HODL stands for “Hold On For Dear Life”, which is precisely what it feels like to leave cryptocurrency invested. The urge to trade, exchange or cash out crypto can be driven by the strongest feelings of impulse in the finance world. Why is this the case? Crypto is more volatile than traditional investing, which creates more opportunities to profit. If you’re invested in one product like Bitcoin, Ethereum or Ripple (the prominent three cryptocurrencies), other currencies, coins or tokens suddenly spike up, and you want your price of the pie.
Similarly, it’s as if you’ve got a beautiful piece of lemon meringue pie on a plate in front of you, side of coffee and all the time in the world to daydream your day away, but then something catches your eye. A conveyer belt runs more pieces of pie past you with Blueberry, Apple and Cherry pie wafting scents of flavour into your nose. The warm smell of pastry and fruit is tantalising. You want it all. So you reach out to get it; meanwhile, your lemon merengue plate is cleared by a server. Greedy move. Rookie manoeuvre in the pie game. The lesson learned is; work with what you have until you are finished, then go and get more pie.
With this idea, the pie is crypto, and the conveyer belt is the internet, pumping the concepts of profit, Lambos and price jumps to the moon. Some of that could happen, but not without some carefully planned steps and some consistent work put in. What can a person do to profit and not be overwhelmed with options causing your mind to explode due to FOMO? (fear of missing out). Pick a few ways to start building your portfolio the correct way. HODL. It’s a simple concept, but you have to define different ways to do it. Here are some tips and tricks to save your bread n butter of crypto.
Firstly, HODL something that has been around for a while. Or something that is almost worthless that will become increasingly valuable. Bitcoin is a solid investment. Something as a more risky investment would be a coin worth less than a few cents each, so you can hold it without worrying about volatility. If it jumps in price, hold it or cash out. If it dives down, well not a huge loss. You should weigh the risk vs reward. Find ways to measure this with your investments. And never risk more than you can lose. Decide on percentages of your investments which will be in crypto. If you choose 100%, you’ve made a mistake. You need to diversify and keep funds available for new opportunities.
Second, Never HODL in an exchange. Find an offline wallet or private wallet on your computer. Backup your private keys and leave it. HODLing really should define a timeline. In my books, six months doesn’t qualify as HODLing. Try a year and beyond. HODL in cold storage. Trezor. Ledger. Paper wallets. Check out our other article about these products on our website. The idea is that if you have crypto stored in an offline wallet, then it can’t be hacked and it will be less accessible for you to trade it.
Another option is to HODL in your local currency ready for the bottom of price drop. Many people are currently keeping their funds in exchanges prepared to pounce on opportunities. This may not qualify as HODLing compared a long term strategy, but this does enable a quick buy on crypto that is priced right to make some profit. If you are going to have funds held in an exchange, you can take advantage of some options for stabilizing your funds during volatile times, or if you want to unplug and not worry about your investments. The canadian company coinsquare.io offers to exchange crypto into CAN or USD. There is less volatility in FIAT currencies, so this becomes a quality safe-haven to work with your financial plan. Not a bad place to keep your piece of the pie while others ride prices down like a bunch of rookies.
HODL in Tether. USDT or Tether is a cryptocurrency that doesn’t fluctuate much because it’s backed by the mighty US Dollar with one USD held in reserve for each USDT. This may change in time, but for now, it’s a decent place to hold funds in an exchange if you are waiting to invest in bargain prices of crypto. Check the charts. USDT is all horizontal. The exchange Bittrex recently added USDT, which is an incredible way to round out their services. It’s like burying your money in a hole in the ground, but not having to dig it back up.
In truth, you should already know that all money held in exchanges is not very secure, but we all know that it is a necessity. Just keep in mind that if you want to keep your money for long periods of time untouched, don’t leave it in an exchange.
So how is your financial plan shaping up? How is your separate cryptocurrency road map? Plan where you want to be, continue to learn and educate yourself. We are all more than capable of taking a few tips and tricks such as these, sharing them with our colleagues and all benefiting with some tasty profits. One last point of advice; celebrate your profits with a real piece of pie and continue making your financial plan.
By Ross Macdonald – Copywrite CryptoCulture Magazine Inc. 2018