Should You Use DCA Strategy? š¤
DCA stands for dollar-cost averaging ā a strategy where you invest a fixed amount into an asset at regular intervals, regardless of price. Itās simple, consistent, and designed to smooth out volatility over time āļø
The benefit of DCA is that it removes emotion from the process. You donāt have to guess tops or bottoms. You donāt need to watch charts all day. Itās useful for people who want exposure to crypto but donāt want to trade actively.
šØ But be careful. In crypto, most assets don't survive long. DCA works best with assets that have long-term strength like Bitcoin. Applying it to low-quality tokens can lead to long-term losses. DCA only works if what you're buying survives.
If you're curious how DCA wouldāve worked on different assets, thereās a tool for that. You can plug use it to track how theoretical DCA strats would've performed over time. It helps you backtest ideas instead of relying on guesswork.
š§® For example, investing just $100 monthly into Bitcoin starting 8 years ago wouldāve turned into $67,086 today, with $57,486 in pure profit.
In my opinion, if you believe crypto will succeed long-term, you must DCA into BTC with at least some amount of your income, otherwise, why are you here? š
