How to profit from Bitcoin crash?


There are many ways to profit from Bitcoin if crypto markets crash. What is the best way to make some gains? The answer depends on a trader. In this educational piece, we answer the following question: How to profit from Bitcoin crash? 

AtoZForex Despite some bumps in the road, Bitcoin is taking the main stage on the cryptocurrency market. Recently, analysts have weighed in on whether cryptocurrencies are in a bubble.

In fact, every time there is a crash in cryptocurrencies’ value, traders are in rush to profit from a potential bursting Bitcoin bubble. There are many ways to profit Bitcoin if crypto markets crash. We discuss some of the primary ways you can consider if things go south.

How to profit from Bitcoin crash?

Here are some specific methods that investors can apply.

Buy the dip

Buying the dip is one of the most basic and common strategies that can also bring significant gains. Yet, it is not as easy as it sounds, as it requires the proper timing of the market.

Moreover, during the dips, cryptocurrency exchanges often experienced connection issues due to high traffic. So, this might be quite challenging to be in time for the value dip.

Look into different prospective coins

Even though altcoins tend to follow the trend of Bitcoin, some of the alternative digital currencies do not largely depend on Bitcoin movements. For instance, when Bitcoin has dropped some 25% from its all-time high last week, Ripple prices surged past $1 or the first time ever. You can look into 11 Promising Coins to Invest in December 2017.

Do not let go

One of the hardest to keep up with, yet effective strategies is to hold on to your coins even during the dips. In case you do not sell your coins when they are below the value you bought them for, you lose nothing.

The strategy implies buying coins and not selling them during down times. Moreover, “do nothing” is one of the best strategies to deal with a crash. One of the best advice from the industry experts is to make sure you are holding the top five cryptocurrencies   they probably have the best chances to beat the crash.

Cashing out

This relatively controversial strategy and the one that is a complete opposite of our previous tip is exiting to fiat currencies.

Many investors rush to sell their cryptocoins when there is a crash. Yet, it is difficult to execute this strategy as it requires good timing of the market. Taking into consideration the high volatility of the digital currency market, this strategy can be implemented most successfully by pro traders.

Shorting Bitcoin

The short order is often used by traders, and this is one of the most profitable strategies if executed correctly. However, not many exchanges will offer this option, and it also requires a lot of trading skills to carry out such trade correctly.

Safe trading and Merry Christmas!

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