After spending 30+ hours listening to podcasts and reading interviews of people who experienced the previous bear cycle. I learned a few things and I am going to share them with you.
They talked about a lot of things, but I am going to summarize it for you with action points. By taking their most common experiences to explain how a newbie can survive this bear market and turn it around to make generational wealth.
During a bear market is when you research, build and develop yourself to make generational wealth.
I know you must have heard this phrase countless times “bear market I when you build.” or “buy the dip.”
It hits different this time.
Here is how.
During the bull cycle, It is easy for projects to create whitepapers, pay community managers, and hire marketers and influencers to promote their projects while their projects have no use cases and still sell out their ICO.
There is so much optimism during the bull market that, people are more interested in making 20x than the use case of a project. And to make 20x you have to be among the first few people to buy a coin early.
So projects capitalize on the market condition to launch cash-grab projects.
That is why when the bear market sets in, some projects that didn’t want to “scam exit” after they’ve gotten what they wanted, will gradually die a natural death.
We saw the ICO rush in 2017. Projects were just copying whitepapers, rebranding, and launching as a new projects.
Nevertheless, during a bear market, the noise stops.
New projects have to be more sophisticated enough to convince retail investors, venture capitalist, and angel investors to buy their ICO because everyone is pessimistic.
They have to state clearly what it is they are building, how they will build it, and how the end product will improve crypto adoption or whatever their goals are.
Old projects have to innovate, else new projects have to take their glory.
$NEO, $EOS, Dragonchain, Wanchain, etc all wanted to do what $SOL is doing.
However, they didn’t innovate or maybe, just maybe………..
Enough of the bear-bull story.
Let’s get down to business.
How to survive the bear market.
If you are among those who couldn’t take a profit during the bull market, and right now you are losing a part of your capital.
I advise you not to sell.
You are at loss. And although some coins may never reach all-time high again, they “may” make some bullish moves during the bull cycle.
This depends on if you can wait for it. And that leads me to this point. You have to know your risk tolerance level before investing in crypto.
Some people invest in crypto and can’t close their two eyes while sleeping. You have invested more than you can risk. You should work on that.
Risk tolerance is a whole post on its own. I won’t go into details on it here.
How to make generational wealth in crypto.
With the current market situation, crypto and Web3 are going to be sidelined a bit in the mainstream.
A lot of people are in despair and even depressed. People’s life savings are gone.
However, just like every other business and industry, those who build and buy when everyone is afraid to invest make the most of the money.
Crypto is definitely going to bounce back. We don’t know when, but the question is, what side of the coin would you be on?
1. The exit strategy of people who bought the dip or
2. Would you be among those who would sell to new investors?
The bear market is the time for you to take your time to research projects and invest in the ones that meet your criteria for a good project, most importantly, projects that solve a problem in the crypto space.
For instance, L2 and sidechains projects were a solution that everyone has been seeking. All L2 projects did well during this bull market.
These are the kind of solutions you should be considering when making your research on crypto projects to invest in.
Your research shouldn’t be limited to L2s. What matters most is that you should enter a project with a real solution early.
During your research, check the history of the team members and what they have done.
I spend up to 4–5 days researching a project to get an informed decision on whether to invest in a coin or not.
Yours could be shorter or longer. The most important thing is that you should be able to write or say in a sentence if you want to invest in a project or not.
Recap: how to make generational wealth in crypto.
- Make your research and pick alpha projects.
- Research about their team members’ history, tokenomics, partnerships, etc.
- Are they funded?
- You can add more to the list.
However, someone who doesn’t have a steady source of income cannot comfortably invest in crypto.
What happens when you have to pay bills tomorrow and your crypto investments are at loss?
You would sell at loss to pay your bills, right?
That is why you need a steady income to handle your bills and the remaining goes to crypto investment.
Crypto is a long-term game. Allow the market to do its thing. It will eventually come to you and it will amaze you.
Buy good projects early and wait. That’s how you make generational wealth in crypto. As simple as this sounds many people do not do this.
Those who bought Bitcoin for around $4,000 and $6,000 in 2020 are still in profit to date.
#Learn. #Buidl. #Develop.
Quincy Ememandu is a Content Writer. I write Web3, DeFi, and NFT content for marketing agencies and crypto projects. I also ghostwrite Twitter threads and Linkedin posts for businesses and individuals.