Bitcoin Investing – Diversification Is The Key

Ever since its inception, Bitcoin became the most popular digital asset that shaked systems in line with the cryptocurrency disruption. Traditional players or investors are observing and steadily watching Bitcoin Revolution while aggressive or risk-taking investors jumped in at the frontline to the so-called “currency of the future”.

Bitcoin Market Price Behavior

The crypto market has been a very volatile ecosystem. Many people or companies have launced Individual Coin Offerings or ICOs which is like promoting a new stock but the crypto space is unregulated or unsupervised which makes it very dangerous especially for first-time investors.

However, during this time, Bitcoin went up to a market price of $20,000 per unit in 2017 but it declined in 2018. It then went to a rise and fall rhythm which made investors hesistant to invest in Bitcoin or other cryptocurrencies.

Bitcoin’s recent activity is now rising which attracted the attention of existing and potential investors. During the past years, people have seen the maturity of the crypto market as regulatory controls are now gradually being put in place by the government and financial institutions. As more institutional money or investments are pouring into the crypto market, the risks are also reduced while also eyeing a sizeable ROI.

Diversify Your Risks with Bitcoin

If your timing is right, you get to win big. However, you can lose it instantly as well. The key to be successful with cryptocurrency investments is to diversify your portfolio. You have to invest in several or a number of cryptocurrencies that are vouched by financial experts. It’s likeded to index investing wherein you practically can outperform the market.

You can’t just invest in one coin or ICO. It’s the same mantra as not putting all your eggs in one basket because you can lose it all when the market deflates just like when it did in 2018.

You should diversify and get as much leverage with different cryptocurrencies in one basket so you would have more chance to hit on investment tools that would perform well. This is how you diversify using the index strategies as popularized by Warren Buffet.