How much Crypto should you Invest

How Much to Invest in Bitcoin

The new year is here. A new dawn, a fresh start. Another chance to set new goals. So like everyone else, crypto enthusiasts, traders, and investors are plotting and scheming. Surveying the jungle, mapping out the land, laying their traps for 2023.

They are all looking for a way to make their 2023 crypto journey more profitable and less frosty and wintry than it was in 2022. And with crypto markets slowly picking up as evidenced by Bitcoin’s restoration to its pre-FTX levels, there’s renewed optimism in the industry.

So having understood what Bitcoin is, where you can buy it, and how you can store it, now you are probably wondering; how much should I invest in Bitcoin? What investment amount is too much and what amount is too small for me to get a decent return on my investment?

Well, that is exactly what today’s article is supposed to help you figure out. How much to invest in Bitcoin.

Crypto a Crucial Part of the Modern Investment Portfolio

At this point in time, it is unimaginable for any serious investor to lack crypto in their portfolio. After all, the total market cap of the industry has clocked $1 trillion dollars more than once! So despite any challenges involved, cryptocurrency as an asset class can simply not be ignored.

Granted, investors find it difficult to decide what portion of their portfolio to dedicate to crypto. That is because the truth is that there is no predetermined amount of the money one must use to buy Bitcoin that is set in stone.

Instead, the right amount to invest in Bitcoin varies according to:

I) The size of your investment portfolio
II) Your risk appetite and level of risk aversion
III) Your skills and understanding of crypto/Bitcoin investing

High Enough to Generate Returns, Low Enough to Minimize Risk

However, there is a general consensus your Bitcoin investment should constitute between 5% to 20% of your investment portfolio. For instance, the head of Hashdex’s global expansion division justifies allocating 5% of an investment portfolio to Bitcoin using the following explanation;

“This amount is small enough to keep an investor comfortable in periods of high volatility, but also large enough to have a truly positive impact on the portfolio if crypto prices rise.”

Therefore, for the sake of clarity, you can always use 5% to 10% of your investment portfolio as the benchmark of how much to invest in Bitcoin. Additionally, crypto platforms like Coinbase allow investors to invest in Bitcoin worth as low as $2.

Affordable Bitcoin Investment Minimums

Of course an amount as small as $2 is not practical because firstly, it cannot generate a worthwhile return. Secondly, there are fees to be paid for using the crypto platform. Considering that reality, the pragmatic minimum should be an amount starting from $50 going upwards.

By investing an amount upwards of $50 in Bitcoin, you can be sure you will earn a significant return on the principal if the price of Bitcoin goes up. That is while also covering the fees charged by the crypto exchange, crypto wallet, or stockbroker you are using.

So what’s next?

When all is said and done, the solution to the question of how much to invest in Bitcoin comes down to the delicate balancing of how much discretionary capital you have, your risk tolerance, and your level of skill and knowledge when it comes to Bitcoin investing.

Provided you assess the Bitcoin markets carefully, analyze forecasts, and continue sharpening your mastery of the crypto industry through a news platform like Crypto Apex, you are bound to achieve significant success as far as crypto investing goes.