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4 strategies to profit from a bitcoin crash

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Do you find yourself feeling anxious every time there’s a sea of red in the cryptocurrency price charts?

It seems that every time Bitcoin’s value drops in price, it causes most investors to panic.

You can expect a lot of people saying that the bubble has finally popped, encouraging everyone to sell their digital coins before things get too late.

It’s worth understanding, however, that a crash can be just what you need to increase your profits. A significant drop in price signals an excellent buying opportunity. Keep reading to learn how you can profit from a Bitcoin crash.

Buy the Dip

When you look at the price chart of Bitcoin over the past year, you’ll see a nice upward trajectory. While the beginning of 2018 isn’t anything like that of 2017, Bitcoin still enjoys a relatively stable price. This only shows that many investors continue to believe in the digital currency despite all the government regulations, bans on exchanges, and other bad news.

A dip in price shouldn’t scare you. Instead, it should entice you to take action. Buying the dip is a simple way of making gains in the cryptocurrency trading world. Be careful not to overthink. Remember that it’s impossible to time the market. But if the price drops without any negative news, you can assume that it’s only going back up. To make things more manageable, use a trading robot like Crypto VIP Club so you can ensure that you’ll get some coins every time there’s a dip.

Explore Promising Altcoins

Bitcoin is the most popular cryptocurrency, but you’ll increase your earning potential by learning about other coins. As an investor, you should find quality coins that show the most promise. There are cases in which a popular coin drops in value because a new coin with similar features suddenly makes people realize that it’s the better investment. Don’t forget to check the company behind the coins you’re investing in as well as their team of developers.

Hodl

Hodl is a term you’ll hear from countless cryptocurrency investors. It refers to holding on to your coins even when their values drop. It doesn’t get any easier than this strategy. Even if the value dips below your buying point, you may still want to hold on to your coins and just wait for its price to increase again. You should realize that a crash doesn’t mean you always have to do something. Sometimes, the best thing to do is nothing. Hodling coins with the biggest market capitalization is often a safe investment decision.

Consider Shorting Bitcoin

This one’s a little trickier than the others. Many traders utilize this tactic with varying levels of success. When done correctly, however, you can enjoy huge returns. There are some exchanges that offer this feature. Shorting Bitcoin means borrowing it from somebody, selling it, and buying it again so you can return it to the person. You’ll earn some nice income if the price drops.

As you can see, some of these strategies prove riskier than others. It’s up to you what to use based on your abilities, knowledge, and risk tolerance

Source: www.bmmagazine.co.uk