I think giving disclaimer is the first thing you should do when you talk about money online, so this is not a financial advice, just a “noob’s” opinion who literally just started investing in crypto today.
I mean, I had installed apps like WazirX & CoinSwitch but I never really invested any money in it – partly because I am not a risk taker.
And crypto is … risky!
The other ‘small-and-very-insignificant’ investments I have are in – NPS, PPF, Gold ETF, Index and other mutual funds.
So, you can guess the type of “investor” I am – definitely not a risk taker!
So, why did I put the little money I have in an instrument which has a VERY high chance of loss?
Because blockchain is the future! And Bitcoin is the one driving it.
Yes, it is not very popular right now… especially in India where you pay flat 30% tax on the profits you make on crypto but eventually, people of India will realize it and the government will have to make changes to their policies.
I mean in the west they have Bitcoin ATMs where you pay not by the money in your account but by these Bitcoin Wallets – it’s fast, convenient and eliminates the need of complex banking systems.
And the best way to make money is by investing onto something when most people are hesitant about it.
I know I am at least 10 years late to this and jumping into it when Bitcoin prices are at all-time high, but that’s the beauty of it – there will be another “All-Time-High” & I want to be a part of the group who profits out of it.
(also, I don’t want to Jinx it)
Anyways, I am not a risk taker as you know right – so today after spending some hours, I came up with a simple strategy that feels pretty nice to me as of now. These are few points I have written and would love to follow them:
- Use a Exchange that is known, I use CoinDCX because apparently it is the “largest” one in India rn. (btw, the previous “largest exchange” had a cyberattack last year which wiped $230 million of users money)
- I will not deviate from these two coins – Bitcoin & Ethereum as these are the largest ones. And in case, everything goes haywire these two are the only ones which can sustain it!
- I am planning NOT to move my coins to wallets like MetaMask to “explore the crypto world” because there is a “transfer fees”.
- I would prefer to treat this as a 4-year-plan where I am pretty sure I will be seeing a lot of “red” in my portfolio.
You see, making money with crypto or with any money instrument is not a one day or one week thing – you have to be PATIENT, which brings me to the next point… - I plan to invest money and NOT CHECK IT DAILY if it has grown or not!
- I plan to be PATIENT and only sell it during a bull run.
The thing is in crypto if you sell it at a loss of say Rs 2000, that Rs 2000 is gone, you are bearing it.
In stocks, you can write off your capital losses with capital profit …not in crypto.
And most importantly, you bear the profit/loss, you pay the 30% tax only when you sell…not when you hold. So, be PATIENT and HOLD! - And finally, if you’re a beginner or low-income individual like me 🥲 – NEVER invest the money you know you would be needing in short term in crypto for quick gains. It should always be the “extra money” you have!
And all of this, I am doing it in 60-40 ratio – 60% of that money in Bitcoin and 40% in Ethereum.
So you see it’s like a mutual fund only…just not regulated! 😁
And during my research, I also found this plan of mine is useful only if I plan to invest less than Rs 20,000 in a month.
If you have a higher number in your mind, checkout Bitcoin ETFs!
I will explain that it in some other post I guess.
Cheers!
