hello world!
When it comes to crypto, there are a lot of users who simply jump into the fray without thinking. They fail to plan out a strategy or determine a method for how they plan to buy, sell, or trade. Of course, there are times when even the best-laid plans go awry, but everyone should have at least a basic plan before getting in too deep. Something like dollar cost averaging.
Keep in mind, everyone will use a different strategy, suggesting when it’s time to buy and when it’s time to sell. Every user will have their own unique goals and intentions. However, there is a large swath of people whole like to use the dollar cost average (DCA) method.
Many people like this method because it’s flexible and adaptable. Maybe you’ve heard of dollar cost averaging, but you want to know more before you start using it. We’re going to tell you what it is, how it works, and some of the benefits of using it.
When people talk about dollar cost averaging, they’re referring to a strategy used to purchase various types of financial assets. These include stocks, bonds, commodities, and, yes, even cryptocurrencies. The actual financial product doesn’t matter, especially since the strategy itself is simple and easy to apply to any type of market.
For Dollar Cost Averaging, the method is actually about a certain amount of a pre-determined financial asset at a given point in time. Using this strategy provides immediate oversight into how your assets are performing while removing emotion and reaction from the equation, which can be tough when watching the ups and downs of the crypto market.
When using DCA, the expectation is that the selected asset will show an increase in value over time. When you buy at given intervals, you’re purchasing the selected asset regardless of whether the purchase price is high or low. Following this method should result in an average buying price, which is typically lower than the actual value of the financial asset itself.
What many people don’t know is that Dollar Cost Averaging is a popular method used within the crypto industry. Keep in mind that the crypto market is still fairly nascent and is subject to significant highs and lows. With that in mind, if you’re new to buying Bitcoin, Dollar Cost Averaging might be a good strategy to use.
As the Bitcoin market continues to gain adoption and develop, the potential for growth is significant. Of course, you should always do your own research before you purchase any asset, whether it’s Bitcoin, another cryptocurrency, or something else entirely. Knowing what you’re buying will give you the confidence you need to stick with the product over the long haul.
So, how does someone get started with the Dollar Cost Averaging method? Most users simply purchase Bitcoin using a set amount of money every month. Usually, this is part of a person’s salary. As a result they get used to the amount being withdrawn and used to purchase Bitcoin. It’s really that simple.
If you want to use DCA, you might want to ask yourself a few questions first.
For starters, which crypto do you want to use? Since Bitcoin is the most popular cryptocurrency, it makes the most sense for the majority of buyers. It’s easy to access, is available through most exchanges, and is one of the more stable digital assets in the market.
You’ll also need to determine how much you plan to spend and how often you want to purchase. Some people make it part of their paycheck withdrawals, so they adjust to the amount not being there. Additionally, you might want to consider whether you want to make the transactions yourself manually or set up an automated purchase.
If the safety of DCA is a concern, there’s not much to worry about. However, there are a few things to keep an eye out for as you purchase Bitcoin. For example, Dollar Cost Averaging is a method that benefits those who are looking to hold their Bitcoin over the long term. For those trying to make a quick buck, DCA won’t get the job done.
Additionally, there’s no guarantee of a positive return when using Dollar Cost Averaging. This is also true of the crypto market as a whole, so only use funds that you can afford to lose.
There are many advantages to using the Dollar Cost Averaging method. One benefit is that you aren’t letting your emotions dictate your actions. The crypto market is very volatile - it is subject to significant highs and lows at very quick intervals. When you use DCA, you’re looking at the big picture and not letting your feelings control your behavior.
Another advantage to using Dollar Cost Averaging is its simplicity. Whether you’re a crypto novice or an experienced user, DCA can be a great way to systematically add Bitcoin to your wallet. You don’t have to understand the ins and out of buying and selling to use this method. It’s simple and easy to implement.
If you’re considering Dollar Cost Averaging as a method to use for buying Bitcoin, a Bitcoin ATM is a great way to manually do so. Set a reminder on your smartphone to head to your local Bitcoin ATM and buy some BTC no matter what the price. With DCA, you’ll already have a set amount you’re spending. Plus, a Bitcoin ATM is a fast, secure, and simple way to add Bitcoin to your wallet.
There are plenty of Bitcoin Depot ATMs available throughout the United States and Canada. So set your alarm, and visit one today to put your Dollar Cost Averaging plan into action.