The profitability of holding or trading cryptocurrencies is determined by the trader's objective, strategy, and skill set. Furthermore, both approaches have advantages and disadvantages that market participants must weigh carefully before adopting them.

Investing does not carry the same level of risk as trading, but some may argue that the reward is not as high. At least not if the trader is extremely successful.

Most days of the week, experienced traders can earn several percent returns on investment (ROI), while investors will see an increase in the value of their overall portfolio (if the market goes up).

A trader, on the other hand, can profit when the market falls if they are skilled enough to time the market correctly. Trading also includes the option to use leverage, which allows traders to multiply profits with little capital. Leverage, on the other hand, can result in larger losses if the market moves against the trader, increasing the risk.

However, long-term crypto holding provides investors with certain benefits that earn them additional rewards. They can, for example, obtain access to airdrops and use their tokens for staking or yield farming.

Before deciding on the best method for them, traders and investors must consider these factors as well as their various risk management strategies.