‘Buy the dip’ or ‘Buying the dip’ for those that don’t know entirely what that means don’t panic, we are here to tell you exactly what you need to know. I’m guessing most by now have heard about cryptocurrencies being one of the most volatile markets in the world and getting placed well in the market can sometimes be very hard. ‘Buying the dip’ is a very simple way for long term investors to spread their buy-in value of an asset, after all, if your original buy was higher why not get some at a cheaper value. It can be beneficial for increasing your percentage gains. Sometimes when the price of a coin goes down it doesn’t always mean it loses value. After this guide, you will know exactly the top cryptocurrencies to buy during dips.
Top 4 Crypto Coins to Buy During the Dip
When dips come and the market turns red, many retail investors are left with the tails tucked between their legs. However, after reading this guide you’ll be ready to capitalise on the next big dip and get yourself well-positioned for the coming months. Below, you’ll find a few of our top picks for the best coins to buy during a dip.
BTC (Bitcoin)
Bitcoin is a decentralised digital asset created in January 2009 by the mysterious unknown face of Satoshi Nakamoto. It was the first cryptocurrency created and is also the biggest by market capitalization. Bitcoin is currently taking a breather after its last big rally up to an all-time high of $69,000. Bitcoin is now 28.4% below its all-time high as of 06/12/21 it is now trading at $49,150.
XRP (Ripple)
XRP was created in 2012 by the US-based technology company Ripple. It’s a digital asset built for payments, it can settle any size payment in 3-5 seconds and has some extremely low fees which make it so efficient. It is far more scalable than any other digital asset and many would say it’s incredibly undervalued. Seeing as though the all-time high was around $3.40 back in 2018, currently down 76% as of 06/12/21, it probably wouldn’t be a bad idea to grab yourself a piece of the cake.
One of the most popular exchanges to buy XRP is Kucoin, very user-friendly, easy to set up and they have great customer service.
Binance Coin (BNB)
BNB was launched in 2017 as a Utility token meaning users of Binance Coin receive a discount in transaction fees on the Binance Exchange as an incentive. Its uses have since expanded to numerous applications including, payments for transaction fees, travel bookings, entertainment, and financial services. Early on in May, the price of BNB shot up to a staggering $686 and at the time of writing this, we are currently seeing a 16% dip since then. Meaning it may not be a bad time to invest a little spare change, after seeing many altcoins blast their all-time high recently BNB is looking strong going into the new year.
LINK (Chainlink)
Chainlink was created in 2014 though it didn’t launch until 2017. It is a decentralised blockchain network that provides a link between real-world data and smart contracts that exist on the blockchain. It also offers a tradeable cryptocurrency token (LINK) which holds its own relevant value in comparison to fiat currencies.
When Chainlink’s token LINK first hit the market in 2017, they were being traded at just above a cent (USD). The cryptocurrency market capitalization was also understandably quite low back then. Prices stayed this way for a few years until the later part of 2020 when LINK saw a massive rise up to over $20 and then in May 2021 it hit an all-time high of over $50 per token.
LINK is still a risky investment but has a lot of upside potential
How to Buy the Dip – Step by Step Guide on Buying the Dip
Learning how to use a new exchange can be a difficult and time-consuming process, but it doesn’t have to be! To make things as easy as possible for you, we’ve broken down the entire process of buying the dip below.
Register for an Exchange
Before you can take advantage of the dip, you’ll need to register with a trusted exchange like FTX, Kucoin, or Crypto.com. Simply navigate to one of their websites, hit “Join Now”, and fill in the required details.
Verify Details
Most trusted brokers these days are regulated. While this offers several security advantages for customers, it also means that you’ll need to verify your identity before you can buy the dip. Typically, you’ll only need a photo ID (passport, driving licence) and proof of address (bank statement, utility bill).
Fund your Account
Once your account has been verified, you’ll need to fund it. Most exchanges make this an easy process. Just look for a button marked “Deposit” or “Deposit Funds”. Once you’ve found this button, just type in the amount you plan on investing and press “Deposit”.
Buy the Dip!
As soon as the funds land in your account, you’re ready to buy the dip! Just type the name of the asset you want to purchase into the exchange’s search bar, click on the relevant option, enter the number of coins you want to buy, & press “Open Trade”.
Conclusion
Buying the dip is an excellent way to get better positioned, priming yourself for large gains during the next runup. It’s a basic, yet effective strategy and can be used by anyone. The only risk comes with selecting a badly performing coin. However, as long as you stick to one we’ve recommended you should be in good hands! Overall, buying the dip is a wonderful opportunity for the savvy investor, but you should take care to DCA (dollar-cost average) into any positions to ensure you don’t miss out on a further drawdown.
FAQS
For the most part, cryptocurrency is perfectly safe. The danger comes from unregulated brokers or “scam coins”. To avoid these risks, we recommend always doing ample research before committing to a broker or asset.
An altcoin is any type of cryptocurrency other than Bitcoin. For example, ETH, XRP, and BNB are altcoins.
While you don’t have to buy the dip, doing so can be beneficial as it allows you to enter into a position at a far lower price than you would be able to