any cryptocurrency investment strategy is incomplete without a realistic exit strategy.

Before entering the market, decide on specific milestones at which you'll sell a portion of your assets. These could be price-based or time-based targets. Sticking to this strategy helps capture profits during bull markets and safeguards against potential downturns.

Some expect to cash out a significant amount of crypto during the next bull run when they realize substantial profits.

Likewise, you can use specific targets, like money for a new car or home. Some consider this a pipedream rather than a “realistic strategy,” but with the extreme volatility of cryptocurrency, it has happened to many investors. Crypto has created many millionaires. Why not you?

Thirteen years ago, on 22 May 2010, Laszlo Hanyecz, paid someone 10,000 BTC to deliver 2 Papa John pizzas. Today, those 10,000 BTC would be worth $272,024,100. However, when you do sell, never look back, or you’ll end up kicking yourself in the butt every day, as I’m sure that guy does.

Final thoughts about a winning cryptocurrency investment strategy

In conclusion, the "guaranteed" win here isn't a promise of extravagant profits but rather the assurance of a structured, disciplined approach designed to maximize gains while minimizing risks in the unpredictable world of cryptocurrency.

My proposed cryptocurrency investment strategy promotes a long-term perspective, patience, and resilience—traits of every successful investor. Always remember, the world of cryptocurrencies is as much about the journey as it is about the destination. With this strategy, you're well-prepared for both.

An Excellent Cold Wallet

As stated in #1 above, purchase a trustworthy “cold wallet” and set it up before investing. IMHO, the best is the Coxmic Purple Ledger Nano X with Bluetooth.

Chainalysis identified $3.8 billion in cryptocurrency hacks last year, which is 15% up on 2021 ($3.3 billion) and dramatically up on the $0.5 billion stolen in 2020. — Kiplinger.

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DISCLAIMER: This article is for entertainment and informational purposes only. It should not be considered financial or legal advice.

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About the author

Stephen Dalton is a native of Old Town, ME, and a retired US Army First Sergeant with a degree in journalism from the University of Maryland. He is a Certified US English Chicago Manual of Style Editor. Top Writer in Travel, Food, Fiction, Transportation, VR, NFL, Design, Creativity, Short Story, and a NewsBreak Community Voice Pro.