Posts

Crypto Investing Is Not For Prisoners Of Fear

avatar of @reonarudo
25
@reonarudo
·
·
0 views
·
2 min read

Image Source

Many years ago I tried to convince a friend of mine to invest a little bit in Bitcoin. This friend of mine lives off of his investments. From what he has told me, I've understood he's got enough capital to pay for his living expenses for two or at best three decades. Mind you, not indefinitely because he hasn't got enough to live only on the dividends his stock portfolio pays him.

That's not an ideal position to be in. I'm not going to go any further into his circumstances here. But if I were him, I'd try and supplement my income by working for two reasons: 1) in order to not have to dip into my principal and 2) to maintain a healthy routine - there are many ways to work and one way to work is by creating content and building a network on Hive.

I don't remember the exact year in which I recommended that he take a position in Bitcoin. But it is clear by now that simply HODLing he could've bought BTC at any moment, save for the last couple of weeks, and he'd still be in profit.

My friend told me he didn't like the "volatility" of Bitcoin. Fair enough. But without volatility there are no gains. And dividends usually amounting to 2-6 percent are so pathetic as to make a difference only in the course of decades if one is poor in capital.

Investing in network effects

Investing in something that benefits from network effects is the best possible path way to massive gains. A good examples of that would be being an early investor in a communication network of one kind or another.

The crypto space affords plenty of opportunities to become an early investor in communication networks. If this friend of mine had taken my advice and invested 1% of his portfolio in Bitcoin, which I presume to have been a few thousand dollars, he might be looking at having made 10x gains by now and perhaps 30-50x gains by the end of this year. He's not into social media or blogging or anything like that, which means Hive is not his cup of tea. But there are plenty of other opportunities in the space. But for anyone else in his position, becoming active on Hive would make perfect sense. Anyone who has a lot of time in their hands, might just as well use it by playing any number of the games on Hive and investing their winnings in HIVE itself or Hive-Engine tokens, some of which have had pretty stellar yields.

Fear of loss induced by volatility

@taskmaster4450 put it really well in one of this blog posts where he wrote that success is about fear management. Not making bad emotion-driven trading decisions is part of it. Fear management is a vital skill to learn. Some haven't and they will pay the price in lost opportunities.

Posted Using LeoFinance Beta