Crypto INvestment Strategies 2021

Read our crypto blog to learn where and how to invest your cryptocurrencies to earn the best interest rates

Crypto Blog with Crypto Investment Strategies 2021

Here, we have collected all articles about the our crypto investment strategy for 2021. All articles are about how to get the best interest rate for each cryptocurrency. We have identified a strategy that suits our goals very well.

There are other strategies including HODL on a non-custody wallet, leverage trading and more. However, in the article below we present our crypto investment strategy for 2021

No Financial Advice, Information only. Do your own research

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Crypto Investment Strategies FAQ

No Financial Advice, Information only. Do your own research

What are crypto investment strategies?

As we see it, there are several different crypto investment strategies. We have chosen to go with the invest and HODL strategy to earn crypto passive income.

There are other investment strategies, some examples are

  • HODL
  • Leverage trading
  • Dollar average in, dollar average out
  • Swing trading
  • Bots trading
  • Arbitrage trading
  • Copy trading

How will the best interest rate impact my crypto investment strategy?

It´s important to look for the best interest rate if you apply a similar crypto investment strategy as us.

Why?

You might think that 4% or 6% interest rate doesn´t really matter. However, make a calculation over 10 years, 20 years and 30 years to understand and visualize how much this will impact your total crypto holdings over time. We have made a calculation and graph in our article about the best USDT interest rates.

At the same time, it´s important to not forget how important security is. You don´t want to get your cryptocurrencies lost due to a hack, bad business, scam or any other reason.

When we are talking about this, you must understand and manage a diversified crypto portfolio. Read more about crypto risk diversification VS over diversification.

How will crypto tax impact my crypto investment strategy?

It´s very important to weigh in how the crypto tax will impact your crypto investment strategy.

Pure technically, the tax can ruin your crypto portfolio if you don´t manage it appropriate.

For example, in Sweden you have to pay 30% tax on all gain but you can all deduct losses up to 70%.

Calculation

  1. You buy 1 Bitcoin for $30.000
  2. You sell 1 Bitcoin at $40.000
  3. Now, you have a net profit of $10.000 and a tax of $3000 to pay
  4. Now, you invest your $40.000 in ETH but ETH lose in value and you sell your ETH to get $30.000 back.
  5. Now, you have a net 0 profit. However, you can only deduct 70% of your $10.000 loss in your ETH trade. This will end up in a tax of $900.
Calculcations
1. Net win $10.000
2. Net loss $10.000, can only deduct 70% = $7000
3. Net win BTC+ETH trades are: $10000-$7000 = $3000
4. 30% tax on $3000 = $900

How will crypto risk impact my crypto investment strategy?

It´s very important to understand and manage the risks with crypto trading.

How can you manage your risks?

We have used a diversification strategy.

It means that we don’t invest everything in one cryptocurrency and we don´t hold all our cryptocurrencies in one wallet.

On top of this, you can dollar average out in an uptrend and average dollar in during a downtrend. Here, a lot of psychology and timing comes into play and this strategy can be hard to manage if you are a newbie.

The best tip you can get is to create a strategy and follow it, but market movements will probably affect you anyway.

How will crypto diversification impact my crypto investment strategy?

Diversification is important since it will reduce the risk that your crypto portfolio is completely lost due to a hack or business failure.