What Are the Exit Strategies That Can Be Implemented in Crypto?
An exit strategy is something that needs to be considered. Similar to any investment, many founders in businesses also think about exit strategies: whether it's by selling shares through an IPO or passing on their owned shares. This also applies in the crypto market because the crypto market operates in a cycle where every time there is a cycle of increase, there is also a cycle of decrease. Many people do not accept this fact until their investments ultimately suffer losses. So, what exit strategies can be applied in crypto investment? 1 Exit According to Market Cycle. The crypto market has always experienced the "end" of 500 days after the halving event which according to previous data has always been the "peak" of the market and the price of Bitcoin in previous cycles has always experienced a decline of more than 50%. By sticking to the timeline, near the end of the cycle we can "trimming" some of the positions we have if we are satisfied with the profits we get in the market. There is no perfect exit but at least we can start realizing profits. 2 Apply Moon Bag Strategy. This strategy is suitable for those of you who have a long-term conviction about an asset, but are also quite conservative. This strategy is applied by selling 50% of the position after an asset has risen by 100% or more. Thus we still have exposure to an asset and our capital has "returned". This can be done by selling 50% of Bitcoin at the end of the cycle after buying from 2022 - 2023 and has experienced an increase of hundreds of percent. Suppose the price is still going up again: we still have half. Meanwhile, when crypto winter comes and Bitcoin drops by more than 50%, our capital is safe and there is 50% free that we can buy again when the price has corrected deeply. 3 Gradual Exits at Psychological Levels. Psychological numbers can also be used as a "benchmark", for example, selling a few tens of percent when the price is in a certain area. Let's say you start selling 30% when the price is at $100K, then 50% when it's at $120K, and so on. The lack of this strategy is: there is no guarantee that our exit grid will be reached and the price is heading towards that number. 4 Implementing "Trailing Stop". Trailing stop is a method by which we increase our stop loss, as the price increases. This technique can maximize profits while having enough "sense of security". This technique is relatively more advanced compared to other techniques that are much simpler. This technique requires a high understanding of the market structure as well as good execution.
This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.
What Are the Exit Strategies That Can Be Implemented in Crypto?
An exit strategy is something that needs to be considered. Similar to any investment, many founders in businesses also think about exit strategies: whether it's by selling shares through an IPO or passing on their owned shares. This also applies in the crypto market because the crypto market operates in a cycle where every time there is a cycle of increase, there is also a cycle of decrease. Many people do not accept this fact until their investments ultimately suffer losses. So, what exit strategies can be applied in crypto investment?
1 Exit According to Market Cycle.
The crypto market has always experienced the "end" of 500 days after the halving event which according to previous data has always been the "peak" of the market and the price of Bitcoin in previous cycles has always experienced a decline of more than 50%. By sticking to the timeline, near the end of the cycle we can "trimming" some of the positions we have if we are satisfied with the profits we get in the market. There is no perfect exit but at least we can start realizing profits.
2 Apply Moon Bag Strategy.
This strategy is suitable for those of you who have a long-term conviction about an asset, but are also quite conservative. This strategy is applied by selling 50% of the position after an asset has risen by 100% or more. Thus we still have exposure to an asset and our capital has "returned". This can be done by selling 50% of Bitcoin at the end of the cycle after buying from 2022 - 2023 and has experienced an increase of hundreds of percent. Suppose the price is still going up again: we still have half. Meanwhile, when crypto winter comes and Bitcoin drops by more than 50%, our capital is safe and there is 50% free that we can buy again when the price has corrected deeply.
3 Gradual Exits at Psychological Levels.
Psychological numbers can also be used as a "benchmark", for example, selling a few tens of percent when the price is in a certain area. Let's say you start selling 30% when the price is at $100K, then 50% when it's at $120K, and so on. The lack of this strategy is: there is no guarantee that our exit grid will be reached and the price is heading towards that number.
4 Implementing "Trailing Stop".
Trailing stop is a method by which we increase our stop loss, as the price increases. This technique can maximize profits while having enough "sense of security". This technique is relatively more advanced compared to other techniques that are much simpler. This technique requires a high understanding of the market structure as well as good execution.