Interesting facts
31. March 2022  • clock 3 min •  Boris Hasko

You Are Not Losing When Cryptocurrency Drops Unless You Withdraw

The cryptocurrency market has excellent growth potential but is also considerably volatile. Therefore, it can be subject to frequent fluctuations. Even though it occasionally quickly drops, many experts agree that it should grow substantially in the future. If you are new to investing in cryptocurrencies, it may seem like an investment loss whenever the market is down. In reality, you’ll decide whether you’ll be actually losing by how you’ll react to the market drop.

Better Invest Than Speculate

Investments in cryptocurrencies behave the same as anything else. Every market has its ups and downs, and cryptocurrencies are no exemption.
However, they differ from other assets in the extent, timing and speed of these fluctuations. The cryptocurrency market is volatile, and it can easily frighten new investors. But it’s precisely the price corrections that present an opportunity to increase your investment portfolio.

Focus on the long-term investment and not on speculations where people aim for a quick profit. Speculations go hand in hand with great risk because nobody can exactly predict the short term market development. Long-term market growth is much easier to anticipate. Investors often find that the longer they keep their finances invested, the higher the chances of profit. This is precisely what Fumbi products are built on, the long-term cryptocurrency market growth.

A Loss Is Not Really a Loss

When you have your resources invested in cryptocurrencies while the cryptocurrency market is down, it’s easy to feel like you are losing your money. However, that doesn’t become a reality unless you sell your cryptocurrencies at the wrong moment. While the corrections at the cryptocurrency market are not the most pleasant thing, seasoned investors know that the market naturally experiences positive and negative growth. This is especially true for the cryptocurrency market. Holding on to your cryptocurrency investment while the market is going down is the only way that your portfolio might later profit from the revitalisation of the market.

A market reversal can easily lead to a return on your investment, often with additional profit. However, if you sell all of your cryptocurrencies while the market is down, there is no hope for a recovery. Even if it might feel like it, you are not losing during drops unless you sell your cryptocurrencies.

If you buy bitcoin, it doesn’t automatically mean that you will be profiting next month. After a month, maybe even after half a year, you can easily find yourself at a loss without affecting the expectation of long-term growth. It’s good to realise that a possible hundredfold value growth within the next few years won’t happen without sizable turbulences.

What to Do When the Market Is in Red Numbers?

A much better strategy than selling out is rebalancing the portfolio to mirror market conditions and prospects. Thus, maintaining the desired combination of cryptoassets.

For example, if you have spent €1000 and the value of your investment drops by 50% to €500, you are at an unrealised loss. What to do now?

  • If you are not selling your cryptocurrencies and the value of the investment increases by 100%, you have your initial deposit of €1,000 back.
  • In case you have deposited another €1,000 during this drop to €500, your current investment would be €1,500. After 100% market growth, it would become €3,000. After subtracting your deposits of €2,000, you would be left with €1,000 of pure profit.
  • However, if you had withdrawn the rest of your investment when it dropped by 50%, you wouldn’t be able to profit from the market growth.

That’s why it’s profitable to invest while the market is down.

Invest Into Cryptocurrencies Effortlessly With Fumbi

If you are considering investing in cryptocurrencies, Fumbi is here for you. Thanks to us, your investment is effortless, easy to comprehend and safe.

Our Fumbi Index Portfolio follows the market capitalisation of cryptocurrencies, while our very own smart Fumbi Algorithm performs daily rebalancing. The algorithm mirrors the market growth as a whole and doesn’t rely on specific cryptocurrencies.

Last year, investing in the Fumbi Index Portfolio brought our users twice the profit of investing in bitcoin alone. While bitcoin brought investors a yield of 62.34%, the Fumbi Index Portfolio achieved 146.23%.

For a long-term investment towards your future, you can also use our newest product, Fumbi Bitcoin and Gold. It connects the unique benefits of two worlds: the potential of the fast-growing Bitcoin and the stability of real gold. Besides Bitcoin, you also invest in cryptocurrency PAX Gold, which is covered by real gold deposited by the Paxos company. The gold stabilises possible fluctuations.

Join over 100,000 of our users and capitalise on the potential of cryptocurrencies easily, safely and efficiently.

Start investing

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Boris Hasko


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