Crypto Recurring Investments: What Are They and What Are Their Benefits?

When you take your first virtual step into the world of cryptocurrency, it feels like there are endless opportunities and options. And that’s true; there are. And sometimes, you find an asset that’s a great match and want to grow your position.

Crypto Recurring Investments: What Are They and What Are Their Benefits?

There’s just one little problem: You can’t afford to make a large purchase. If you’ve ever been in that position or are facing it now, we’d love to talk about an option known as recurring investing. Keep reading for details that could potentially change your investment plans.

What Is a Recurring Investment?

A recurring investment (or “recurring buy”) is when you purchase a prescribed amount of your favorite assets over time at specific intervals. You can do it in the stock market and the crypto market as well.

How Does a Recurring Investment Work in Crypto?

Speak with a representative from the exchange you’re working with. They will have you decide on a specific dollar amount you want to invest. Next, you will select the coin you want to direct those dollars to.

Next, you will need to decide on the frequency of purchases. Let’s use bitcoin (BTC) as an example. Let’s say you wanted to set up an automatic and recurring purchase of $200 of that currency every four weeks. This would help you slowly amass your supply of bitcoin over time.

What Are the Main Benefits of Recurring Investment in Crypto?

There are four main benefits to recurring investment/recurring buying for cryptocurrency: consistent portfolio growth, more effective risk management, removing emotional error, and diversification. Let’s go over each benefit in a little more detail.

1. Consistent Portfolio Growth

When you set up a recurring investment, your portfolio can spread its wings slowly over time. As the projects you continue to invest in develop, you won’t miss out on their evolution as you accumulate currency consistently.

2. More Effective Risk Management

One of the first things you learn when investing in cryptocurrency is how volatile the market is. That means values can skyrocket or crate very quickly. With recurring investments, you’re not dumping cash into a single asset — funds that could disappear soon.

With smaller, regular contributions, you risk less. If your means fluctuate, you can grow or shrink the amount you put in each time. That control can help prevent significant losses and increase your comfort level.

3. Removes Emotional Error

Your emotions are not your friend when investing in cryptocurrency. For example, some people panic-sell and come to regret it later. Fear, greed, and euphoria have been the downfall of too many people.

But emotions are taken out of the equation regarding recurring investments. You’ve automated it and can then step back and let it do its thing. This allows discipline to become part of the equation instead of emotions.

4. Diversification

You can afford to take more chances on various currencies with recurring investing. Each investment is small, which means your risk exposure is negligible. You can slowly diversify your portfolio by taking small bites with each coin. And this, in turn, lowers your risk of losing a lot when one of the projects you invested in is ultimately toe-tagged.

How Can You Set Up Recurring Crypto Investments?

You can handle many recurring buys in the crypto market through the web platforms or apps of whichever exchange you decide to use. If you have questions, talk to a representative from that particular exchange.

If you want more details to give you a clearer picture of what to expect, we can provide that. For example, let’s take a look at how to set them up:

  • Step 1: Choose which crypto you want to invest in and enable the option for recurring buy.
  • Step 2: Pick your fiat currency. (For those who don’t know, fiat money is currency that is backed by a government. That means it’s regulated Now, these currencies aren’t backed up by a physical commodity, like silver or gold. Instead, it’s the government who issued the money that backs it.)

For the Binance exchange, you can choose from more than 40 fiat currencies.

  • Step 3: Set up how often you want to invest. For the Binance exchange, you can pick between weekly, bi-weekly or monthly. It even lets you pick the specific day and time you want for your recurring buy.
  • Step 4: Choose how you’re going to make these purchases. Generally, Visa and Mastercard are accepted.
  • Step 5: Confirm that everything with your order is correct. But you’ll need to do it within a minute. (Yep, that fast.) Why? Because afterward, the price and amount of crypto will be recalculated. The market is always on the move!

If you’re looking to level up your portfolio with automated investing, Pluto can help. Our free tools can help you balance, diversify, and grow your portfolio.

Which Exchange Is Best for Recurring Investments?

As we mentioned, you can handle recurring investments through different exchanges' apps or web-based platforms. Each has its set of directions for setting up these recurring buys. If you’re curious about where to turn, here are our recommendations.

Binance

Ofir Beigel described this as “probably the easiest and cheapest way to go” regarding cryptocurrency exchanges.

Binance has been applauded by the crypto community, which is a good sign. It also accepts investors from across the globe. Finally, it partners with third-party organizations to allow credit card and wire transfer purchases of crypto at a premium.

Crypto.com

This exchange out of Hong Kong is enormously popular, with more than 10 million customers across the planet. Fees are capped at 0.40%, and those fees fall with large trading volumes or a significant holding of the CRO currency.

It is known for having a plethora of features beyond just buying and selling. While these extra capabilities are exciting for crypto veterans, they may be overwhelming for novices.

Gemini

This is an excellent exchange for casual cryptocurrency investors. It features low minimum trade amounts and has a quick setup and straightforward interface that can comfort investors new to the game.

While some of its fees are a notch higher than other exchanges, it has excellent security features.

CoinBase

Nerdwallet hails CoinBase as one of the top cryptocurrency exchanges in the United States. The interface is easy to use but has various features for crypto veterans.

It also offers more than 170 tradeable cryptocurrencies for customers in the United States, more than many other exchanges.

The Bottom Line: Are Crypto Recurring Investments Worth It?

Setting up recurring investments can be a wise choice. It’s incredibly strategic for those with limited funds to invest or people who want to diversify their portfolio with much caution. It reduces your risk exposure and can also wipe out the effects of emotional reactions, which have ruined others.

If you are interested in automated investing, we can be a vital asset to your success. Pluto is an investing app that helps you automate investing in stocks and cryptocurrencies by building a portfolio of "strategies" or rules for when to buy and sell.

With our app, you can quickly build a portfolio of strategies to watch your investments and make better decisions with your own rules like “if bitcoin (BTC) dips below $20k, then buy.”

We would be honored to have a conversation with you without hinting at obligation. We just want to share how we can help you strategically accumulate wealth.

If you enjoyed this blog entry, please be sure to give our full blog a look, as we cover a wide variety of topics that can arm you with the knowledge to grow as a crypto investor.

We also have a frequently asked questions section that can give you a sharper picture of what we’re all about. And finally, check out some videos on our YouTube page that will engage and educate you.

Sources:

Recurring Buys: Crypto, Stocks, and More | Gemini

Crypto Recurring Investments: Benefits and How to Start | Binance Blog

Binance Review - 5 Things to Know Before Signing Up (2023 Updated) | 99 Bitcoins

Crypto.com Review 2023 | Investopedia

Gemini Review 2023: Pros, Cons and How It Compares | NerdWallet

Coinbase Review 2023: Pros, Cons and How It Compares | NerdWallet