Although a bear market is a difficult time for many investors, it is a good time to invest. In the case of Bitcoin (BTC), the “Dollar-Cost Averaging” strategy has long since proven itself. Why is it ideal to launch your Bitcoin savings plan during a bear market?
The power of the DCA during a bear market
It’s a fact, we’ve been in a bear market for several months now and this trend could continue for quite some time.
Of course, no one can predict when the cryptocurrency market will go back up, but many investors see this period as an opportunity.
Indeed, there’s no denying that if you believe in the future of Bitcoin, it’s best to buy it during bearish phases like the one we’re currently experiencing. However, since it is never really possible to buy Bitcoin at the best price every time, you can turn to the Dollar-Cost Averaging (DCA) method.
This investment method, which has worked very well since the launch of Bitcoin, involves buying an asset with a certain amount at regular intervals, regardless of its price.
The effect of a bad entry into the market is largely limited with DCA, whereas an investment at the wrong time with a large capital sum could be catastrophic.
Investing in Bitcoin with DCA therefore smoothes the entry price and greatly limits losses in the event of a continuous price decline.
Since a bear market is good for investing, even though no one can predict when it will end, it is particularly advisable to build your portfolio while waiting for the trend to change.
To save Bitcoin in this way without getting into trouble, there is a solution: Bitstack. This French startup, which has obtained its PSAN registration with the French Financial Markets Authority (AMF), makes it easy to invest in Bitcoin thanks to several mechanisms that automate purchases.
3 ways to save Bitcoin with Bitstack
Recurring savings is the closest Bitstack comes to a traditional ACH. From an easy-to-use dashboard, you can set an investment frequency and an amount. For example, you can automatically invest €25 per week in Bitcoin.
It is also possible with Bitstack to buy Bitcoin on a one-off basis with a credit card, starting at just €1.
Finally, Bitstack’s flagship feature is the automatic rounding of bank transactions. For example, suppose you buy a coffee for €2.80. The amount is rounded up to €3 and the €0.20 difference is automatically converted into BTC.
All rounded amounts are accumulated in a kitty for 1 week and the saver’s bank account is debited with the corresponding amount at the beginning of the following week.
Automatic rounding is particularly easy to set up, and may be suitable for even the most inexperienced Bitcoin saver without any effort.
An internal survey conducted by Bitstack on 742 of its users gives a better understanding of why they chose DCA to invest in Bitcoin:
- 94% of savers will hold their bitcoins for more than 3 years (29% for more than 10 years);
64% have decided to invest in Bitcoin to diversify their investments; - 96% see it as a future savings solution.
The code is functional provided you have never saved in Bitcoin with Bitstack. The €5 in BTC will be credited to your wallet after you have activated a savings rule (rounding and/or recurring) and purchased at least €100 in BTC.
