Survey: When Professional Traders and Newbies Trade Cryptocurrencies the Most

Newcomers to cryptocurrency trading are more active on weekends, while professional investors and traders pay the least attention to trading on the weekend, according to a survey from Overbit platform.

The pandemic and mass quarantines have made this trend more pronounced, as now the 24/7 crypto market has become more accessible in terms of free time. This information helps to understand when you should most often expect increased volatility in trading – that is, volatility in coin rates. Let’s talk about the situation in more detail.

The pandemic has indeed made a difference in what is happening inside the world of cryptocurrencies. As the restrictions forced people to stay at home more and spend less time in establishments, it took a toll on their finances. That is, ideally, there is more free money – including due to the lack of the need to physically travel to work.

Part of the excess funds went to investments. And since the cryptocurrency industry began to grow sharply after the collapse in March 2020, people made a choice in favor of cryptocurrencies.

Despite strong market growth in the first half of 2021, not everyone approves of the digital asset link. In particular, the chairman of the Central Bank of Russia Elvira Nabiullina made it clear yesterday that she considers cryptocurrencies to be almost the most reliable way to lose your money.

However, traders disagree with this position. Therefore, they actively trade in coins – although they do it in accordance with certain characteristics.

When is the best time to trade crypto

A poll of 3,000 respondents from 87 countries , conducted in late March, showed that 56 percent of crypto traders began to take risks more often – that is, get involved with cryptocurrencies – after the introduction of full-scale quarantine in many regions of the world. Bitcoin remained the most popular investment option, while the popularity of Ethereum grew by almost 25 percent compared to the same data for the previous year.

Most likely, the reason for this was large-scale changes in the project. First, in July, with the help of the so-called EIP-1559, the principle of the formation of commissions in the network will change, which will make the use of the blockchain more intuitive. Secondly, Eth is waiting for the transition to version 2.0 of the network, which will increase its throughput hundreds of times.

Here is a comment by Overbit CEO Chie Liu on this issue, in which the expert shares his attitude to what is happening. The quote is from Bloomberg.

In the face of rising inflation and falling interest rates, investors are increasingly looking at assets like Bitcoin. Therefore, it is no surprise that traders’ risk appetite has increased significantly over the past year.

Recall that inflation or price increases arises, among other things, due to an increase in the volume of national currencies in circulation, which began to grow after the start of the pandemic. Nevertheless, they are artificially increasing, and this depreciates the assets already in circulation. In the case of some cryptocurrencies, whose maximum amount is limited in advance, this tactic simply does not work. This means that it is impossible to create bitcoins out of thin air in the right amount on the right day – hence the interest of investors in the crypt.

Both coins have more than doubled in value in the first quarter of this year, but most of those surveyed are confident that the market is still far from its global peak. By mid-April, many coins have broken their historical records, but to date, over the past couple of weeks, the crypt was almost the worst investment even in comparison with most traditional assets.

A striking example of what is happening is the story of Glauber Contessoto, who invested $ 250,000 in Dogecoin. At the peak of the DOGE rate, his investment was estimated at $ 2 million, but now the market has dropped significantly. As a result, the investor not only lost his status as a millionaire on paper, but also lost the equivalent of 638 thousand dollars over the past month. More information about its history can be found here.

Another interesting detail is that almost a third of respondents named digital assets as their first and only investment. This suggests that many beginners start their trader careers with Bitcoin, and only then their interest spreads to traditional markets. However, many of them in the end remain associated exclusively with digital coins.

By the way, even after the collapse of the cryptocurrency market in May, the weekend is most often a time period for the local growth of assets. This suggests that inexperienced traders «accelerate» the market with low liquidity, because, as mentioned above, professionals prefer to take a break for the weekend. And it also allows you to make certain adjustments to your trading activity. For example, think about the timely entry into stablecoins – that is, cryptocurrencies pegged to the dollar price, or the tightening of stop-losses, which will sell coins if they fall to a certain price level.

We believe that the differences in the behavior of traders with and without experience allow us to draw certain conclusions and at the same time assess their own activity. Most importantly, they make it possible to track changes in the market on weekdays and weekends. And this can help at least not to lose money on trading activity. However, sometimes the behavior of a niche does not fit into any framework.

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