Bitcoin has been an attractive investment opportunity for years, but its high volatility means that it is also fraught with uncertainty. However, this volatility can be smoothed out somewhat through regular, automated purchases using a savings plan and, in addition, emotions tend to be ignored when investing.
Let's start by looking at the many advantages of a Bitcoin savings plan compared to individual Bitcoin purchases, which are usually made at irregular intervals and in varying amounts.
Bitcoin is characterised by its price volatility. A savings plan allows investors to use these fluctuations to their advantage by regularly investing a fixed amount in euros. This approach leads to an average entry price over time, which reduces the risk of investing at the wrong time.
Despite its volatility, Bitcoin has shown impressive growth potential. With a Bitcoin savings plan, you can gradually invest in this potential without having to track the market on a daily basis. This long-term approach has proven effective in capitalising on Bitcoin's appreciation.
A structured, automated savings plan reduces the risk of emotional decisions that can be triggered by sudden market fluctuations. By buying regularly, regardless of the current price, you follow a disciplined investment strategy and protect your portfolio from impulsive actions.
Another advantage of Bitcoin savings plans is the automation of the investment process. Once set up, your purchases are made regularly without any additional effort. This not only saves time, but also allows you to focus on other investments, while your Bitcoin portfolio grows steadily.
Whether for small or large amounts, a Bitcoin savings plan is flexible and can be adapted to your financial situation. Splitting a larger sum into regular, smaller investments reduces the risk and optimises your long-term investment result.
In this example, we consider the past two years, i.e. the period from 1 March 2022 to 29 February 2024.
On 1 March 2022, we set up a weekly savings plan at € 21 per week. The BTC portfolio from this savings plan shows the following results as per 29.02.2024:
Total investment in Euro: 2.205,-
Portfolio value in Euro as per 29.02.2024: 5.074,54
Yield: 130,14 %
Profit in Euro: 2.869,54
As a relatively simple example, we have made 4 individual purchases between 1 March 2022 and 29 February 2024, at intervals of 6 months. As with the savings plan, the total investment amounts to € 2,205.
1. purchase on 01.03.2022 at € 551.25 (price at €43,189 = 0.012767 BTC)
2. purchase on 01.09.2022 at € 551.25 (price at € 20,048 = 0.027496 BTC)
3. purchase on 01.03.2023 at € 551.25 (price at € 23,144 = 0.023881 BTC)
4. purchase on 01.09.2023 at € 551.25 (price at € 25,932 = 0.021256 BTC)
Total investment in Euro: 2.205
Portfolio value in Euro as per 29.02.2024: 4.920,32
Yield: 123,14 %
Profit in Euro: 2.715,32
Please note that the buying behaviour of Bitcoin investments varies greatly from person to person and that such individual purchases are very different. This scenario is intended to provide an easy-to-understand comparison without representing the standard case.
As the practical example shows, the return over the same period when investing using a Bitcoin savings plan is 7% higher than when investing through individual purchases. Apart from this, the regular savings plan purchases were made automatically from the time they were set up, while the individual purchases took a certain amount of time and effort each time.
Setting up a savings plan can therefore be an effective and above all stress-free strategy to benefit from the long-term increase in the value of Bitcoin while minimising risk. By utilising dollar-cost averaging, you can use the volatility of the market to your advantage, reduce emotional decisions and take a disciplined approach to building your Bitcoin portfolio.
Got a taste for DCA? Then simply set up a savings plan with Coinfinity now - we'll explain how below.
1. Open the Coinfinity App and log in or register and verify yourself, if you do not yet have an account, then tap on the orange + plus button in the user dashboard and select "Savings plan".
2. A new screen will then open in which you can specify the desired savings plan amount and the time interval. You must also enter your Bitcoin receiving address (public key) at this point (it is best to do this using the "Copy and paste" function to avoid typing errors).
Then tap on "Continue" to go to the order overview.
3. Now please check your details and your Bitcoin address again carefully. Your individual fees per transaction are displayed transparently at the top. Then confirm the GTC and the information on the right of cancellation and tap on "Create a savings plan".
4. Your savings plan order has now been received. Please set up a standing order with your bank using our bank details and according to your desired details (amount and time interval). Please use the specified payment reference (intended use) so that your transfers can be allocated to this savings plan.
5. Congratulations! You have just successfully set up a Bitcoin savings plan with Coinfinity and will now automatically receive Bitcoin in the desired Euro value on your Bitcoin wallet as soon as a payment from your standing order is received by Coinfinity.
Tip: Your savings plan with Coinfinity is flexible - this means that you can adjust the savings amount and the interval of your standing order at any time as you wish. As long as you use the intended use associated with the savings plan, these changes are automatically taken into account. You can find more information in the following FAQ.
The Bitcoin savings plan is free of charge. Only the usual service fee and mining fee apply.
That depends on the interval of your standing order. As soon as a EUR amount with your savings plan payment reference has been credited to our account, this amount is converted directly into Bitcoin and sent to the BTC address provided by you.
No, savings plans with Coinfinity are very flexible. You can change the amount and the interval at any time. Simply adjust your standing order. Please note that all transfers you send for your savings plan have the respective payment reference of your savings plan.
Yes, the Bitcoin savings plan can be canceled at any time by simply canceling the standing order with your bank. No further notice to us is required. If you want to continue your savings plan, you can simply transfer again using the payment reference of your savings plan.
Yes, you can create as many different savings plans as you like. When creating your standing orders, please note that each savings plan has its own payment reference.
Get the Coinfinity app now and set up a Bitcoin savings plan in just a few minutes!
Investing harbours risks. Any financial investment can result in the loss of the capital invested. This article does not constitute investment advice or an invitation to buy Bitcoin. You should always carry out your own research before making a purchase. Past performance is no indication of future performance.
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