How to get started investing in Bitcoin and other Cryptocurrencies
Recently, I had the pleasure of interviewing a friend of mine Rob Kishi on Bitcoin and other Crytocurrencies. During this interview Rob gave us an insight on the basics of cryptocurrency and revealed that his strategy was to hold most of his stake in cryptos instead of trying to sell and make a quick buck.
Rob's strategy makes sense for two reasons:
- If you truly believe that Bitcoin and other cryptocurrencies are the future, why sell? Back in November of 2013, Bitcoin went from $350-$1,242. Imagine if you owned 10 Bitcoin back then that you bought at $350 a piece. If you sold all at $1,242, you could cash in with almost a $9,000 profit. That sounds great, but if you instead were to hold on to that same 10 Bitcoin, it would be worth $174,899 as of right now. That is more than a $170,000 profit.
- If you hold your stake for longer than a year, you typically will pay 2.5x less taxes on your gains.That means you can reinvest more money each year and continue to grow your wealth.
In conclusion, if you are new to cryptocurrency please do not jump in to make a quick buck. The people who do typically are the ones that lose the most money because they do not believe in their investment and are not patient enough to see it through. At some point, the crypto market is going to go down. Everyone will go from manically buying to panically selling. The investors who have done their research and believe in their investments will not sell, they will actually buy more and grow their coin portfolio.