Reasons for Restarting in Cryptocurrency Investment

Those who have invested in the cryptocurrency market have undoubtedly experienced some loss. High volatility can wipe out a significant portion of your portfolio within a few days. However, completely withdrawing is not the right solution for many investors.

Ankush Chowdhury, founder of Humanizer AI, experienced nearly a 40% loss during the market crash in 2022. Despite this recent history, Chowdhury lists six reasons to believe in the potential of cryptocurrencies.

In their early days, cryptocurrencies were poorly regulated and used in limited areas. Today, regulations are clearer, exchange platforms are more secure, and technology continues to evolve. Chowdhury states, "Today, the cryptocurrency market is very different from the past. Regulations are clearer, infrastructure is better, and applications have become practical." For example, firms like Tesla and Microsoft now accept cryptocurrency payments. However, this was not the case just five years ago.

One of the biggest traps for new investors is viewing cryptocurrencies as a quick way to get rich. Chasing quick profits often leads to significant losses.

Chowdhury says, "I used to make quick, thoughtless decisions, and because of that mindset, I was investing money I could afford to lose." However, now his strategy is to invest regularly in well-known cryptocurrencies like Ethereum and Bitcoin. "I’m investing in things that I could have overlooked over the years," he adds.

Such a shift in mindset can help prevent the repetition of mistakes you might encounter along the way.

It can be easily said that cryptocurrencies are risky, but history shows that no market is immune to downturns. The stock market fell in 2022, and the housing market collapsed in 2008.

Chowdhury notes, "My stock portfolio suffered in 2022. The real estate market collapsed in 2008. Every investment carries risks. At least with cryptocurrencies, they are not affected by trading decisions and operate 24 hours a day," he says.

The adoption of cryptocurrencies is rapidly increasing. Chowdhury explains, "Every year, more people are using cryptocurrencies. Bitcoin has become a legal tender in El Salvador. Major banks now offer cryptocurrency services. This trend is not going away." This increasing acceptance is too evident to be overlooked.

Expecting instant wealth from cryptocurrency is one of the biggest mistakes. The reality is that cryptocurrencies are more suited for long-term investment, just like stocks.

Chowdhury shares, "I no longer aim to get rich within six months. In my view, cryptocurrency is a 10-20 year investment." He adds, "Initially, there was skepticism about every major technology. Those who held Google and Amazon fared well when the internet bubble burst in 2000."

Cryptocurrency is an all-or-nothing bet. Many experts recommend limiting the amount of cryptocurrency to 5-10% of the total portfolio. This way, you can benefit from the cryptocurrency market without taking on all the risks.

Chowdhury says, "10% of my total investments are allocated to cryptocurrency. If it goes to zero, it's no problem. But if it becomes part of the financial future, I want to reap the potential benefits," he concludes.