As the huge gains of bitcoin hits the media, I always get question amongst friends on how they can buy bitcoin. I know that they are definitely in for the gains. I think treating bitcoin or crypto currency investment should be treated as any other investments and one of the best way is if we do dollar cost averaging.

What is Dollar Cost Averaging

From Investopedia, Dollar-cost averaging is defined as an investment technique of buying a fixed dollar amount of a particular investment on a regular schedule, regardless of the share price. The investor purchases more shares when prices are low and fewer shares when prices are high. Given that no one knows where prices are in the near future, it is very prudent to not just invest a huge chunk of your money on a single buy. A good strategy is the spread the purchase across multiple purchases.

Mindset for the Long Term

Now Dollar Cost Averaging would be great only if you are confident enough with the prospect of bitcoin/crypto currencies in general. If you are in for get quick rich scheme then goodluck. Making money via in/out trading is possible but people are more likely to lose money and resort to gambling. Below are some of the reasons why we should be in for crypto currency for the long term

Distributed Systems

Distributed apps will help bring in a more inclusive society. Imagine no more Paypal/Visa/Mastercard who sucks in to much fees and currency spreads. No more Uber and giving drivers majority of their income. That is just the start. This is a win win for the economy as a whole.

Easier access to Capital

More and more people will be able to have access to capital especially people from the 3rd world. Ripple and Stellar are both active in this space. A lot of people in 3rd world countries are unbanked and usually huge corporations have no incentive to improve their services or innovate.

Cheaper Services

With no middle-men we should expect cheaper services available for us soon. Cheaper stock market trading, cheaper insurance, cheaper electricity cost and the list goes on.

Sit Back and Relax

The fundamentals of the blockchain and cryptocurrencies is bright. Just sit tight and relax and continue investing.

After spending many years in Wall Street and after making and losing millions of dollars I want to tell you this: It never was > my thinking that made the big money for me. It always was my sitting. Got that? My sitting tight!” - Jesse Livermore