Short-Term Crypto Trading vs Long-Term Holding

Crypto investments have turned the whole financial system upside down. Many budding investors are planning to make their first investments in this field. However, due to a lack of knowledge and skills, they often feel overwhelmed. Hence, if you also wish to jump into this investment system and make quick money, don’t get confused and rely on this guide. Here, we’re going to discuss more about short-term and long-term trading.

This will help you understand which investment strategy is better for you. If you’re willing to make quick profits, you can go ahead with a short-term investment. On the other hand, if you believe in holding your assets because their value will grow over a time period, then “Long-term holding” is a great choice for you. However, if you are confused between the two, we can take a look at both of them one by one and have in-depth insights into the same.

However, you can decide between the two only if you are sure about your goals, risk level, knowledge, and time. Now, let’s get back to the main point.

Long-term crypto investment (HODLing)

HODLing is another name for buying and keeping your assets for months/years and wait for its value to increase. This helps you shift your focus to long-term growth instead of worrying about price fluctuation on a daily basis. Some common strategies that you can take into consideration for long-term investment include the following:

HODLing- This is one of the best ways to buy crypto and hold it. This has the potential to grow in value with time.
Dollar-cost averaging- Under this category, you are supposed to invest a fixed amount regularly. This will help you invest a fixed amount regularly while reducing the risk of any price fluctuations.
Staking– Within this category, you will lock your crypto for a specific period and earn rewards or generate passive income through this.

Why does one choose long-term investment?

Individuals who take part in long-term investment choose this strategy because:

They see their crypto holdings as digital gold, which will increase in value over a period.
Besides that, they do not want to get stressed from everyday price changes.
This investment has a high probability of strong growth over time.

Some great examples of long-term crypto growth are-

Bitcoin (BTC): Around $100 in 2013 and crossed $100,000 in 2025.
Ethereum (ETH): Started around $1 in 2015 and later reached thousands of dollars.
Solana (SOL): Once under $2 and later surged above $100 in strong market cycles.

What is short-term crypto trading?

Short-term trading means buying and selling crypto on a frequent basis. It can sometimes take place within minutes, hours, or days with the aim to earn profit from price changes.

Day Trading- Buy and sell within the same day.
Swing Trading- Hold for a few days or weeks to catch short trends.
Scalping- Make many small trades in one day for small profits.

Why does one choose a short-term investment?

Here are the reasons why individuals might choose short-term investment strategies based on their perspective, needs, and goals:

Opportunity to make quick profits.
Crypto prices move fast.
It’s active and exciting.

Criteria to choose the right strategy

Consider the following factors if you wish to choose one of the investment strategies:

Risk Tolerance: Can you stay calm during price drops?
Time: Can you check charts daily, or do you prefer a relaxed approach?
Knowledge: Short-term trading needs technical skills. Long-term investing focuses more on understanding the project.
Money Available: Traders need quick access to funds. Long-term investors can invest slowly using DCA.

Tips for your first investment

No matter which strategy you choose, always take into consideration the following tips:

Start small
Do your own research.
Use a secure and trusted exchange.
Keep learning before investing.

Conclusion-

Both long-term investing and short-term trading can work. There is no “perfect” strategy. If you’re new, begin slowly and choose what fits your lifestyle. Whether you hold for years or trade daily, patience and learning are key to success in crypto. You can also opt for “Hybrid Strategy.” This means holding strong coins like Bitcoin and Ethereum for the long term while trading smaller coins for short-term gains. This way, you can spread risks and invest without losing your peace of mind.

FAQs:

Is it better to hold crypto long-term or short term?

This completely depends on your goals, investment capital, and other factors. If you hold your crypto for a longer duration, you can expect a high value. However, short-term investment is good to avoid any risks.

What is the safest way to hold my crypto?

Use an offline wallet (a hardware wallet), which works as a cold storage, keeping your crypto safe from any kind of online exposure.

Is it better to keep crypto on a wallet or an exchange?

Rather than keeping your crypto on an exchange, you should store it in a safe crypto wallet. A cold storage is recommended.

What is the 2% rule in trading?

According to this rule, you should not risk more than 2% of your entire spending.