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How to Invest In DASH In 2021

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Dash (DASH) is one of the many cryptocurrency contenders that have been strongly influenced by the household name that is Bitcoin. Dash was originally formed when it was forked from the Bitcoin protocol, launching as Xcoin in 2014. 

The project was later rebranded as Darkcoin, before receiving its current moniker in 2015, as a portmanteau of 'digital cash'. After settling on this new name, Dash began to escalate in value, and even exceeded a market capitalisation of $4 billion during 2018.

Since then, the price of Dash has receded somewhat, but the crypto coin remains comfortably within the top 50 tokens in terms of market cap. This guide will discuss how to invest in DASH and will also discuss some popular strategies for investing in this cryptocurrency. 

4 Ways to Invest in Dash

There are a variety of ways available to invest in Dash, but in the following section, we're going to examine four of the most popular and commonly used strategies. All these methods can be used with or without leverage.

1. Buy Dash Through an Exchange

The first method to buy Dash is probably the most popular. Cryptocurrency exchanges have sprung up online in large numbers, and these enable investors to purchase cryptocurrencies, alongside other equities and commodities. As more and more tokens have been mined in the top cryptocurrencies, so they have appeared in these exchanges.

While digital exchanges typically include storage functionality as part of their overall packages, it is always advisable to opt for a hardware wallet. This will provide additional security when storing Dash and other cryptocurrencies.

Crypto wallets that feature online connectivity are referred to as hot wallets since the funds are always accessible. The best advantage of a hot wallet is that they keep your digital currencies available while providing a decent level of security. They aren't as secure as cold wallets but provide better accessibility and user-friendliness. Hot wallets are more likely to be targeted by hackers and cybercriminals since they can be accessed through online exploits. Hardware wallets are cold wallets.

Some of the hardware wallets compatible with Dash include the following:

To purchase Dash, it will first be necessary to join a cryptocurrency exchange. This requires a relatively straightforward registration process to be followed, and part of this involves confirming your identity as an investor. This usually requires providing some government documentation, along with some proof of your current address.

Registration procedures for cryptocurrency are usually compliant with the Know Your Customer norms. This refers to the process of verifying the identity of customers, and references the regulated bank customer identity verification practices, used by financial institutions to assess and monitor customer risk. 

Our recommended exchange

There are a variety of cryptocurrency exchanges available for Dash purchases, but in this section would like to give you our personal recommendation.

1
Min. Deposit
$50
Exclusive promotion
Our score
10
Accepts customers from the USA
Offers 15 crypto coins to buy&sell including BTC, LTC, ETC, NEO and more
Trade on the world's leading social trading and investing platform
Start Trading
Payment Methods:
Wire Transfer, Bank Transfer
Full Regulations:
CySEC, FCA

2. Buy Fractions of Dash Through an Exchange

The minimum fraction of Dash available, according to the developers of the altcoin is one-millionth of one Dash. This has been dubbed the ‘Duff’, after the creator of the cryptocurrency, Evan Duffield.

3. Trade Dash Through a Broker

Another possible purchase method for trading Dash is via a cryptocurrency broker. Considering the popularity of cryptocurrency as a trading mechanism, these have become widely available online. 

Brokers act as intermediaries between the investor and the market, facilitating the purchasing and selling of cryptos. Typically, brokers also bring a lot of knowledge and experience to the table, and also frequently offer extra services as well.

It is important to choose a Dash broker diligently, and ensure that the credentials of this platform are fully proven. Brokers should be conversant with regulatory measures for financial services, and you should also ensure that you can access your crypto broker platform via both desktop and mobile applications.

Our recommended broker

There are a wide variety of brokers available, but in this section, we will offer our personal recommendation.

1
Min. Deposit
$50
Exclusive promotion
Our score
10
Accepts customers from the USA
Offers 15 crypto coins to buy&sell including BTC, LTC, ETC, NEO and more
Trade on the world's leading social trading and investing platform
Start Trading
Description:
eToro offers a wide range of cryptos, such as Bitcoin, XRP and others, alongside crypto/fiat and crypto/crypto pairs. eToro users can connect with, learn from, and copy or get copied by other users.
Payment Methods
Wire Transfer, Bank Transfer
Full regulations list:
CySEC, FCA

4. Invest in a Dash ETF

Another option for cryptocurrency traders is to opt for an ETF (Exchange Traded Fund). These are frequently used to trade other assets, equities, and commodities, and now they have been welcomed into the cryptocurrency fold as well.

ETFs can also be used to combine what would be a diverse set of cryptocurrencies into a solitary tradable asset. This is often occurred in other markets, with baskets of commodities and currencies being drawn together.

ETFs trade in the same way as common stock on an exchange, being subjected to changes in price throughout the day as investors buy and sell the token. 

ETFs are often seen as a better and passive method for new investors to enter the crypto market, by trading a so-called basket of different digital tokens. However, regulators in the US have denied multiple attempts to offer products of this nature on its exchanges, so they are somewhat location-specific.

5 Dash Investment Strategies

There are a wide variety of investment strategies available for Dash, so in this section, we will discuss five of the most popular and commonly used. These cover all options in the cryptocurrency space, regardless of leverage and level of experience.

1. Buy and ‘Hodl’ 

What is it?

Buying and hodling has been a popular strategy in the stock market for decades, and it is also a valid strategy for Dash and other cryptocurrencies. When adopting a buying and holding approach, investors purchase a particular asset, and then hold onto it for a period of time, in the hope of benefiting from price discovery.

Buying and holding can be seen as a long-term strategy, with investors holding on to an asset for a significant period of time. Those who are attracted to buying and holding Dash fundamentally believe in the long-term value of the currency, and are effectively asserting that it will escalate in value eventually. 

What is the benefit of using this strategy?

The obvious benefit of buying and holding is that it is a low-maintenance strategy, requiring very little input from an individual investor. Buying and holding really only requires an initial purchase, and doesn't even necessitate a huge amount of market monitoring.

In many ways, buying and holding will be suitable for those who are beginners in the cryptocurrency niche, as it doesn't require the sort of active market participation involved in other strategies. 

Buying and holding also enable an investor to take possession of a physical asset, which can then be used for other purposes. Dash is continually developing different use cases, so this could prove to be useful for those invested in the potential of this token.

2. Day Trading

What is it?

Day trading is another common stock market practice, which has now graduated to the cryptocurrency niche. Day trading takes place over a 24-hour period, in which traders can complete a raft of small trade, intended to capitalise on tiny fluctuations in the market.

Traditionally, day trading has been carried out in the foreign exchange and stock markets more than any other, but it is now expanding to other spheres as well. Anyone wishing to participate in day trading must be well-educated, while a significant amount of capital is usually advisable. Day traders are using leverage and a variety of short-term trading strategies to effectively trade in the market.

Scalping and range trading are commonly used by day traders, as they look to make profits in a competitive and fast-moving market. Day traders will also typically pay heed to items of news that can impact on the market, such as announcements from governments and fluctuations in interest rates.

What is the benefit of using this strategy?

The obvious advantage of day trading is that it enables investors to make a profit in an extremely short timeframe.

Conversely, it should also be noted that day trading is rather risky. It requires an immense knowledge of the markets, and a disciplined trading strategy. It is definitely not recommended for beginners to cryptocurrency trading, or markets in general.

However, there are other advantages to day trading as well. One is that day trading tends to provide investors with better leverage than holding positions overnight. 

3. Shorting

What is it?

Shorting effectively involves making a bet that a token will decline in value. Those who choose to short or short sell a particular equity, commodity, or cryptocurrency believe that it will diminish in price in the foreseeable future. If this does indeed occur, an investor will generate a profit, whereas if it increases in value then an investor will have to suffer a loss.

Shorting will attract people who are sceptical about Dash and other cryptocurrencies. However, even those who believe in the crypto niche can engage in short selling over a shorter period, and consequently make money if this is timed correctly.

What is the benefit of using this strategy?

The obvious advantage of shorting is that it enables traders to make a profit even in a bear market for cryptocurrency. Short selling can also be used as a hedge against other investments. We will discuss hedging in more detail later in this article.

4. Using a Trading Bot for trading

What is it?

Another option for cryptocurrency investors is to take advantage of the algorithmic traders that are now widely available. Trading bots are essentially auto-trading software, programmed to automatically conduct trades on behalf of investors.

Trading bots are based on sophisticated algorithms, which monitor the market and then make decisions based on the vast amount of data that they have collected and analysed. Trading bots are based on artificial intelligence and machine learning techniques, and this has already proved to be hugely successful in a wide variety of fields, not merely cryptocurrency investment.

What is the benefit of using this strategy?

The benefits of using a trading bot is that it automates the entire process of the cryptocurrency investment, removing any need for a user to participate whatsoever. This can be extremely useful if you intend to invest in Dash, but don't really have the time to monitor the market accurately.

Trading bots also remove emotion from the process of trading, which can be hugely valuable. Algorithmic traders are also able to offer a speed and quantity of data analysis that is impossible for human traders, while trading over periods of time that would equally be unfeasible.

There is no doubt that the trading bots remain an excellent way for beginners to enter the cryptocurrency market, and to test the water in this exciting investment space.

5. Hedging Dash

What is it?

Another option for cryptocurrency investors is to hedge Dash. This typically involves making other investments as protection and insurance against Dash diminishing in value. The two investments are intended to balance one another and protect the investor against market risk.

While Dash itself could theoretically be used as a hedge as well, it is far more likely that investors would choose to use another asset as a hedge against a decline in the price of Dash, owing to the relative volatility of the cryptocurrency market.

What is the benefit of using this strategy?

The obvious benefit of hedging is that it represents a safety-first strategy. This is where the term ‘hedging your bets’ is derived; from attempting to protect yourself from undesirable market conditions in trading. All institutional investors will tend to use hedging strategies on a regular basis, and it certainly merits consideration when trading Dash.

Buy Dash Today!

What to Consider Before Investing in Dash

Before investing in Dash, or any other cryptocurrency, it is important to take into consideration certain issues. So in this section of the article, we're going to examine some of the most important factors that can impact your Dash investment.

Fees

According to bitinfocharts.com, the average transaction fee for Dash is between $0.20—$0.30, whereas it is in the range of $2—$5 for Bitcoin at the time of writing. It is thus much cheaper to transact using Dash coin, as compared to Bitcoin currently.

Exchanges also tend to charge fees on Dash transactions, with Binance levying a 0.1% charge at the time of writing.

Risks

Although there are huge opportunities for profit in the cryptocurrency space, it is also important to remember that there are risks involved with investing as well. 

The first of these is the fact that the cryptocurrency marketplace remains relatively volatile. While this means that it is possible to make massive profits in a short timeframe, it is also an unpredictable market, in which it is equally possible to lose money rapidly. Investors should definitely tread carefully before opting for Dash or any other cryptocurrency, and ensure that they are well-informed in altcoins generally.

Cryptocurrency also remains fairly unregulated, despite some efforts in this direction by governments and central banks. This is not necessarily a massive problem for those looking to profit, but it may be a dissuading factor for some cautious investors.

There are potential issues related to hacking and human error with cryptocurrencies as well, and Dash is definitely susceptible to these problems. However, it should also be noted that all investments are subject to potential theft, and this is nothing particularly unusual to cryptocurrency.

Nonetheless, crypto tokens can also be discontinued due to developer decisions. This is something else to take into consideration, as this can lead to a loss of investment.

Finally, the CFD contracts that are often used to trade cryptocurrencies can be considered relatively risky investments. Those choosing to invest via CFD could find themselves heavily leveraged, and this can sometimes lead to significant losses.

Payment methods

There are several payment methods possible with Dash, with virtually every fiat currency supported, and further options such as PayPal, Scrill, and Neteller also available. You can also use the market-leading Bitcoin and altcoins to purchase Dash.

Why Invest in Dash?

There are several compelling reasons to invest in Dash. Firstly, the price per Dash token has doubled during 2021, and it had tripled at one stage during the calendar year. Cryptocurrencies generally have been in a bull market, and many people believe that they will escalate in value further still in the future. DASH is trading at $292 at the time of writing.

Dash has also done a decent job of solving Bitcoin's scaling and consensus problems, which provides excellent upside for the token. With a development budget in excess of $2.5 million already in place, it is clear that Dash will benefit from improvements in the future as well.

Another area where Dash has been praised is with regard to privacy, while the developers of the token have also aimed to force mass adoption in a short timeframe. 

Summary of Investing in Dash

Dash is one of the brightest new wave cryptocurrencies, having established itself as a decent performer in the volatile market.

With the combination of excellent privacy and state-of-the-art performance, Dash delivers much of the ethos that was always associated with cryptocurrency since the advent of Bitcoin.

Many investment strategies were discussed in this guide such as day trading, buy and hodl, and the use of trading bots. Investors can also use shorting strategy to benefit even in a declining market. New investors must manage risk by making use of strategies such as hedging.