Holding Crypto as an Investment vs Spending It: Why the Mindset Is Different

Two use cases, two mindsets

Holding a cryptocurrency for its long-term potential value and spending a cryptocurrency for everyday purchases are different use cases that can call for different assets within the same wallet. A volatile asset like bitcoin is commonly held with the expectation that its value may change significantly over time. A stablecoin balance is generally better suited to near-term spending specifically because it is designed not to have that same price movement.

The cost of spending a volatile holding

Mixing the two mindsets — spending down a volatile holding as if it were a stable balance — means a purchase's real cost, in terms of what was given up, can vary a lot depending on the asset's price at the moment of spending. If you spend bitcoin when its value is low, you may later regret not holding it. If you spend when its value is high, you may feel you got a good deal, but the mental calculation is always there.

Stablecoins for predictable spending

A stablecoin balance is designed to maintain a stable value by being pegged to another asset, most commonly the US dollar. This makes it suited to near-term spending: you know roughly what your balance is worth from one day to the next. Wallets like Nexus Pay let you hold both stablecoins for spending and other cryptocurrencies for holding, so you can separate the two.

Choosing what to spend and what to hold

Many users keep a stablecoin balance for everyday purchases and card spending, while holding other cryptocurrencies separately as long-term positions. This approach avoids the regret of spending an asset that later increases in value. Other wallets may only support one asset type or not offer a card for spending, limiting this flexibility.

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