A large majority of crypto investors opt for the DCA strategy

Crypto investors prefer the so-called dollar-cost averaging (DCA) strategy when it comes to buying Bitcoin and other cryptocurrencies, according to a new study from Kraken. About 83.5% of investors used a DCA strategy, while for 59% it is still the primary way to buy crypto.

Wat is Dollar Cost Averaging?

Dollar Cost Averaging is the purchasing of financial assets at regular intervals. For example, by pressing the buy button once a day, week or month. Many platforms also offer this automatically.

Researchers at Kraken claim that this strategy can “reduce the impact of short-term price volatility and remove emotions from investment decisions.”

More than 46% of respondents see volatility protection as the biggest benefit of DCA. While 33% believe it helps build consistent investing habits. About 12% indicate that DCA takes emotion out of the game.

It’s funny that the reasons for DCA also change based on income. People who make less than $50,000 say the biggest benefit is that it makes them invest more consistently.

People who earn more than $50,000 mainly point to reducing the impact of market volatility as a benefit. This is especially the case for respondents who earn between $175,000 and $199,000.

In that group, seven in ten people believe that limiting volatility is the biggest benefit of the strategy.

But are these statements correct?

Funny thing is that Kraken has also found that many people no longer stick to their strategy once the losses start to mount.

Just over 8% stick to their strategy when losses come into play. While people who use other strategies are better able to stick to their plan in a turbulent market.

“Our research shows that the more an investor earns, the more confident they are in sticking to their investment strategy,” the researchers said. Cracking.

Nearly 63% of people with incomes above $100,000 say they have a “very strong” ability to stick to a trading plan. Even if the market becomes a lot more volatile.