Initial capital in Bitcoin trading: experts have named the minimum amount

To begin with, one dollar may be enough on the cryptocurrency market, but in the future, experts recommend investing in digital money at least a thousand, and even tens of thousands of dollars.

The popularity of digital money is growing in 2020. More and more people are seeking to enter the blockchain industry through investing, mining or trading. However, first you need to decide how much money can be allocated for a risky attempt to make money on cryptocurrency. Experts told why $1 sometimes may be enough, and in which case it is not worth coming to the market without $50,000 in stock.

$ 1 trading


Vladislav Antonov, analyst at IAC "Alpari"

If a person comes to the market to trade, then he must first learn this craft and only then decide with what amount to start. You can buy a Porsche and tie it in a knot in a few minutes. To get behind the wheel of a car, you need to learn the rules of the road and learn how to manage them, avoiding accidents. After training, pass the exam and get a license. Here the market takes the exam. If you break the rules, he takes money from the deposit through traders who are on the other side of you.

On the Binance market, you can start trading with as little as $1. There is such a cryptocurrency - Stellar (XLM). 10 tokens cost 0.03 USDT, 100 tokens - 0.39 USDT, 1000 - 3.91 USDT. You can make 100 trades at 1 XLM, and you won't even get losses by $1. Perfect conditions to hone your skills. The market can also be compared to ultimate fighting. Here it is important not to start with what amount, but to learn how to correctly calculate the trading volume from the protective stop. That is, a trader must first determine how much he is risking in one deal and calculate the risk. It is believed that the risk in one transaction should not exceed 5% of the deposit, and better not more than 2%. First you train, then you enter the ring.

If you take, for example, a $100 deposit, then 5% will be $5. You clearly know that if the market goes against you, you will lose $5. 90% do not do this and, using large shoulders, lose everything. Then, after analyzing the market, you find the entry point and the level where the protective stop will be placed (the level at which the loss will be closed). This is where the main problem of traders' failures lies. Everyone wants to make a million from $100, only they take big risks.

The trader must find a comfortable amount of losses. Loss is the right to earn like a business expense. When a trader gives up driving on the market with a small amount of the deposit, then he can increase it. It doesn't matter from what amount you count 2%. If the deposit is $1000, then this is a risk of $20, if the deposit is $10,000 - $200, etc. It is necessary to answer the question: at what amount of loss is it comfortable for me to trade? And if it is possible to reduce the risk per trade by less than 2%, then it is worth doing.

$1000 and diversification


Andrey Podolyan, CEO Cryptorg.Exchange

The average static deposit on crypto exchanges can be considered a deposit of about $1000. In general, for many traders this is already the amount that it is a pity to lose and with which it is interesting to work.

However, it is worth focusing on the income that OTC activities bring to the trader / investor. If a person earns $10,000 and more monthly, then, naturally, he will not be interested in a $1,000 deposit. And if a person earns $500-1000, then a $1000 deposit for him will be even too large an amount.

In my opinion, a trader is successful if he earns a little higher than the average national salary. Example: Average salary is $1000. On average, a trader earns 10% per month on his deposit. Therefore, the working deposit must be at least $10,000.

Valery Petrov, RACIB Vice President for Market Development and Regulation

When determining investments in cryptocurrency, first of all, you need to understand that cryptocurrency cannot be the only asset in an investment portfolio.

It must be diversified according to the risk-return criterion. The point of this approach is as follows: the entire portfolio is structured according to the level of risk that you are willing to take on.

Since cryptocurrency belongs to high-risk assets and, in fact, is a speculative asset, the risks of losses for which are very high, it makes no sense to allocate more than 25-30% of the portfolio to such an asset class. Especially in today's market, when the classical theory of portfolio investment does not work very well. “Black swans” and other market fluctuations are constantly encountered, which do not fit into the classical theory of investor behavior in the market.

For a person whose main income is wages, the formation of such an investment volume should occur gradually. My recommendation is to transfer to such an investment portfolio about 10% of monthly income, despite the fact that it is at least $1500-2000. Then any loss will not greatly affect the lifestyle.

It makes no sense to start investing in cryptocurrencies from the very first deduction. A third of the conditional $200 is an insignificant amount to go to the digital money market with it. On the crypto market, it is advisable to start operations from an amount of approximately $1000.  Then the commissions and market fluctuations that exist there will not lead to quick and negative changes in the portfolio.

From this amount, you can increase investments in the crypto market. At the same time, it is necessary to observe the proportions according to which the volume of investments in cryptocurrencies should not exceed 25-30% of the portfolio, given that other assets are less risky, but they will be able to ensure stability.

Investments from $ 50,000


Victor Pershikov, Lead Analyst at 8848 Invest

When determining the minimum investment amount, you need to take into account the specifics of the cryptocurrency market, which distinguishes this site from classical financial markets. Firstly, the cryptocurrency market is incomparably more volatile than classic financial instruments, which is reflected in both higher incomes and higher risks of losing funds. In this regard, the initial capital must be sufficient in order to receive a decent return on investment, while remaining tolerant of risk. Secondly, price corrections in the cryptocurrency market are more significant than corrections in other markets, and can reach 70-90% of the developing trend movement. This also leaves an imprint on the initial capital requirements, because the investor must understand that he is just facing a deep correction and not sell his assets ahead of time, fearing a trend reversal.

The cryptocurrency market is still very young and there are high risks of various manipulations. In this regard, the investor should distribute his assets into the most diversified portfolio possible so that a collapse or bursting of a bubble in one sector does not lead to significant capital losses. Therefore, an investor must have a higher, by the standards of classical markets, initial capital in order to comfortably invest in digital assets.

I recommend starting investing in digital assets with an amount of at least $50,000, since this amount of funds, on the one hand, allows you to receive income that exceeds income from classical financial markets, and on the other hand, you can be calm and wait out the drawdown or decrease in the crypto market capitalization, which  happens quite regularly.

I would also advise focusing not on margin trading, but on investing in digital assets, since on the one hand, intraday trading is statistically successful with a fairly small number of participants, and on the other hand, the bullish nature of digital assets, coupled with a very real opportunity  selecting truly worthwhile assets into your portfolio allows even a not too experienced trader to succeed in the CFA market.

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