25% Have Made Over $5K on Crypto — How Can You Join Them?

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How Much Do Americans Really Make From Cryptocurrency Investments? GOBankingRates recently surveyed 1,037 Americans in the United States to find out if they invest in cryptocurrency. Twenty-five percent of respondents surveyed said they have made more than $5,000 from crypto.

How can you join them and target $5,000 or more in cryptocurrency earnings? Here are some of the investment strategies used by crypto investors.

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DYOR: Do your own research

Cynthia de Wolf, marketing leader of DeFi startup Bright Unionhas been a crypto investor since 2017. While the Wolf’s personal portfolio is down 50% since the last All-Time High (ATH), the Wolf’s total profit is still over 100%.

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One of the Wolf’s recommendations to cryptocurrency investors, both new and existing, is to do your own research, or DYOR.

“Projects based on shaky tokenomics, cheap technology, flashy marketing and unsustainable incentives should be ignored,” de Wolf said. “The focus should be on serious projects that actually solve problems and deliver value to users in a sustainable way.”

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Buying and holding ‘Blue-Chip’ cryptocurrencies

Marlon Williams is the founder of Atlanta Blockchain Center, an incubator designed as a co-working space and learning center that will provide blockchain companies with the tools and resources to grow and scale in Atlanta next month. Williams recommends buying “blue-chip” cryptocurrencies and holding them for at least four years or more.

“Blue chips are established cryptocurrencies belonging to projects that have paved or paved the way for the industry through unique innovation,” Williams said. Some examples of these projects are Bitcoin, Ethereum, Polkadot, Chainlink, and Solana.

“As a new highly speculative and volatile asset class, buying and holding cryptocurrencies has been proven to yield the most effective returns over a number of years,” Williams said.

HODL

In cryptocurrency jargon, this acronym stands for “hold on for dear life”.

“Be patient and embrace the volatility,” said the Wolf.

Ignore the FUD

FUD is another crypto acronym that stands for ‘fear, uncertainty and doubt’.

“Ignore media topics that generate fear, uncertainty and doubt,” recommends de Wolf. “Go long. We do it for the technology.”

diversify

Just as you would diversify a traditional stock portfolio, don’t put all your eggs in one basket when investing in cryptocurrency.

“Forty percent to 50% of your portfolio should go into low-risk investments such as BTC and ETH,” said de Wolf. “Thirty percent can go to medium-risk investments: blockchains or protocols with huge market capitalization that have proven themselves.”

Williams also recommends investing in less volatile cryptocurrencies, such as USD Coin, and depositing in reliable, revenue-generating decentralized lending protocols, such as Aave Markets, Nexo or Celsius Network.

“These services accept deposits and lend them to other users seeking loans, charging a return that is then shared with the original depositors,” Williams said.

Buy the Dip

“Buy the dip” is defined as the principle based on the assumption that price declines are temporary anomalies that correct themselves over time, according to Forbes.

If you’re not sure if it’s the right time to buy, de Wolf recommends buying the Crypto Fear & Greed Index

Search and invest in small-cap cryptocurrencies

This is a risky strategy, but Williams said investors can try to find and invest in small-cap cryptocurrencies in a short span of time with the potential for astronomical returns. A good example of this are non-fungible tokens (NFTs).

“While this is not a recommended approach, some investors have made huge returns by essentially gambling away their hard-earned money with risky cryptocurrencies,” Williams said.

Never buy at a record high

Here’s a rookie tip from the Wolf who said never buy from ATH.

Protect your financial future

There are certain types of DeFi insurance aggregators that can help mitigate risk and protect against hacks or de-pegging of stable coins. Do some research to determine what coverage you should invest in to protect protocols or exchanges and to manage any active coverages in your crypto portfolio.

While there is no surefire way to guarantee income when investing in cryptocurrency, following some of these strategies can allow you to earn $5,000 or more in crypto income over time. Williams recommends never investing more than you are willing to lose and entering the crypto market with a little capital, discipline and patience.

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About the author

Heather Taylor is a senior financial writer for GOBankingRates. She is also the lead writer and branded mascot enthusiast for PopIcon, Advertising Week’s blog dedicated to branded mascots. She has been published on HelloGiggles, Business Insider, The Story Exchange, Brit + Co, Thrive Global and more media.

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