The 6 stages of cryptocurrency investment

Cryptocurrency investment has a lifecycle of its own.

From research to the time you bought your first coin and the rollercoaster ride that follows.

It could be exciting, depressing for some, and life-threatening for others.

But in it all, you must know exactly what stage you are at any time and play the right cards.

In this post, I will be discussing with you the 6 stages of cryptocurrency investment that I follow.

Which helps me remain sane, proactive, and profitable most of the times.

The 6 stages of cryptocurrency investment

  1. Information
  2. Research
  3. Buying
  4. Consolidation
  5. Diversification
  6. Portfolio management

Let’s discuss each of these stages below.

1. Information

This is the moment you either first heard about cryptocurrency or a particular coin.

Someone told you about it or you came across it while surfing the internet.

For example, you’re reading some content on and you discovered CST.

A token that you can stake (or hold) in your wallet and earn BCH with it every week.

This is the information stage.

And most likely it’s the first, second, or third time this information is coming to you.

You need to act on it.

And the first necessary step is to DYOR (do your own research).

2. Research

If you’re investing in crypto or buying any new coins without DYOR you will almost always lose money.

When you hear about cryptocurrency or a particular coin for the first time, ask lots of questions.

What is it all about? How does it work?

Who are those behind it?  What is the coin used for?

How is it different or better from the thousands of others in the market?

Don’t worry. You can never ask “too many questions”.

Find out all there is to know right now about it before you put your hard-earned money.

3. Buying

All research and no buying makes a good “pussboi”.

Please don’t be a pussboi.

If you do your research well, you will discover that there are more “shitcoins” than good ones.

The good ones are those with solid fundamentals.

Those with a competent team and solves real-life problems. And has good use cases.

These are the ones you should be buying.

Once you have bought a coin, you become an official rider of the roller coaster that follows.

Sorry I didn’t tell you before now.

Even “good coins” get their fair share of market manipulations.

Pumps and dumps. be prepared for all the excitements of pumps and depression of dumps that will follow.

This is normal and HODL should be your watchword in all cases.

You have to learn to HODL through all and any dips if you want to survive in this space.

Oh! And less I forget. It’s also ok to buy some of those “shitcoins” if “you know what you’re doing”.

They can make you rich or poor fast, and you should only play with them with your “risky dollar”.

The risky dollar is money you can afford to lose with a smile.

4. Consolidation

In a bull market, almost everything pumps. Even shitcoins.

Once the 10x profits start rolling in you can begin withdrawing from the shitcoins.

And putting all that crazy gains into projects with real fundamentals and use cases.

Thus consolidating your position and building a more solid crypto portfolio.

5. Diversification

Spreading your capital too thin across too many cryptocurrencies is not ideal.

“Wide diversification is only required when investors do not understand what they are doing.” ~ Buffett

That is why in the earlier stage, you’re advised to invest in a few solid projects and wait for their pump.

However, as your portfolio grows in size or dollar amount you may want to diversify a little.

Moving some of those profits into some other promising project isn’t a bad idea.

But you will need to establish how many is too many.

How many different coins can you follow their development and manage?

Not too many I guess.

So stay within your “self-defined limit”.

For me, it’s never more than 10.

And that’s if I even manage to get to 10 in the first place.

6. Portfolio management

You will think that at this stage, you’ve done all the work and it’s time to relax.


You have to track, balance, and rebalance your portfolio to keep it healthy.

The cryptocurrency industry is still very young and immature.

Some “good” projects you have invested in will die for one reason or the other.

This is normal. Not every business that existed 5 years ago is still here today.

It is the same with your crypto investment and that’s why you have to be vigilant.

Adapting and evolving with the market to stay profitable.

For example, most of you already know that the coins in my portfolio change very often.

Like weekly or monthly.

Though there are a select few I am confident to HODL for years.

The rest gets moved around, removed, shrunk in size etc, as the case may be to keep my portfolio healthy.


Your job as a cryptocurrency investor does not start and end with buying any of the coins out there.

You will have to watch and manage your portfolio to keep it healthy at all times.

And that means being aware of the happenings in the market.

And being proactive with buying, selling, adding or dropping coins in and out of your holdings.

The market is wild. That’s why you should never walk alone.

I invite you to join our telegram community of passionate crypto investors today.

Where we share knowledge, experience, ideas and opportunities together every day.

This way, you will be able to stay aware of all that is happening in the market and make your moves with precision.

Click here to join us.

4 thoughts on “The 6 stages of cryptocurrency investment”

  1. Yes with passing time now I realized that it’s not just hearing about a coin and buying it, you have to do your own research and still put the money that you can afford to lose and also wait patiently in the dips don’t panic and not leave every coin for years always watch and manage your portfolio I’m still in learning phase but doing quite good with this stuff 💜

    1. Wow what a wonderful piece you dropped here! I doubt if anyone could go wrong on crypto investment after reading this piece as a noob and inexperience crypto investor.

      However considering what you mentioned about CST slp token, one could say that CST is already soaring high by being able to pay weekly dividend on bch to it’s hodlers, that’s 3 steps ahead against other slp token who is currently not doing so.

      I will join the CST telegram group as you commanded may be this is another gem.

  2. Thanks for this informative article. Most people buy crypto buy recommendation of other people or by hearing somowhere without doing any research.
    This leads lost a lot of money and time. If we can apply the rules in your article then we can earn money and we can learn crypto basics very well.

  3. This is a great starting point article for beginners. I will recommend this to my friends who are starting to trade crypto! Everything is very well explained for starters 😎

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