There's a common perception I have heard from many people and friends who aren't into cryptocurrency, and that is the perspective that engaging in crypto means trading crypto, similar to how most people view the stock and forex markets.
But today I'm writing to explain that trading is just one way to experience crypto! This is an article for everyone curious on the outside looking in, who have come across the concept of cryptocurrency but don't fully understand that they can invest without having to trade.
When we think of the stock market or the forex market, we think about people consistently day trading and flipping stocks or currencies to make profit. And this is very true for crypto as well, as many traders exist within the crypto space, some who do insanely amazing, and some who get 'rekt'.
When I started out in crypto in 2017, I got into trading as I saw it being "the way". Since then I've discovered a better system for myself (and most others I'd assume), which is buying, earning, accumulating, and holding.
In the crypto-verse, we have a very popular term you may have seen, HODL, which stands for "hold on for dear life!" As opposed to buying low and selling high, we would rather just buy low and hold our investment.
(There's always a potential to sell some for profit, but this could be a few times a year experience, not the same as consistently trading back and forth daily or weekly.)
What are the benefits of HODL'ing versus trading for those new into crypto?
- You won't lose your investment due to lack of trading skill or emotions.
- Your crypto will stay safe, and will be there despite the ups and downs in the market. i.e. peace of mind!
- Your mind can focus on gaining more crypto and constantly adding to your pot and net worth.
- You'll escape the capital gains taxes which must be paid every time you make a net profit on a trade.
- Instead of trading, you can stake or lend your crypto, allowing you to earn more crypto with much less risk than trading.
Professional traders definitely make money, but you must remember, these guys have lots of experience, which means they've made losses in the past in order to learn and get to where they are.
Trading and market knowledge does come in handy though when wanting to swap or trade one crypto asset for another, as paying attention to prices between the assets helps you make the best trade possible, but this is not nearly the same as being a "trader" who is constantly looking at charts 24/7 and trading back and forth.
If you want to get involved in crypto and stay safe, the easiest way to do this is to become a HODL'er and either earn some online, or buy some Bitcoin or Ethereum from a popular exchange, and send it to a wallet which you own the private keys/seed phrase for. (Ledger Nano X hardware wallet / Exodus wallet / Bitcoin.com wallet, etc)
Then just HODL it for the long term, no trading required!
Much love, and I hope this helps you on your crypto journey!
