Bitcoin skyrocketed to $40,000 on the 7th of January 2021 before plunging back down to $38,000 just 5 days later. This has left many crypto traders wondering if it’s time to exit, and others wondering if it’s the right time to buy. At this point, it’s just an avalanche of “should Is?” with so many conflicting responses. But we understand. Crypto trading can be overwhelming, especially for newcoiners. But if there’s something we’ve learned from trading bitcoin over the years, it’s these 3 things:
- Do your research. As with any investment, it’s important to understand what you’re getting into. We did a poll during the bull rally asking our followers on Instagram their reasons for joining crypto trading at that time. One of the options was “because everyone was getting into it”. Why that is a good reason, it is also important to note that just as bitcoin smashed its own record and then doubled that in barely 3 weeks, it can go back down at any time — as we saw a few days later. But if you pull your funds immediately there’s a decline (just like in April 2020), you might regret it when it goes back up.
So before you start trading, look at it from all angles. Read up on everything bitcoin from trusted resources, and then choose an exchange platform you can trust (like Patricia) to start trading.
- Start small. When starting off crypto trading, test the waters first. Don’t be greedy and put all your eggs in the basket, so to speak. Use what you can afford to lose. We advise you to start with a tiny percentage of your net worth and then grow from there when you begin to fully understand what crypto is about. That way you can sleep well at night, and not spend every day monitoring bitcoin trends and having minor panic attacks whenever it fluctuates.
- Patience is key. It may take days, months, or even years to profit from trading bitcoin but the truth is, you will. If you get scared every time it looks like Bitcoin is taking a dive and sell everything you own, you might just be the biggest loser. 7 years ago (in 2014), 1 BTC was about $920. Currently, it’s sitting at $37,000. Imagine you bought BTC 10 years ago. In December 2020, BTC was at $25,000, by January 2021 it exploded to $40,000. Imagine if you sold in December.
Unlike Fiat which has fallen drastically over the years (for example the Nigerian Naira), you can trust in bitcoin’s store of value, and make the best decision when it comes to trading.