Last Updated: 28 July 2022
Some investors have been using this strategy for years: DCA. This is an abbreviation for Dollar Cost Average and is seen by many as the best way to save crypto. How does this work, and how can this new BTC Direct widget help?
What is DCA?
First of all, it is important to know what Dollar Cost Average is and what you can do with it. In short, DCA is a way of investing that allows you to buy as average as possible. As a result, you’ll be less worried about price fluctuations, while you’ll be able to benefit from the general rise of the crypto market. But how does it work?
DCA is a strategy in which you invest a sum of money periodically instead of all at once. For example, you can choose to invest 100 euros every month for a year instead of 1,200 in one go. The aim of this strategy is to buy as average as possible. In this way, you will incur fewer losses in the event of a major decline, as you can buy at a lower price.
On the website dcabtc.com you can see the return on this tactic. Despite bitcoin being 50% lower than last year, with this DCA strategy where you invest a fixed amount each month — you would only have had an 8% loss. So it is also a great way to protect your money somewhat in this bear market.
100 Euros in bitcoin per month for 12 months
If you had applied this DCA technique from 3 years ago, the portfolio would currently be 168% in the plus. History shows that the longer you do this, the bigger the return becomes.
The DCA widget
With this new widget from BTC Direct, it is finally possible to turn on ‘automatic saving’ in Ledger Live. This means you will automatically transfer an amount to your bitcoin portfolio each month.
Instead of putting money into your savings account each month (which only costs money) you can use this to save crypto to grow your money. If you believe bitcoin will rise in the coming years, this is a great strategy to start with. A bank account and a cryptocurrency wallet is all you need.
The minimum amount per bank transfer is 50 euros for ETH, USDC or USDT. This is only 30 euros for the rest of the coins. Furthermore, you can easily stop the transfers at any time by cancelling the transfer in your own banking environment. Do you want to start today? Then take a look at the DCA widget of BTC Direct within Ledger Live!