Crypto investors and traders got off on the right foot and even went miles to make this year all about crypto, NFTs, and metaverses. Yet, here we are, thrown into what appears to be a crypto winter, and trapped in a whirlpool of the crypto bear market.
Considering the recent events, you must have been speculating on your crypto assets now and then, while gawking helplessly at your portfolio being painted red.
Well, don’t surrender yourself to the crypto bear market, this will only expand the losses and associated risk factors. It’s time to reanalyze your investing tactics and brush up on your foundation concepts to stay safe during the bear market.
We have wrapped up some tips that can be your resourceful ally when the crypto market is in such a tight spot. Let’s begin!
- Secure your Portfolio and HODL
Having a clear idea about your crypto investments and making level-headed decisions during a bear run is what will take you a long way.
Given the volatility of the crypto space, you first have to secure the cryptocurrency that’s in your wallet. To HODL means securely keeping your Bitcoin, Ethereum, or other prominent cryptocurrencies rather than selling them during the crypto bear market.
At the same time, you should also make sure that the crypto you are holding onto is not sourced from the “pump and dump” schemes. Though it is difficult to predict which cryptocurrency will bounce back or which one will go down the drain, you must keep an eye on trends and news. However, do your own research and take your time to come to a conclusion instead of panic selling.
- Develop Skills
Regardless of crypto bear market swings, you should keep on learning new strategies to survive ‘the bear’. To tell you the truth, a bear market is the best time to increase your crypto knowledge without the buying pressure.
Usually, everyone is in a cut-throat competition to keep an upper hand with an intention of making maximum profits. Hence, you should gain valuable new insights by getting your head around the crypto and blockchain concepts.
Learn to read smart contract data, analyze trading patterns, and above all, you can get some strong crypto added to your portfolio for a small amount. This brings on to our next point, consider improving investing formulas and learn from your mistakes during the crypto bear market.
- Don’t go against the Crypto Market
It’s better to improve your investing formula and learn from not only yours’ but others’ mistakes as well. A crypto crash often tempts people to try trading the market via margin trading or shorting. However, if you still can’t calm your appetite for trading, then you can employ these tried-and-tested trading techniques during a crypto crash.
When all is said and done, change your mindset of not taking a loss. Take losses and wait for a temporary pump to buy more once the previous low gets settled.
Particularly when we are dealing with the crypto bear market, you should first focus on survival. Attempting to back your money through margin trading is stupid. Don’t try to treat this market by pulling crazy plays. The least you can do is: stay in the market, generate a new stream of income for the bullish season, and hope for the best.
- Dollar-Cost Averaging (DCA) will come to the Rescue
Investing in a project based on what the so-called crypto community hyped up is a bad idea at any time, not just while suffering in the crypto bear market. In case you have already decided to get involved with a given crypto project, using DCA is the best way to minimize the risks involved.
Adopting a proactive approach as you implement your master plan makes sure the control stays in your hands. To do that, opting for DCA can enable you to safely distribute your budget across a yearly cycle and beat FOMO while waiting for other opportunities across the crypto bear market.
- Don’t wait for ATH (All Time High)
Diversifying your portfolio to dodge post-crypto crash effects is a good move, but sometimes buying crypto at low prices doesn’t translate to profit.
Developers often leave projects during the crypto bear market, and abandoned assets aren’t adequately updated in real-time, making the cryptocurrency unstable and vulnerable. It’s fair to say, some crypto will never actually reach an all-time high (ATH).
Keep in mind that not all low prices are bargains, and some cryptocurrencies are sold at low costs for a purpose! Anyone who tells you otherwise is likely attempting to deceive you into committing a crypto gaffe.
- A big No to Overestimating the Crypto Market
Don’t assume every cryptocurrency you have invested in or plan to invest in will come back. Some cryptos die permanently. There could be many factors contributing to such losses including running out of funds, pump and dump scams, or even disappearing developers or teams.
The crypto bear market induces fear and anxiety in investors and traders, irrespective of whether you are an amateur or an expert crypto player. So, focus on investing in something of genuine value that has some authenticity and reputation in the crypto market.
Also, in panic and stress of losing all your money, don’t rush into making an impulse decision. You never know you might get a nice surprise in a couple of years. Trust your gut feeling, don’t overestimate, and wait patiently.
Also Read: Are We In a Crypto Bear Market?
- Comparing with the Past is an Utter Waste
The crypto space is expanding rapidly, but when you compare it with the past, you would mostly come across scams and white papers. Back then, most people in the crypto industry were amateurs and volume was much lower from what it is in 2022.
The protocols are more mature now. Undoubtedly, we have protocols with huge cash flows backed by venture capitalists and wide user bases. So, all those saying it’s all going to zero are wrong.
The crypto bear market is just a passing phase but also a time to reflect and write your own rules and principles to plan for the crypto spring. On the other hand, fearing crypto winter is utterly useless, given the crypto market tends to show dramatic swings.
- Build Extra Income Stream
If you are a newbie experiencing your first crypto bear market cycle, then it’s all the more difficult for you to stay calm in such a rough patch financially. Well, you are not alone in this.
Nobody tells you directly to have passive income while dealing with crypto. No matter how much some crypto enthusiast denies it, having an extra income stream is not a bad idea.
The aim is not only to have some money on hand but also to stay strong even during the crypto crash and even worse, crypto winter. When the mainstream income suffers consistently for a longer period of time, it can put the person in severe misery which leads to bad financial decisions.
It’s better to analyze where you stand, how much money you can afford to lose, and prepare yourself for the better days that definitely await ahead.
- Stick to your Strategy
Amid the crypto bear market, a lack of proper risk management can turn any winning trade into a losing trade really fast. This is why having a proper trading strategy can help you avoid making emotional decisions. It is hence suggested that you stick to your own well-researched strategy.
You can also mitigate risks and keep your emotions in check by simply pre-deciding take-profit (TP) and stop-loss (SL) orders. Consequently, it would be easier for you to lower the stress throughout the crypto bear market and prevent you from making emotionally influenced decisions.
- Invest in Yourself
Crypto players know how much they sacrifice to ace the game of trading and investing. During this crypto bear market, you probably should build and invest in your non-crypto friendships to keep yourself connected to your roots.
Invest in your physical and mental health, take it as the recovering phase to help you push the odds in times to come. Also, some things are more important than money such as family, friends, health, and relationships. Let loose the crypto bear from the mind and use this time to strengthen your personal growth areas.
