If you're patient enough, it's feasible to set and forget your investment in Bitcoin (BTC 0.87%), though it's probably a better idea to pay attention to it from time to time than it is to fully zone out.

There's quite a lot going on with this coin at the moment, between new government policies, deepening integrations with the traditional financial sector, geopolitical intrigue, and the continuing global adoption of cryptocurrencies in general. That means investors are exposed to opportunities for profit, as well as to pitfalls -- and panic-selling isn't the only pitfall to be concerned about here. There's one mistake in particular that's especially appealing to make these days, so let's examine it and make sure you aren't at risk.

Speculation is swirling right now

Fear of missing out (FOMO) is a powerful motivation for investors, especially in cryptocurrency. When you see an asset's price rise day over day, or even hour over hour, it's enormously tempting to smash a big wad of your cash into a new investment so that you capture the upside of the move rather than being left behind.

Short-term and highly emotional thinking like that is usually a mistake. With Bitcoin, buying on a whim is an understandable mistake to make, as a handful of significant catalysts are playing out, and more could be on the way.

The U.S. government is, at least for the moment, pursuing the formation of a Strategic Bitcoin Reserve (SBR), and, per the president, the country will be oriented toward holding its coins rather than selling them, though that could easily change in the future. As the details of how the SBR will be implemented trickle out, assuming it is ever actually created, the coin's price may rise. More importantly, other countries may opt to follow the same path, forming repositories of the coin that they intend to retain indefinitely. It's easy for investors to jump at speculation on that front and buy a lot of Bitcoin, even if they're ultimately proven to be false or ungrounded.

Another tantalizing trend is tokenizing, tracking, and trading real-world assets (RWA) on Bitcoin's chain. That's doubtlessly exciting because it means it's possible to create records of ownership that will live on the blockchain. But it isn't an urgent reason to buy the coin.

Haste makes waste

There is simply no rush for any investor to accumulate Bitcoin, even given that it's a high-quality asset that's worth buying and holding a lot of. There is no new policy, new buyer, new feature, or other new thing that demands your dollars to be invested before or within any specific period. Committing too much of your capital in a lump-sum investment might leave you underwater for years if the price declines.

In fact, the coin's core supply dynamics, wherein it becomes scarcer and more difficult to mine over the long term, only suggest that it's better to buy the coin sooner rather than later in the grand scheme of things, not that you need to buy it soon to capture some kind of rapidly eroding upside. Nor do Bitcoin's supply dynamics guarantee that its price will actually go up at all over any period, especially not over the short term. The upside is the greatest for those who invest and hold it for the longest, not for those who took on the biggest amount of financial risk at the moment of their purchase.

So, don't over-commit. Don't be cajoled by investing more than you'd normally be comfortable with to chase the returns supposedly offered by the coin's many new happenings over the next few months. Resolve to allocate up to 5% of your portfolio's total value to buying it, and then dollar-cost average (DCA) your funds slowly but surely until your position reaches your target size. Don't be afraid to rebalance your position by selling some of your coins if you end up taking on more risk than you initially intended.

The DCA strategy isn't going to give you an emotional rush like buying a lot of Bitcoin all in one day will do. Nor will it give you the same upside as if you happened to time the market correctly, which isn't possible to do reliably anyway.

What it gets you is a much higher probability of winning the long game, when the coin's supply will become more and more constrained, and when late buyers will be realizing its upward trajectory over the long term and over-investing in an ill-advised attempt to catch up. At that point, you'll likely be sitting pretty, so don't worry too much about whether you buy Bitcoin today or a few months from now.