I hope we are all doing okay? The current market and recent price actions have not given much hope but at least we are alive. Crypto assets saw major price volatility in the recent past weeks and experienced price corrections across board. According to Coinshares report, as a result of market turbulence, total assets under management (AuM) declined to $38 billion, a low point not seen since July, 2021, .
With increasing inflation, interest rate hikes, and the current Russian-Ukrain war, we cannot ignore the fact that things are looking pretty bleak at the moment. With the waning sentiment in the crypto market, which has been on a downward trend for months now, it is unsurprising to see Bitcoin and Ethereum trading at their current prices, $29k and $1.9k respectively.
Having said that, it is important we remain optimistic. The current drop in prices have been sharp unlike the last cycle where we had a long stretch of drops that bled assets to zero and many never recovered. Though it is likely to drop further, BTC is currently around -56% from ATH and sentiments already feel like it is approaching a (macro) bottom. While there is barely any volume at the moment, the market could pick up sooner than everyone expects.
In periods like this in the market, it is pertinent to remind us to think longterm. As @punk6529 recently put it: SURVIVE!
Survival here means making these four decisions: a) Should you be (continue) investing? b) How much are you investing? c) In what (projects) should you be investing? d) Are you in leverage? All of these are hugely personal, related to your view of the world, your financial situation and most of all, psychology. Think of it this way, if I can make it to 2050, will I do well in this space if it lives up to expectations and I follow the basics like seeking out quality assets and avoiding leverage? You find out that that once you have this perspective, market volatility won’t bother you as much. In fact, it means that these kinds of market actions present opportunities to DCA - Dollar Cost Average.
Once you understand the longterm investing perspective, DCA-ing into digital assets on market conditions like this make more sense. Besides the assets like Bitcoin and Ethereum, there are other opportunities in lower cap gems, many of which are currently trading -80% to -90% from their ATHs.
It is important to also note, in current market conditions, we psychologically seek ‘hopium’ from supposed ‘experts’ and traders. It is best to not treat any thing as gospel in current market climes as this will be regurgitating someone else’s bias. @Hsaka’s thread best captures this.
The point is, it is worth thinking twice before trusting the opinion of these ‘experts’. We should note market manipulation happens, and convincing retail investors to buy the top and sell the blood can be incredibly advantageous for VCs looking to exit their trades or buy assets for cheap.
Here at Kaicho Digital, we are poised to walking/running this race with you and hope to scream a joyous “we made it!” alongside you at the end of the line.
Think Longterm. DCA. S U R V I V E.