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What kind of mentality should we have before making a fixed investment?
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2 hours ago 6,107

What kind of mentality should we have before making a fixed investment?

In the investment field, fixed investment is often regarded as a simple and easy-to-use strategy. However, the reality has poured cold water on many investors-many people not only failed In order to achieve wealth appreciation, he repeatedly suffered losses and his money bag continued to shrink.

"I made a fixed investment, but I lost a lot of money"

"I have no money to make a fixed investment." ”

CryptoDCA has received a lot of similar feedback as early as the user research stage. They either lose money or are strapped for funds. They don't even know the true value of fixed investments, so they cannot feel the steady growth of wealth.

What is the reason for this? In fact, although fixed investment seems simple, it contains many mysteries. Before embarking on the road of fixed investment, we must be fully prepared in multiple key aspects, so that we can effectively increase fixed investment returns, reduce risks, and truly realize the accumulation of wealth.

But first, let’s take a look at what kind of mentality we should have.

01 Don’t predict the short-term market

First of all, if we choose fixed investment, we must uphold the The most basic principle - don't predict the short-term market.

The cruel reality is that subjective judgment cannot accurately predict the short-term rise and fall of the market.

Few people can accurately predict the short-term rise and fall of the market over the long term. This is a common problem among most people. What we should pay attention to here is the short-term rise and fall of the market. Because to predict the long-term rise and fall of the market, you can actually refer to off-market factors such as macroeconomics, external markets, microscopic technology, and changes in segmented news. These factors usually have a certain degree of predictability.

02 Look more at factors

The financial market, including the cryptocurrency market, is large and complex The ecosystem brings together participants from all over the world and from all walks of life, including individual investors, institutional investors, enterprises, etc. The investment decisions of these participants are affected by countless factors, such as macroeconomic data, situation, industry trends, corporate financial reports, sudden natural disasters, and investors' own emotions and expectations.

In this extremely complex short-term situation, the direction of development of things can easily become confusing. Many factors work together, and it is difficult for people to take all factors into consideration, so misjudgments may occur.

These many complex factors often do not last for a particularly long time and do not have strong cyclicality.

However, macro-influencing factors are often sustainable and last a long time. For example, a country's industrial development often takes decades to truly see results, and influencing factors of this level are easily known to the public, and their future trends can be predicted. Therefore, it can become a factor for people to consider market trends, especially long-term trends.

For example, the current cryptocurrency market is generally bullish in the long term, and mainstream currencies such as Bitcoin (BTC) and Ethereum (ETH) are more is bullish in the long term.

Why?

Because with the rapid development of the digital economy, more and more people are beginning to face the value of cryptocurrency. For example, Japan and Singapore have incorporated cryptocurrencies into payment methods and supported their development through sound regulatory frameworks. Although the United States does not have uniform regulations at the federal level, it is generally open to cryptocurrencies. It has adopted strict supervision, completely banned cryptocurrency trading and mining activities, and at the same time actively promoted the research and development and pilot testing of central bank digital currency.

Once the level changes are released, they are usually sustainable and predictable.

Trump and cryptocurrency

Trump, before 2024, especially Trump is skeptical of cryptocurrencies. He once said on Twitter: "We have only one real currency in the United States - and that is the U.S. dollar." He believes that cryptocurrencies have no real value and may be used for various criminal activities. Provide a breeding ground.

But after he was officially nominated by the Republican Party to run for the U.S. President in 2024, his attitude towards cryptocurrency took a 180-degree turn and he began to strongly support it. Cryptocurrency. Trump plans to make the United States the global cryptocurrency capital and promises to relax cryptocurrency regulations and create a cryptocurrency-friendly environment if elected. He also expressed the idea of ​​listing Bitcoin as a U.S. strategic reserve asset, and proposedThe vision of establishing a Bitcoin reserve. He said that cryptocurrency is a very interesting thing, and perhaps using cryptocurrency can resolve the US debt crisis.

BTC price trend after Trump was elected on November 5, 2024

On December 4, 2024, Trump nominated Paul S. Atkins to serve as the head of the U.S. Securities and Exchange Commission ( SEC) Chairman. Atkins was the former CEO of Patomak Global Partners, a firm that advises financial firms and cryptocurrency companies, and was co-chairman of the Token Alliance, a cryptocurrency industry lobbying group. Choosing a person like Atkins who is closely related to the encryption industry as the next chairman of the SEC, even if there is a possibility that Trump has a good personal relationship with him, his background in the encryption industry must have been the reason why Trump chose him. Important reasons.

Such personnel appointments will undoubtedly have positive significance for the development of the entire encryption industry in the United States.

The price of BTC rose slightly after the announcement of personnel appointments< /p>

At the same time, the Trump team is planning to add a new office in the White House focused on cryptocurrency. A new position. The person in charge of this position will lead a team to build a communication bridge between Trump, Congress and various federal agencies. Cryptocurrency practitioners have high hopes for this and look forward to giving direct feedback to Trump through this position. Opinion.

As the most developed country in the world, the United States can be viewed as a weather vane for cryptocurrency. And as it expands and deepens, other countries will also join in. A certain big country in the East on the other side of the ocean will not allow itself to fall behind in this technological and financial transformation. Its preliminary exploration and relaxation measures have been quietly rolled out on some platforms and media.

Others

Switzerland has gathered many well-known cryptos in its “Crypto Valley” Currency companies, such as the Ethereum Foundation, etc., are also cryptocurrency-relatedClear and supportive guidelines are in place for ICOs and token classifications.

Germany is the first to officially recognize the legal trading of cryptocurrencies such as Bitcoin, and treats major cryptocurrencies as legal private currencies. The number of its Bitcoin and Ethereum nodes Second only to the United States. In terms of taxation, residents who hold cryptocurrencies for more than 18 months are not required to pay taxes, while capital gains tax is only levied on investors who hold cryptocurrencies for less than a year and whose gains exceed 600 euros.

These are all macro-level influences. We can assist our judgment based on historical trends, social development, various countries and other factors. Trump has frequently courted cryptocurrency enthusiasts, mainly to build momentum for his campaign; similarly, the Democratic Party will also woo this group in order to gain their votes. With this factor, we can say with certainty that cryptocurrencies, especially mainstream cryptocurrencies, are bullish on the long-term time frame.

03 Be patient, my friend

Fixed investment is the abbreviation of regular fixed amount investment. The basic principle is to continue buying regardless of market price fluctuations by investing a fixed amount of money at fixed intervals. When the market falls, the same amount can purchase more shares. When the market rises, although the number of shares purchased decreases, the overall investment cost can be smoothed.

However, this effect of smoothing costs is not achieved overnight. It requires multiple fixed investment operations, spanning different market cycles, ranging from a few months to a few years. , can it be fully reflected. Adhering to a fixed investment strategy for a long time can effectively cope with market fluctuations. By deploying in batches at different points in time, investors can buy more shares at a lower price when the market falls, thereby gaining greater upward flexibility after the market picks up.

The cryptocurrency market is highly uncertain and volatile. During the fixed investment process, short-term market fluctuations are normal. If there is a lack of patience, investors may panic due to the short-term market decline and may choose to stop fixed investment or even cash out due to fear of further losses, missing the opportunity for subsequent market rebound to make profits; or due to the short-term market rise, investors may be eager to make profits and terminate fixed investment early, unable to achieve the goal of fixed investment. The goal of accumulating gains during long-term market fluctuations.

The charm of fixed investment lies in the compound interest effect, that is, the investment income in the early stage can be used as the principal of later investment to continue to generate income.

Suppose we invest in Bitcoin (BTC) for a period and achieve overall returns.At this time we chose to sell. Then we will receive the original investment principal plus income after deducting handling fees. Then when the price of Bitcoin is relatively low, start another round of fixed investment and continue to be patient.

BTC two-year price chart

We can see that in the two-year period, the price of Bitcoin is generally bullish, but there is still a decline. This is often the moment when we can choose to start a new round of fixed investment. Of course, the main premise is to choose a long-term bullish investment target such as Bitcoin.

ETH two-year price chart

ETH can also be our fixed investment target. Although we can see that there was a drop of more than 10% in September, it quickly recovered to its previous peak afterwards. .

However, it takes a long time for compound interest to work. Patience allows investors to stick to long-term fixed investments, allowing funds to continue to increase in value over multiple cycles. By insisting on fixed investment for a long time, the principal and income will grow on a rolling basis, and ultimately realize significant appreciation of assets.

Investment market information is complex, and various short-term news and market forecasts can easily interfere with investor decision-making. Patient investors can focus on long-term investment goals, not be moved by short-term information, stick to fixed investment plans, and avoid being misled by market noise and making wrong decisions.

In the early days of fixed investment, investors often had doubts about the effect, but after being patient and persevering, they witnessed fixed investment smoothing costs amidst market fluctuations and increasing profits, which gave them confidence in the fixed investment strategy. As it strengthened, the determination to make a fixed investment also became firmer.

On the road of fixed investment, obtaining ideal returns every time you cross a market cycle is the best affirmation of investors' patience. This successful experience encourages investors to be more patient in subsequent investments. Patience and fixed investment help each other to form a virtuous circle, helping investors achieve good results in long-term investments.

04CryptoDCA is your best choice for fixed investment

The goal of fixed investment is the best is bullish in the long termInvestment target.

The current investment options for CryptoDCA are Bitcoin (BTC) and Ethereum (ETH). The two major cryptocurrencies are undoubtedly bullish in the long term. Bitcoin has proven its value over the past 16 years and is now known as “digital gold.” ETH is the native cryptocurrency of the Ethereum network, and it plays an important role in the Ethereum ecosystem, just like real-world currency, used to pay various fees and incentivize network participants. Therefore, it is very correct to choose these two cryptocurrencies as fixed investment choices.

At the same time, CryptoDCA is an on-chain decentralized fixed investment agreement deployed on Optimism, which avoids Centralization may present the risk of misappropriation of funds. The user directly links the wallet, and the cryptocurrency purchased in each period after the fixed investment starts will be directly entered into the user's wallet. As long as users do not lose their wallets and mnemonic phrases, this asset will be guaranteed to be in the hands of users, truly achieving decentralization and security.

05 Summary

Fixed investment seems simple. You only need to invest a fixed amount on a regular basis in a set goal; The real challenge with fixed investing, however, is adjusting our mindset.

Avoid trying to predict short-term market fluctuations, and instead evaluate the overall market trend from a macro perspective.

Remain patient and let time be our partner on the investment journey.

I firmly believe that as long as we adhere to these two mental principles, we will eventually achieve an increase in the value of wealth and an improvement in the value of life. At the same time, choosing CryptoDCA, a centralized fixed investment agreement on the chain, for fixed investment will not only help users maintain and increase the value of their assets, but also ensure security, allowing users to gain more security and gain a stable future.

Keywords: Bitcoin
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