How To Survive The Crypto Winter

2 years ago · Updated 2 years ago

✍️ 17 October, 2022 - 12:17 👤 Editor: Jakub Motyka

Below are some tips for surviving 'crypto winter' ahead of the next rally.
Top on the list is patience and staying put with proper strategies.

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Certainly, 2022 remains one of the most challenging years for cryptocurrencies. Since the market peaked at over $3 trillion last year, there have been massive liquidations.

Currently, the crypto space has dipped to a valuation of $925 billion. It is one of the most significant liquidations in 13 years. Such a downturn have come to be known as 'crypto winter.' It is characterized by falling activities, high liquidations, and instances of project collapse.

So how can one pull through such a market? In addition, are there profits to be made? Here are some of the recommended tips.

Important Tips To Survive Crypto Winter

First, sticking around through the winter period cannot be emphasized enough. Analysts believe that projects with weak fundamentals often collapse during such times. When one hold on, they allow the crypto projects to develop better and regain their value.

Secondly, crypto winter is an opportunity for investors to strategize. Some of the approaches include the second-order thinking. It means studying more of what the others think than focusing only on the fundamentals.

The next tip is analyzing the probability of specific events occurring in the market. Based on the experts, one should assess the expected value of each of the investments that one makes.

Historically, cryptos peak roughly every four years. It usually comes amid an influx of new adopters. However, significant market crashes typically follow such events. In conclusion, surviving the crypto winter requires a long-term perspective on one's digital asset holdings.

The Ongoing Bear Market Is Attributable To Macroeconomic Factors

The current crypto bear market has been primarily due to macroeconomic aspects. A high inflation rate, for instance, has pushed investors away from riskier assets like cryptos.

In particular, top tokens are trading at a fraction of their former highs. BTC is 70% down from its ATH, while the second largest cryptocurrency, ether, has dipped 72% to $1,311. Moreover, experts hold the view that the market could go even lower.

Nonetheless, it is believed that there are opportunities in the ongoing bear market. From on-chain data, early adopters have remained resilient amid such strong volatilities. It is an attribute believed to have made them profitable over the years.

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Jared Kirui

EN: Jared Kirui is an experienced financial writer with a passion for all things blockchain technology. Previously, he was into stock markets and forex, providing asset managers with top-notch content. With a flair for producing high-quality articles, he started covering crypto news in 2021. He is open-minded, trades for fun, and enjoys sports.

ES: Jared Kirui es un escritor financiero experimentado apasionado por todo lo relacionado con la tecnología blockchain. Anteriormente, estuvo en los mercados bursátiles y forex, brindando a los administradores de activos contenido de primer nivel. Con un don para producir artículos de alta calidad, comenzó a cubrir noticias crypto en 2021. Tiene una mente abierta, comercia por diversión y disfruta de los deportes.