Long-term investment in cryptocurrency
We at Firi believe that cryptocurrency is the currency of the future, suitable for savings and investment. This is how Maren decided that buying crypto for long-term investment was the best thing for her.
Read more about saving and investing in cryptocurrency here.
Interest in cryptocurrencies has exploded over the past year. Most of the enthusiasm around cryptocurrency, especially Bitcoin, happens when there is a so-called “bull market”, i.e. an upswing in the market. Market movement is often intensified by increased media buzz, especially when those who have profited from their investments are interviewed and there is a good mood. As a result, more people are opening their eyes to crypto, and we are seeing a significant increase in trading volume. In the crypto world we call this FOMO - fear of missing out.
“It’s easy to base your investment strategy on historical data, but this doesn’t guarantee future returns,” says Aleksander Hyggen Haarstad, a data analyst at Firi.
By this he means that we cannot say with certainty how the market will move, such as when it turns and becomes “bearish” or what we call “bear market”. There may be small nuances and in the blink of an eye you’re reading the headline “Bitcoin plunges again - Experts warn against cryptocurrency”.
In the crypto-community, FUD - fear, uncertainty and doubt - spreads and while some shout HODL (hold on for dear life), others shout that it’s time to sell out. Who should you listen to? What is best practice?
It can be challenging to balance everyday life with the emotional rollercoaster that crypto investors are on at any given time. Fortunately, there is a good alternative toactive trading: Long-term investments and goals.
“The advantage of a long-term investment is that you can ignore the fluctuations that affect the market over time as they can be frustrating and time-consuming to understand. Meaning you’re less emotionally affected by price fluctuations and short-term uncertainty,” explains Aleksander.
Aleksander Hyggen Haarstad, Data Analyst at Firi(formerly MiraiEx)
Cryptocurrency instead of candy
It is perfectly normal for the crypto market to go through cycles of bull and bear periods, but it is still difficult to know when peaks and troughs will hit, even for experienced traders. That’s why most people, including Firi co-founder and UX designer Maren Kleppan, choose long-term investment.
“Having been an emotional wreck for months after my first investment in bitcoin in 2019, I’ve found that it suits me much better to instead invest a little every single Saturday. Instead of beer and sweets, I instead deposit a small amount into my Firi account, and buy crypto there,” says Maren.
The investment strategy she has used is what we at Firi call Crypto Savings. Meaning Maren chooses how much she wants to set aside as savings, which cryptocurrencies she wants to invest in, and when to buy. The concept is similar to the Dollar Cost Averaging investment strategy where a larger amount is divided into equal parts and distributed over a specific period. You can find a modeling tool here showing you profits and losses on investing in bitcoin regularly over time.
Historically, it pays to save in cryptocurrency
Before Maren started at Firi, she had limited knowledge of cryptocurrency, which is also why she waited to invest.
“I used my colleagues actively to learn more about crypto. Knowledge of what cryptocurrency is, especially the technology behind it and the goals of the individual currencies, is incredibly important when investing in cryptocurrency. It’s why I’ve invested in bitcoin, for example, because I have familiarized myself with it and believe one hundred percent that it will be part of the global monetary system until I shuffle off this mortal coil,” she explains.
When Maren made her second big deposit, it took no more than a couple of days for her everyday life to be turned upside down. The corona crisis hit, and all crypto-investors saw red numbers for a long time. For Maren, this hit particularly hard as she had invested a large amount of her savings.
“Suddenly the trend reversed again, and the line went up. That’s when I got tips on selling, which is exactly what I did. Loss. I bought in again, and tried to keep my cool. It was tough. It often felt like having a small heart attack every time I checked Firi, and I was very stressed. That’s when I decided to ignore the short-term peaks and troughs, and focus instead on the fact that my investment is actually long-term.”
Join over 200,000 other nordic investors and start your cryptocurrency journey today!
Historically, investing in bitcoin has paid off. Almost regardless of when you invested, whether it was on a peak or a trough, you will have made a profit in the space of two years. You can see how the price of bitcoin has developed here:
Source:Tradingview
We always recommend DYOR (do your own research) and never investing money you can’t afford to lose. You can read more about saving and investing in cryptocurrencyhere.
This content is for informational purposes only and should not be construed as financial advice. Remember that buying and selling cryptocurrencies involves high risk, and that historical returns are no guarantee of future returns.
