There is one thing we cannot deny about crypto, and that is its extreme volatility.
But perspective is key.
The situation is a little like the guy explains down below.
Doomsday predictions were rampant in every one of the previous corrections.
The gut-wrenching price swings are a lot for anyone to handle, which is why it’s so important to adhere to the following:
- Buy at The Support Level: Right now, you can buy the solid cryptos at or near support levels, which means they won’t fall much more from here. That way, the unpredictable volatility won’t cause you to panic sell.
- Avoid Frenzies: Don’t be a follower. Everyone wants to buy when the market is on fire. Resist this urge with crypto, much like you would with a regular stock.
- Maintain Perspective: As I have demonstrated above, some of the world’s most revolutionary technology suffered setbacks and crashes before an unprecedented amount of growth in the future.
- Macro Outlook: Bitcoin is far from perfect, and it’s ok to admit that – no new technology ever was. This did not stop the internet or the automobile and will not stop crypto either. Blockchains and cryptos will continue to innovate and pave the way to a decentralized financial future.
- Purchase Incrementally: If your goal is to invest $1,000, purchase $100 worth of coins this paycheck then $100 more the next paycheck, and so on until you reach your desired amount. Don’t go all in – this is a rookie mistake.
Remember, cycles are part of the nature of a market.
If we apply the Wall ST. Cheat Sheet to the crypto market, it would be in the anger or depression stage right now.
This cycle has repeated itself over and over in the history of the stock market.
Most people only invest when there is mass euphoria in the market, instead of making wise investment decisions during times of uncertainty.
Your road to financial freedom is simple, but not easy.
You will need the patience to wait out the rest of the bear market and tenacity to handle the ups and downs when it begins to trend upward.
When someone on Quora or Youtube says crypto is a scam, they are partially right.
Because most cryptocurrencies are indeed shit coins.
And yet, crypto is the future.
Do not take my word for it. Do your own research. And keep the following in mind.
When the automobile was invented, the majority did not believe the heavy, noisy, slow and break-down prone machines would ever replace the horse-drawn carriage.
It took years for the pioneers of revolutionary technologies to build the future which now includes fast and safe transportation, as well as immediate access to knowledge and resources that were only available to a microscopic portion of the world population before.
This was accomplished step by step. The internet has gone through hundreds if not thousands of upgrades, and so has the automobile.
Steve Wozniak, co-founder of Apple and builder of the first Apple computer recently commented on blockchain:
“It takes me back to the early days of personal computers, where businesses didn’t think it’s going to be worth anything. And a bunch of us thought, ‘Oh my gosh it will be a different world if we all have computers.’ And it was such an exciting time.”
“Every single blockchain application I hear about, whether it’s manufacturing or materials sources or the history of real estate or voting – every application I hear about is ‘Woah, this is so intriguing. Will it actually work?’
And eventually it boils out to which ones do work, and we need one bowling pin after another. And it may take a while to start it because people can’t change their ways easily to things they don’t understand fully inside.”
It takes vision, tenacity, and perseverance to change the world.
As Tim Ferris says, you’re better off doing the opposite of what everyone else does.
If you want to win in this market, you will need to buy when everyone is selling and sell when everyone is buying. And you must also choose your coins wisely, or you will lose.
Steve Wozniak actually sold all his Bitcoin at the peak of the market. He still believes in the technology – just understands how a market cycle works and doesn’t follow the crowd.
Let me tell you about a book I read when I was a youngster.
It was called The Millionaire in the Mirror.
The premise of the book was straightforward.
These are the rules.
Rule #1: You should avoid catastrophic failures.
We all have setbacks – they are part of life. You cannot be afraid of failure if you want to succeed.
Don’t get into massive debt, don’t get addicted to crack, don’t commit a felony, etc.
Rule #2: Roll the dice when the dice are loaded.
You might feel stagnant at times.
But if you stay in the game long enough and avoid catastrophic failure, you will eventually come across a loaded set of dice.
What this means is various circumstances will align so your risk is reduced but the upside is tremendous.
You may be asking, but how does any of this apply to cryptocurrency?
Your loaded dice scenario could be setting up right now in the global economy and crypto market.
Let’s start with U.S. fiat currency
It can be printed at will by the federal reserve, watering down the value of your savings through inflation at a supposed 2% per year – many would say it is much higher.
The increased money supply will end up in the banking system one way or another, which allows banks to increase their lending.
They can lend up to 10 times the value of their ‘reserves,’ otherwise known as our checking and savings accounts.
Did you know your deposits are a loan to the bank? You are, indeed, lending the bank your money with an annual interest rate of about .01 %.
They can then lend out ten times that amount at 24.99% APR.
Here’s some more data.
Inflation has risen more than 500% in the last 50 years (in the U.S.), while median income has only risen 100% during the same time period.
|From Ludvig’s Common Place|
|1930: Average Wage = $27.481||2012: Average Wage = $44.321|
|1930: Average Home Cost = $53.365||2013: Average Home Cost: $289.500|
|1930: Average Car Cost: $8369||2013: Average Car Cost: $31.35|
The dollar is losing its value.
The stock market has reached its peak.
Meanwhile, solid cryptos have more than likely reached their bottom.
Yet, we continue to make incredible strides in technology.
The internet will play an ever-increasing role in our lives as we keep moving forward.
We learn online, communicate online, network online, shop online, work online, date online, etc.
Do you think money will be exempt from this trend?
Facebook doesn’t seem to think so.
I just came across an article titled Facebook developing crypto for WhatsApp transfers.
We have an economy stacking itself in favor of alternative stores of value and other forms of currency as we head further into the internet age.
Nouriel “Dr. Doom” Roubini, who previously predicted the financial crisis of 2008, recently said in a Senate hearing that 99% of cryptocurrencies are worth zero (shouts out to the Uneducated Economist, who put me on to Roubini’s testimony).
But even If 99% of them are going to zero, that leaves us with about 20 cryptos that could do extremely well.
You can view a list of all cyptos here.
All the world’s greatest disruptors were criticized when they first came on the scene. There’s even a Newsweek article in 1995 called “The Internet? Bah!” Whenever something brand new is invented, people are slow to shift their mindsets and envision a future that is entirely changed. Perhaps it’s a lack of creativity; a lack of an ability to see the future different from
what we know now. Perhaps it’s a desire to see other people fail; to watch big businesses collapse or all the above.
We are currently in the trough of the crypto market.
The next uptrend could start tomorrow or three years from now.
But it will happen.
FOMO, or fear of missing out, is what drove the last bull run in the crypto market.
Future bullruns, however, will be accompanied by real traction, implementation, and adoption.
There is also the possibility of institutional money entering crypto. This is already in the works with BAKKT and Stuttgarter Börse.
If you are willing to see past the Bitcoin slump of today and realize that right now is the perfect time to get in the game, then you can have your very own slice of the technology of our future.
Make sure to stick around for part three. I’ll provide insights on some top-notch, underhyped and underpriced cryptos.
In the meantime, checkout out the links below!
Recommendations by Londonletter.org
The Internet of Money, Volumes 1 and 2 by Andreas M. Antonopoulos.