Dollar-cost averaging
In short Dollar-cost averaging (DCA) means buying a fixed dollar amount of an asset at regular intervals, whatever the price, to spread out your entry timing.
Dollar-cost averaging, or DCA, means splitting a purchase into smaller buys of the same dollar amount at regular intervals. Instead of putting $2,600 into a token on one day, you might buy $100 every Friday for 26 weeks. The schedule is fixed in advance and ignores what the price is doing.
Because the dollar amount stays constant, you receive more tokens when the price is low and fewer when it is high. Your average cost per token ends up weighted toward the cheaper purchases, so it lands somewhere between the lowest and highest prices you paid. DCA can still end at a loss, and it does not always beat a lump-sum buy. In a steadily rising market, buying everything on day one usually comes out ahead, while in a falling market DCA loses less than a single early buy.
What DCA mainly reduces is timing risk: the chance that you put your whole stack in right before a local top. Crypto prices can swing 20% in a day, so this matters. A fixed schedule also takes emotion out of the process, which helps against buying a big green candle out of FOMO or freezing after a drop.
DCA assumes the asset survives. For a large, established token, buying through dips is a reasonable approach to entering a position. For a small-cap token, the price can fall 90% and never recover, and then each scheduled buy just adds money to a failing project. DCA also does nothing to protect you from a rug pull or a honeypot, so check the contract and liquidity before your first buy, not after your fifth.
Watch the costs. Every buy pays a gas fee or exchange fee, plus slippage on a DEX, and on an expensive chain a small recurring buy can lose several percent to fees each time. In a thin liquidity pool, repeated buys can also push the price against you. Decide your total budget, your interval, and the point where you stop before you start.