Many investors, as well as professionals, have made cryptocurrency investment a part of their portfolio. Most of the people today are just into “trading or merely buying” the cryptocurrency, they do not tend to “invest” into it. You might be wondering, now what’s this trade / buy vs invest in crypto? So let’s talk about it.
The high market volatility of crypto is an opportunity to make some quick money, but many over 95+% end up losing or not having a good experience, as they get wrong with the timing around mere buying and selling of crypto. Even the most professional traders get the timing wrong as the volatility could play against it many times.
Cryptocurrency trading is the act of speculating on cryptocurrency price movements , by buying and selling the underlying coins in hope of making some short-term quick gains. This method requires you to carry an in-depth knowledge of trading, track news updates and price movements as they say only the super smart ones win. For example - China banning crypto could send immediate shock waves in the market and only the most prowess traders will be able to respond without losing money. This method is a double-edged sword as this can lead to complete loss during both bull and bear markets based on which side of the market you are betting against. Cryptocurrency risks are as real as they can get. So, we should weigh the risks and goals that suit us the best.
Investing on the other hand involves doing some in-depth study and betting on the fundamentals of the coins. In the Crypto world, fundamentals typically mean looking at the right network protocol, technology, application, token economics, software development team, number of users, integrations, legal concerns, etc.
There are multiple strategies in investing:
In simple terms, crypto exchanges today offer a platform for you to trade crypto, but, if you’re looking to invest in crypto there is Crypto Smartlife that can help you invest in crypto.