New Strategy on Trakx: Crypto DCA (Dollar-Cost Averaging)

Last update: 21/02/2025

We’re excited to announce the launch of a new automated crypto investing strategy: Dollar-Cost Averaging (DCA)! It will help crypto investors automate and simplify crypto investments, allowing you to automatically purchase digital assets on a recurring basis, decreasing risks, volatility, and stress.

Challenges of Crypto Investing

Our new automated strategy aims to solve most of the challenges crypto investors face, ensuring a smooth, easy, and stress-free experience for both new and experienced investors. Some of the most common challenges are:

Timing the market

The crypto market is known for its volatility and rapid price swings over short timeframes. It’s difficult to time the market and identify good entry points for your trades: a lot of investors choose the wrong timing to invest and allocate a large percentage of their funds at market’ peaks, reducing the profitability of their investments.

Stressful decisions

Psychological bias and uncontrolled emotions, such as fear and greed in crypto trading, can trigger FOMO (Fear of missing out) and result in poor investment decisions, such as allocating an excessive part of your funds, overexposure to individual cryptocurrencies, investing at market peaks, and more. It’s very challenging to manage your portfolio with peace of mind, without stress and FOMO.

Lack of consistency

The majority of crypto investors are not full-time traders; most invest as a side activity. Staying disciplined and consistent is challenging, and you should follow a well-defined plan. Automating investment is the key to being consistent and investing in a smart way, allowing you to become a more profitable crypto trader.

The Solution: Automating Crypto Investments with DCA

As we also explored in our previous crypto DCA (Dollar-Cost Averaging) guide, this strategy allows traders to invest a fixed amount of money regularly, regardless of the price of the asset, smoothing out the effects of volatility, and allowing you to accumulate assets without market timing stress. In detail, the benefits are:

Reduced volatility

By investing a fixed amount of money at regular intervals, you can reduce the effects of short- and medium-term volatility, aligning your average purchase cost with the long-term price trend of the asset. It means that, even if there are significant price swings in short timeframes, the average purchasing cost will be mitigated by making volatility less relevant.

Automated strategy

Your time is valuable, and implementing an automated DCA strategy will allow you to simplify your investing process, save time and effort, and enjoy the benefits of a strategic approach and well-defined plan. You no longer have to worry about how much to invest, make deposits, and choose the right timing: everything is done automatically for you according to predefined parameters.

Discipline and consistency

Being consistent over long periods is challenging and requires emotional control, time, effort, and discipline. By implementing DCA automatically, your investing process will be strategic, consistent, and clear, allowing you to implement a sophisticated strategy with ease, enjoying all the underlying benefits of DCA while having peace of mind.

How to Implement DCA with Trakx

We just released a new feature on our crypto-index trading platforms to implement crypto DCA automatically, allowing you to enjoy all the benefits of this strategy with ease. Let’s analyze the process with a detailed step-by-step guide!

Step 1: Sign up on Trakx

If you have not already done so, sign up on Trakx to take advantage of our crypto-index trading platform and automated DCA crypto strategy.

Step 2: Plan your investment strategy

In the second step, you should evaluate your risk tolerance, goals, budget, and timeframe, deciding the amount of money invested and the frequency. For example, you can decide to invest $12,000 in a 12-month period, resulting in a monthly investment of $1,000. Every investor should make decisions based on personal factors.

Step 3: Go to the “Auto-Invest” section

Now, go to the main menu at the top and select the “Auto-Invest” tab. Fill in the form choosing the CTIs in which you want to invest and their respective amounts.

Step 4: Submit the form

Review and double-check your selection carefully and read all the terms and conditions. After you have done that, submit the form. You’re now ready to implement DCA automatically!

Step 5: Make the wire transfer on the 1st day of each month

The final step involves making the wire transfer (every first day of each month) to activate your DCA strategy. Make sure to also insert the reference number provided in the email. If you want, you can do the wire transfer manually each month or completely automate the process.

Conditions

The conditions to implement our new DCA strategy automatically are the following:

• Minimum recurring transfer → 50 euros per month
• Monthly transfer only

Fees

Trakx has developed proprietary in-house scalable technology, allowing us to create new crypto indices and automatic strategies with ease and at a low cost. Our fee structure, in fact, is one of the most convenient and most affordable! While competitors usually implement fees that range from 2 to 4%, our fees always stay below 1%, ensuring competitiveness and increasing your profit margins, allowing you to make the most from your crypto investments. 

In detail, our fee structure for DCA are:

• < 250 euros → 1%
• 250 – 5,000 → 0.7%
• > 5,000 euros → 0.5%

An example of a very successful DCA strategy with Bitcoin!

One remarkable example of DCA strategy in crypto has been recently shared on Twitter. The post, shared by @BTC_Archive, featured a guy who invested $30 in Bitcoin daily for almost 8 years. Using this strategic and consistent approach, he turned $86,370 into $1,000,000, highlighting that consistency wins over the right timing. This guy can be considered a DCA legend!

We hope you will enjoy this new crypto DCA feature and all the benefits linked to it. As a last reminder, craft your strategy based on your personal factors (risk tolerance, goals, funds, etc.), and implement sound risk management practices to decrease the risks associated with cryptocurrencies. More interesting strategies and features will be available at Trakx in the coming months, so join us and stay tuned. Together, we are setting new standards for investments in digital assets.