Due to its decentralized nature, accessibility, and potentially high returns as well as a growing mainstream recognition, crypto has become highly attractive in terms of innovation and legitimacy. As more major companies turn to cryptocurrencies, they become an even more enticing opportunity that doesn’t appear likely to slow down anytime soon.
Crypto platforms offer several tools for buying crypto, and one of the most used is a cryptocurrency price calculator. Using this instrument allows you to start your short- and long-term crypto investing.
Which Crypto to Buy Today for Short-Term?
If you are looking to make a short-term investment, it is beneficial to equip yourself with the fundamental principles of technical analysis so that you can secure advantageous entry points.
If you’re looking for a cryptocurrency to invest in, the clear choice is Bitcoin. This market may be young, but it’s already led by this digital currency. In terms of crypto assets, Bitcoin can easily be considered a “large-cap investment,” and should not be overlooked. Apart from Bitcoin, there are a variety of other altcoins that have immense growth potential like ETH, MATIC, MANA, SOL, and ADA. However, when investing in such altcoins safeguarding your assets should not be overlooked. To address this concern, consider exploring sites like monix.store that offer a wide selection of the best crypto wallets. Such wallets ensure the security and protection of your investments, providing a safe space to store your altcoins.
Long-Term Crypto Investment vs. Short-Term
Here are a few key comparisons of these two methods:
- Timeframe. Long-term trading involves maintaining one’s crypto positions over a course of months or years, while short-term traders stick to investments that span days or weeks. This is the fundamental contrast between long and short-term investments in cryptocurrency.
- Trading strategy. Those that favor long-term crypto investing, generally opt for the buy-and-hold strategy and emphasize on underlying fundamentals of their crypto. On the other side of the spectrum are short-term traders who prefer to be more active in trading markets by monitoring price movements with tech analysis and other tools to capitalize on fleeting opportunities.
- Risk tolerance. Compared to long-term trading, short-term traders are subjected to higher degrees of volatility and risk. This is due in part because these investors tend to use leverage when making trades, which can enhance benefits but also increase potential losses. On the contrary, those engaging in long-term crypto investing focus more on maximizing their returns by slowly building up positions over time despite any current market trends or fluctuations.
- Tax implications. Unlike long-term trading, short-term trades are subject to higher taxes since they are considered individual taxable events. On the other hand, capital gains tax significantly decreases for assets held longer than a year when it comes to long-term trading, making them more advantageous in terms of taxation.
So the distinctions between short-term and long-term crypto investment revolve around the timeframe of investment, approach to trading, associated risks, tax consequences as well as your own goals. To decide which strategy works for you best it is essential to think through your tolerance for risk and objectives before making any decisions.