How to Do Long Term Investments with Cryptocurrencies?11 min read

How to Do Long Term Investments with Cryptocurrencies?11 min read

Now that the crypto market has matured, most investors consider digital assets such as Bitcoin or Ethereum as long-term investments, rather than short-term speculative trading. But what exactly does it take to build a long term investment approach with crypto? 

Here, we’ll learn what long-term crypto investing is all about, which coins are best, whether there are any advantages, risk mitigation, and why The Kingdom Bank is a perfect fit for long-term crypto investors. 

What is Long-Term Cryptocurrency Investing?

Long-term crypto investing involves purchasing and holding selected digital assets for years rather than days, weeks or months. 

The aim is to profit from a potential rise in price over the long term, rather than short-term market trends. This approach requires a long-term bullish perspective about the crypto sector and projects in the long run. 

Rather than obsessively monitoring short-term prices, long-term crypto investors pay attention to fundamentals and try to spot coins with strong real-world applications, active development, and large communities that could really rise in value as the blockchain tech and network matures. 

They want multiple-fold returns decades down the road instead of overnight gains. 

Which Cryptocurrencies are Best for Long-Term Investment?

For choosing which cryptocurrencies to own as part of a long-term investment strategy, experts generally recommend the following: 

Bitcoin -The largest and most well-known cryptocurrency, Bitcoin is a long-term favorite due to the first-mover advantage, brand name, and store-of-value story. The firm has a fixed supply limit, which makes it a good inflation hedge for the long run. 

Ethereum – Because it is the smart contract platform and development platform, Ethereum has immense potential as DeFi, NFTs, and Layer 2 scaling technologies evolve. Its upcoming switch to proof-of-stake should enhance its sustainability, too. 

Best Altcoins – Apart from the above two, altcoins such as Solana, XRP, Dogecoin and Avalanche can expose you to novel new blockchain networks that try to capture market share by providing unique features or scaling solutions. 

Large-Cap Altcoins – Well-established altcoins such as Shiba Inu, Toncoin, Sui, and Chainlink offer alternatives to Bitcoin, with robust communities and use cases behind the long-term vision. 

The trick is to choose coins that have not just long term speculative hype but actual long-term value propositions and development cycles that span years. 

What are the Benefits of Long-Term Crypto Investments?

Unlike crypto trading in the short-term, long-term crypto investing has certain advantages: 

• Low risk – By investing in the long term, rather than on market timing, you are not “snapping at falling knives” and hedging against losses from short term turbulence.
• Chance for better return – Cryptocurrencies historically earn their best returns if you buy and hold for several years rather than days/weeks/months. In the long run, the trajectory has been massively upwards.
• Tax benefits – In most countries, crypto holdings for longer than a year enjoy lower long-term capital gains taxes of as little as 0% compared to short-term trade income taxes. 
• Less anxiety– There’s less anxiety when you’re not thinking about the daily, weekly, or monthly prices like there’s with short-term trading. Investors can take their eyes off the chart and look to work and life.
• Making money – Simple regular investments in the best cryptos will make a difference in your life over the course of 5-10 years as the industry matures. 

A long-term buy-and-hold strategy is an appealing combination of risk and reward for investors with a strong belief in the cryptocurrency’s long-term viability. 

How Can I Minimize Risks in Long-Term Crypto Investments?

Long-term crypto investments carry less risk than short-term speculative investing, but there are still best practices to limit the potential risk: 

• Mix and match your best assets – Don’t run everything. Invest in tiny stakes in a few of the top cryptocurrencies instead of buying every coin in the house. 
• Dollar cost average – Invest weekly or monthly, if possible, so that you average out your buy-in price instead of flooding in once the price is high. This displaces emotion from market timing. 
• Don’t spend more than you can afford – Don’t take any chances with money you might need soon to cover bills or emergencies. Invest only in funds with long-term investment returns. 
• Safeguard your investments – Put your cryptos in the hands of a password, 2FA, hardware wallet, or ” crypto-friendly” bank rather than being robbed or taken away by fraudulent exchanges or personal security flaws. 
• Stay diversified – Maintain a well-balanced, diversified portfolio that is not 100 % exposed to cryptocurrency price fluctuations. Normal stocks, bonds, real estate, commodities and commodity insurance can absorb downside crypto risk. 

Implementing best practices such as these gives a sound risk management structure to crypto investment over the long term. 

Which Bank is the Best for Long-Term Crypto Investing?

If you are considering a long-term buy-and-hold crypto portfolio, then the best bet is to maintain your holdings in a regulated crypto-friendly financial institution such as The Kingdom Bank, which provides safe crypto banking services. 

The Kingdom Bank is one of the only licensed banks in the world that allows customers to deposit, trade and store cryptocurrencies from their accounts. 

The Kingdom Bank, as a regulated bank, gives you the security, supervision and insurance protections that individuals and institutions need to store crypto for the long-term.

The following are some of the main advantages of using The Kingdom Bank for long-term crypto trading:

• Secure online and mobile banking with bank-grade security. 
• Insurance on deposit funds of up to USD 100,000.
• Accepts deposits and withdrawals from 60+ fiat and large cryptos. 
• Interest-earning crypto accounts available  
• Advanced trading capabilities and portfolio management modules. 
• Comprehensive KYC/AML controls to ensure compliance and security. 

If you’re looking for the best long-term investment platform to purchase, store and expand your crypto assets, The Kingdom Bank offers a controlled banking alternative to dangerous exchanges or self-custody. 

It gives investors the flexibility to “set and forget” without having to worry about security for 5-10+ years. 

Long-term crypto investments are an ideal investment option for those looking to build wealth using digital assets but don’t want the high risk of short-term speculative investing. 

Using coin selection, dollar cost averaging, and private, regulated wallets such as The Kingdom Bank for long-term storage, most mainstream investors can turn their investments around by simply purchasing and holding on to the best crypto coins for 5-10 years or longer. 

If you are eager to embark on your long-term crypto investing journey, apply for an account at The Kingdom Bank today and get started with approved banking platforms specifically suited for long-term crypto investors. Please check out the service and account features of The Kingdom Bank below.