Whether you are a recent or expert cryptocurrency investor, the recent changes in crypto values would have undoubtedly caught your attention. From Bitcoin to XRP, markets are experiencing significant upsides and downsides daily. Therefore, this begs the question of what decision would be the smartest for an investor in the current crypto market. There are multiple sides to your options as an investor. You can decide to hoard your coins or sell them to cash out. This article will duly examine these options:
What is Crypto Hoarding?
Crypto hoarding entails a combination of buying more crypto assets and holding the assets with the expectation that the price will increase in the coming weeks or some cases, years. In crypto language, this action is referred to as “hodling.”
Because cryptocurrency is an extremely volatile asset, hodling often requires patience. Often, world events may significantly reduce the asset’s value, and you will make losses while holding on to the asset. This volatility is why the timeframe for hodling crypto often spans a relatively long time and requires a lot of patience. Patience is the major route through which you can optimize the option of hodling.
Cashing Out on Your Crypto Assets
To cash out on your cryptocurrencies, you have to sell them. However, for this option to be profitable, the price at which you sell them has to be significantly higher than the price at which you purchased them. In addition, cashing out is often risky because many investors rush to sell their coins during large price drops (dips).
Also read : 3 Best Crypto Trading Tools in 2024
Should you Hoard Your Crypto or Cash Out?
Over the past few months, the value of most cryptocurrencies has been maintained at a low level compared to the crypto rave last year. While there have been exceptions with some coins, this has been the general outlook of the crypto market. For example, last year, Bitcoin hit an all-time high of $60,000 and even towered at $67,000 in October 2022. However, by the 13th of March 2021, the price of Bitcoin had dipped to $38,959.
The decision on whether to hoard or sell your crypto is dependent on some factors. The first is the type of cryptocurrency in question. When you are convinced that there are significant potentials for the cryptocurrency that you have invested in, you may decide to hoard in expectation of a future price increase. For example, many speculators have put their faith in XRP (Ripple) due to the strong technology that backs the project.
On the flip side, you can decide to sell your crypto assets at this time if you believe that you have made significant profits. However, it is important to ensure that you are not rushing to sell your assets due to fear or anxiety about the current price drops. Cryptocurrencies are, by their nature, highly volatile, and there are many prospects that crypto values will increase yet again.
Conclusion
Whichever of the positions you decide to opt for concerning your crypto investments, ensure that you conduct enough research about your cryptocurrencies. This will guarantee that you make decisions that are in your best interest.
