- Crypto is a volatile place. Money can be as easily lost as made through the ups and downs of Bitcoin and the wider market.
- Should you hodl or actively trade the market?
- How many coins should your portfolio hold?
- Self-custody or keep your funds on an exchange with pre-determined stop losses?
Bitcoin OGs and experts in the space share their advice and opinions on how to protect your crypto.
Walk before you can run
Brock Pierce suggests that beginners should start with small investments and focus on understanding the basics of hodling and investing in crypto.
“It’s always better to walk before you can run…take your time and be informed.”
Self-custody for safety
Bitcoin OG, Brock Pierce, emphasizes the importance of self-custody. Holding your own crypto in a wallet provides better security than keeping it on an exchange that can be hacked.
Itai Avneri of INX Limited also supports self-custody, noting that it is the best way to protect yourself from events like hold on withdrawals.
Diversification: Don’t just buy eggs
Brock Pierce recommends diversification as a way to mitigate risks. It’s important not to have all your assets in one basket and to avoid putting too much money in volatile coins.
Andrew Latham, a certified financial planner, suggests spreading investments across various asset classes to cushion against volatility.
High-conviction bets
Lakov Levin, co-founder of Locus Finance, believes that Ethereum is the blockchain for the financial evolution of the 21st century and recommends holding Ethereum as a long-term investment.
A tool to stop losses
Brock Pierce advises using stop losses to limit losses during market dumps. However, caution should be exercised as stop losses can be a blunt tool in the crypto world where movements of 10% are common.
Options can protect against extreme volatility
Options trading can be used to protect against extreme volatility. The Black-Scholes model is commonly used to price options and estimate the theoretical value of assets based on implied volatility.
Jonathan DeCarteret, CEO of Bumper, claims that their protocol combines stop losses and options in a more efficient and cost-effective way.
Don’t fall foul of criminal scams
Roger Ying, CEO of Crytolock.ai, advises crypto users to focus on prevention, detection, and recovery to avoid falling victim to scams. It’s important to be educated on ways to prevent and secure transactions and to monitor crypto on the blockchain.
Hodling as a safe course
Hodling large-cap cryptocurrencies is considered a safe and easy way to maintain a position. It is recommended to use cold storage provided by hardware wallets for added security.
Overall, Bitcoin OGs and experts emphasize the importance of education, diversification, and caution when it comes to protecting your crypto investments.
