Bitcoin is now trading over $30,000 and the price is continuing to go through the roof. Did you buy before the latest boom? If you did, you’ve already made a healthy profit, but you are probably a little nervous too. If there is one word that everyone would agree characterizes the crypto markets, it is “volatility.” The price has seen some incredible jumps in the last decade, but unfortunately these tend to be followed by steep drops in value.
So, now you’ve made some fast money on the BTC rise, what is the best way to secure your profits and how can you take a safe but lucrative next step with your Bitcoin?
How Can I Profit from My Bitcoin?
There are many ways to earn a profit from your Bitcoin and one of the most secure is known as HODLing. The principle of HODLing or “Holding On for Dear Life”, is that while BTC can experience dramatic ups and downs, over the long term, it is on an overall upward trajectory and if you just place your BTC in a wallet and leave it be, it will grow in value over time. The advantage of this approach is that you are safely riding out the short-term volatility of the markets, but the disadvantage is that your savings are sitting idle, and doing nothing in a wallet, while they could be working hard on your behalf.
At the other extreme, there is day trading. Without question, if you want to make a quick profit, short-term, day trading can be an attractive option. If you can get in and out of the market quickly, making a profit on the frequent market fluctuations, there is a lot of money to be made. This is undoubtedly lucrative but the downside is the high risk. Just as you can make a fortune, in no time, you can lose it all equally fast with a mis-timed move. Also, this is an exceptionally time-consuming approach that involves a wealth of market research and hours monitoring the exchanges, analyzing real-time data and executing trading orders.
How Can I Eliminate the Risks?
While you can’t ever completely do away with risk when trading crypto assets, a crypto arbitrage strategy will enable you to reduce it to very close to zero. Basically, it offers the safety of HODLing and the profitability of day trading.
Crypto arbitrage is a type of investing that doesn’t leave you vulnerable to the extreme volatility of the digital currency markets. Instead, it takes advantage of price inefficiencies across crypto exchanges. For a short time, a currency can be available at different prices at the same time. So, to make a profit, a crypto arbitrage trader will buy the coin on the exchange where it is being offered at the lowest price and then immediately sell the coin on the exchange where it is being offered at the highest price to earn a profit on the spread.
Investors tend to use an automated platform, since no human being can achieve the level of speed and a multi-functioning capability required to successfully perform this type of trading, with the minimum of risk. An algorithmic trading system will scan a vast number of exchanges simultaneously, around the clock, tracking multiple crypto currencies to identify and then instantly exploit the brief windows during which a price difference exists before the market has the chance to adjust and the inefficiency resolves itself.
For example, ArbiSmart, one of the best-known, licensed crypto arbitrage platforms, is connected to 35 different exchanges which it monitors 24/7 for crypto arbitrage opportunities, to generate profits reaching up to 45% a year. The AI-based platform does all the work for you so you just sign up, deposit funds in your account and the rest is taken care of automatically.
How Can I Make a Better, More Reliable Profit?
As we have seen, the crypto exchanges can be highly unpredictable, which is why the reliability of a crypto arbitrage strategy is the preferred choice of so many investors.
At ArbiSmart for example, the platform guarantees profits starting at a minimum of 10.8% and reaching as high as 45% APY. A huge benefit, beyond the incredibly lucrative ROI being offered, is that by looking at the company Accounts page, based on your deposit amount, you know exactly what you are getting and where your Bitcoin profits will be in a month, 6 months, a year or more.
The ArbiSmart platform also offers compound interest, which will further boost your bottom line and then of course there is the increasing value of the native token, RBIS. Since the RBIS token was introduced a couple of years ago, it has increased in value by more than 205%. Projections based on the company’s steady, current rate of continued growth, predict that the coin will have risen by 3,000% by the end of 2021. You can withdraw your funds in BTC, ETH or EUR at any time, but as long as your funds remain in your account in RBIS, your money is earning capital gains in addition to crypto arbitrage trading profits.
How Safe Are Crypto Arbitrage Platforms?
Crypto arbitrage is considered one of the lowest-risk automated investment strategies out there, used not only by the crypto community but also by traditional hedge funds, investment firms and financial institutions. However, as with any financial technology, the reliability of the platform performing the investing depends primarily on the credibility of the company behind it.
The clearest indication of the trustworthiness of a crypto arbitrage platform is whether or not it is licensed and regulated. In fact, in such an under-regulated financial space, this is an absolute MUST. For example, ArbiSmart is FIU licensed, meaning that it is regulated across the EU. This is of major significance since compliance with the license involves regular oversight and adherence to rigorous data security protocols. Regulatory requirements include submitting to ongoing external auditing, providing coverage for all client funds, maintaining a secure, functioning platform, holding sufficient operational capital, separating client and company funds and implementing strict KYC/AML procedures.
Another means of determining how safe a platform will be, is to see how extensive and accessible their support operations are. If you can’t get hold of a real person to hold a company accountable for any problem and receive assistance when needed then you are better off investing your capital elsewhere. Here too, ArbiSmart is setting a high standard, with multiple support channels including Twitter, Telegram, Messenger, email, phone and Whatsapp.
One thing that is completely guaranteed in the crypto world is that the community is never shy about sharing experiences and giving opinions on different investment opportunities. So if you want to be absolutely confident in your choice of platform, see what people have to say about the company across various social media channels and forums. Then, do a google search of the company and see what the industry press has published about them. Have there been any legal issues? Is the company well established and positively regarded? Finally, you can also look at consumer review sites, such as Trustpilot, for example, where ArbiSmart has a 4.3/5 rating.
While the recent surge in the price of Bitcoin presents exciting opportunities for investors, mitigating your risk is essential if you wish to hold on to the gains you have already made and a proactive investment approach will be necessary to increase your profit further. Crypto arbitrage is a great way to make your BTC work for you with zero effort required, while protecting the profits you have already earned.
*This article is a paid sponsorship. The Cryptonomist didn’t write the article nor tried the platform.