Did you know that four months after its ICO, The Graph token prices had appreciated by more than 9600%? Are you also aware that the ERC-20 is currently trading more than 85% below the ATH set in February 2021? These two are excellent depictions of The Graph’s greatest but also highly risky feature, i.e. volatility. It shows you that just as you can easily make money with The Graph, losing it, all is even easier.
How then can you ensure that you retain as much as you earn with the ERC-20 token? It is simple, you need to start by learning as many ways of making money with GRT as possible. You then need to learn about all the ways that others have lost their GRT investments and come up with measures to guard against losing it in a similar fashion.
In this post, we will be introducing you to the 3 most lucrative ways of making money with The Graph. We will also tell you about the 3 common ways through which other crypto investors have lost their GRT investments. But even more importantly, we will share practical tips on how to guard your investment against these risks.
Ways To Make Money With The Graph (GRT)
First off, you need to understand that GRT is designed to serve as the native token for facilitating transactions on The Graph indexing protocol. But it has, for the most part, been taken up by crypto investors both as a speculative investment and a store of value.
That said, here are the three most popular ways of making money with The Graph.
1. Buy and hold
Also known HODLing, buy and hold is a form of long-term investing that involves buying GRT tokens today and holding on to them for years as you watch their value grow. It is one of the easiest and the most beginner-friendly methods of making money with The Graph. But before you go long-term on the altcoin, you need to ensure that it is a sustainable project and believe that its value will rise into perpetuity.
But just how much do you stand to make when buying and holding The Graph?
Well, if you had bought GRT worth $1,000 during its ICO in October 2020, the investment would have grown to $96,000 when it peaked in February 2021 and about $30,000 today. Moving forward, bullish forecasters are confident that The Graph’s value will appreciate by more than 3500% by 2030, growing your $1,000 today to $35,000.
In the long run, some crypto experts are confident that one GRT token will eventually break above $100, which would make the ERC-20 token a perfect retirement plan or inheritable asset.
You could also join the countless number of investors who are making a killing by trading The Graph tokens. This is a form of short-term investing that involves leveraging GRT token price volatilities. Essentially, trading The Graph involves buying GRT tokens when their price is relatively low and exiting the trade as soon as it turns profitable or starts posting a loss.
A typical GRT trader will hold onto a trade for a few seconds, minutes, hours, or days. We also have trend traders who buy the dip and ride the uptrend for months, only selling when the trade peaks or short the peak and close the trade when the altcoin dips. And therein lies the key difference between investing and trading, as the latter allows you to go long or short a trade.
But unlike investing, trading is not beginner-friendly but a preserve of highly experienced and risk-tolerant crypto enthusiasts. Just how much can you make trading The Graph? Well, assuming that you make an average 10% per week trading GRT, you will have grown your capital by a massive 520% at the end of the year.
Staking involves locking your GRT tokens in a smart contract-based investment program in return for interest or other rewards. These rewards and interests are usually in the form of extra GRT tokens, and staking services are provided by both The Graph network and third-party staking platforms.
When using The Graph network, you have the option of either delegating or staking your coins through the Web3 wallet. You could also stake these coins with third party digital wallets like MetaMask. In either case, the annual rate of return for the staked assets starts from 5%.
Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.
Ways To Lose Monsey With The Graph (GRT)
Here are the three most common pitfalls that have cost The Graph and other crypto investors money in the past and practical tips on how to avoid them.
1. Careless trading
Careless trading is arguably the most common way of losing money with The Graph. Since you are leveraging highly unpredictable price fluctuations, it is not uncommon for even the most experienced traders to get chiseled out and lose significant sums of money.
You will be referred to as a reckless trader if you trade without a strategy or assume the risk management tools provided by virtually all the crypto exchanges and brokerages. You are also trading recklessly if you do not invest in proper analysis and research tools.
How to prevent this: You can avoid losing money through reckless trading if you dedicate enough time to mastering the art of trading. You also need to come up with a winning strategy and learn to always take advantage of the risk management tools provided by your trading platform. Equally important, invest in advanced crypto analysis and trading tools that help you arrive at solid investing decisions fast.
Hackers are the greatest risk to crypto investing. Every year, different crypto industry watchdogs release shocking cryptocurrency crime reports detailing how a menace hacking has become to crypto investors. For instance, CiPherTrace reports that more than $681 Million worth of crypto was lost to hackers and other crypto criminals in the first half of 2021.
These typically target personal wallets or exchange vaults and breach their defenses before stealing crypto assets held therein. The most recent major hacking incident has to be the breach of Japan-based Liquid Exchange where cybercriminals got away with $90 million worth of crypto assets in August 2021.
How to prevent hacking: The safest solution to keeping hackers off your crypto jar is getting your GRT tokens off online wallets and exchanges. Move them all into a reliable hardware wallet that stores their private keys offline.
Don't Miss: Is The Graph (GRT) Safe?
3. Crypto scams
Crypto scams are on the rise at the moment, as reported by such crypto security agencies as CipherTrace and regulatory agencies like the Federal Trade Commission (FTC). The type of scams are also growing by the day as crypto scammers come up with even more innovative ways of conning the victims of their GRT tokens and other crypto investments.
The most common today include investment scams like Ponzi, pyramid, and other MLM schemes, phishing scams perpetuated through fake websites and malicious links, crypto pump and dump schemes, and tech support scams.
How to prevent this: You can avoid most of these crypto scams by carrying out due diligence before engaging any individual or program in the crypto-verse. They can also be avoided by taming your greed because the typical target for these scammers are gullible investors who they entice with the promise of above-average ROI.
More importantly, you need to keep tabs with the crypto security blogs and websites as well as financial regulatory agencies that not only report about emerging crypto scams but also provide tips on how to detect and avoid them.
Bottom Line: How To Make Or Lose Money With The Graph (GRT)
You can make money with The Graph when you invest when you leverage the altcoin’s volatility through trading, and when you stake on either The Graph network or third-party DeFi protocols. The invested capital and any profits made here can then be lost through reckless trading, to hackers, or to crypto scammers.
The secret to retaining as much as you make with The Graph lies in learning how to detect and prevent the different risks to your GRT token investments. Before you buy your first and stack more GRT tokens, go through this guide again and complement it with crypto-security posts to learn how to make and retain wealth with The Graph.