To Save or To Trade: Mitigating Loss In Bear Season
FUN FACT: 5 years ago today, BTC was $2,601 and ETH was $265. Today’s fall is a retrace, not a crash! The recent global economic recession has been detrimental to the cryptocurrency market. According to financial experts, we may be witnessing another crypto winter similar to that of 2018–2020. As strong believers in blockchain technology and a decentralised economy, it is important to assess this long-enduring bear season thoroughly and mitigate the impact. Perhaps more than any other investment, cryptocurrency investing is influenced by market movement and the crypto market is highly responsive to emotional traders. As a result of investors’ being alarmed by the present geopolitical situation, the sentiment toward cryptocurrencies is currently strongly skewed in the direction of extreme fear, according to the Crypto Fear & Greed Index. We have compiled a few points that can help crypto investors and traders survive this possible crypto winter. First, What is a Bear Season? A bear market is a term used to describe a sharp decline in the market’s value over a short period. What is Crypto Winter? A bearish market that persists for many months with continuous price drops of all assets is referred to as a “crypto winter.” It is usually characterised by alarming reactions of investors and negative sentiment in the media and the market as a whole. 5 ways to survive the crypto winter 1. Stay calm and rational: Everyone understands how the impermanent loss of a crypto dip can be damaging to the portfolio and reduce the confidence of an investor. Therefore, it is highly important to stay calm, take deep breaths, and maybe even take breaks from your crypto assets and relax with other activities. In a bear season, traders’ strength is tested and investors’ faith is tried. An expert trader/investor must survive at least one major crypto dip to learn the game of patience. 2. Assess your portfolio and weigh your options: To sell or to hodl? Do not panic sell all your assets at a loss. Some crypto assets are worth waiting for, especially layer 1 cryptocurrency with a solid technology use case and Dapp development. Thus, it is more advisable to wait out the season while you Hodl. This is not the time to jump into buying the dip. You should reassess the strength of your portfolio with a strong technical analysis of each asset. If you do not have assets with a strong use case that you can hodl, you may consider buying the dip with disposable income. 3. Consider saving/staking/yield farming with your good coins When you have prioritised your portfolio and decided to hodl your coins, you should make the best out of them by staking or saving in low-risk flexible investments.
🚀Saving: Crypto Savings is an opportunity to earn interest on assets left untraded. This is available on centralised and decentralised platforms. On VIBRA, you can earn daily income from your assets when you save in USDT, BTC, ETH and BNB. VIBRA Savings is a new feature that gives investors the chance to receive daily interest for locking up their crypto assets on the wallet app. This can help investors reduce their losses during a market downturn like the one we are currently experiencing.
🚀Staking: Crypto staking locks up cryptocurrency holdings to generate rewards or interest. Cryptocurrencies use blockchain technology to verify and store digital transactions. Staking validates blockchain transactions.
🚀Yield Farming: Another tactic for an experienced investor in digital assets (ONLY an experienced investor) could be yield farming. The process of moving money within the decentralized finance (Defi) ecosystem in exchange for steadily increasing rewards is known as yield farming, also known as liquidity mining. In times of market stress, this might be useful, but it’s difficult, expensive, and risky, so caution is advised.
4. Buy the dip. When you want to buy the dip in a crypto winter, it is like catching a falling knife. It is important to get an updated market analysis before diving in. Trying to determine the bottom of a price fall can be very tricky, and you may wait in vain and lose your entry point. To minimize the impact of volatility on asset purchases, dollar-cost averaging (DCA) method is advised
🚀What is Dollar-Cost Averaging?
DCA entails a series of periodic purchases of the asset in segmented fiat amounts. Investing via dollar-cost averaging is a tried-and-true method. According to DCA, the investor splits the whole investment sum and buys the desired asset in bits over time, taking into consideration the volatility of the market and price swings. By doing so, an investor can lessen the effects of volatility and do away with the necessity to determine the ideal entry point or bottom. 5. Collect the raindrops. While you wait for the market to regain its momentum, gather some raindrops or freebies in the crypto space. The bear season is estimated to offer more promotions, knowledge sharing, and rewards from major crypto trading platforms. Join genuine communities to gain insight, learn and bond within a crypto support group and you might just be lucky enough to get some free crypto coins too. Conclusion The dip is not strange to the crypto space and this year will see some bull action again. Whether sooner or later, the crypto winter is not forever. The green season will surely emerge, while we are waiting, join our crypto community on Telegram and Vibra Social in-app for more insights and knowledge.
Buy your good coins on VIBRA, Save and Earn VIBRA is your easiest and most rewarding crypto wallet app for Africans and VIBRA SAVINGS is a new feature for our users to get additional rewards. You can earn daily income when you save your crypto assets on VIBRA. How To Save and Earn on VIBRA
Simply download VIBRA App
Fund your account with any of these cryptocurrencies (USDT, ETH, BNB, BTC). You can buy USDT from verified P2P merchants and pay from your bank account.
After funding your VIBRA wallet, navigate to the SAVINGS tab
Choose your favourite cryptocurrency and begin your savings plan.
Please read the terms and conditions before you begin your savings