What defines an expensive and cheap cryptocurrency?A lot of traders are considering whether to opt for an expensive or cheap cryptocurrency option. One often hears the following: “I would rather buy a cheap cryptocurrency and have more coins.”
It is important to remember that the terms “expensive” and “cheap” have different meanings for different people. Some investors may regard Ethereum at R22 000 as cheap whilst others may feel it is out of reach. An expensive and cheap cryptocurrency may have different monetary values for different investors. However, in general, Bitcoin is regarded as an expensive cryptocurrency whilst altcoins are considered cheap cryptocurrencies. For the simple reason that Bitcoin is incomparably more valuable and popular.
Which is best to buy?There are pros and cons to each. Buying an expensive crypto like Bitcoin is beneficial for long term hodlers as one is guaranteed that the price will surge. You don’t even have to do anything with Bitcoin whilst hodling. It is an easy and safe option. The downside is that Bitcoin will not necessarily increase by such a high percentage as what some altcoins can.
Buying a cheap cryptocurrency could mean it is a relatively new project that is not as stable as Bitcoin. These are heavily susceptible to market volatility. On the other hand, some altcoins can be considerably more profitable than Bitcoin.
For new traders it is important to wrap your head around the concept that it is not about the number of tokens you have, but the percentage of profit you stand to make. For example, if you have R10 000 worth of Bitcoin and the price goes up by 20%, you will make R2 000 profit. Profits are not determined by the number of coins you hold, but by the capital you invested in the coin. The same goes for Ethereum. You may not have R22 000 for one Ether but if you buy R10 000 worth of Ether and make 30% profit, its great money! Congratulations.
The golden rule in cryptocurrency investing is always to DYOR. A cheap cryptocurrency can surge 20% and an expensive cryptocurrency can surge 20%. Regardless which one you own; you will make 20% profit.