How to make the most of the bear market

The cryptocurrency markets are falling. A lot.

The market capitalization of the entire cryptocurrency complex is down 83% from the historical highs. There is also a large dose of pessimism and general negativity that is launched.

The Lambo and Moon memes are over and in their place there is a strange mixture of indignation, courage, humor and resignation.

So, what is a cryptocurrency investor and adherent to doing? How can you still make rational decisions and help the development of cryptocurrency space?

In this post, I will examine the most effective methods to exploit the bear market and contribute to the wider cryptocurrency ecosystem.

Stop the FUD

Yes I know.

There are some very real concerns that people might have with the cryptocurrency complex at the moment. People who express their concerns about the status of adoption, infighting and regulation raise legitimate concerns. We can not reject all criticism of cryptocurrencies as someone who is simply spreading FUD.

However, just as if it were something pornographic, you will know FUD when you see him.

News articles on financial sites that proclaim "Bitcoin is Dead". Reddit posts claiming that Bitcoin will reset itself without any data or supporting information. Sensational statements that try to emit an illicit reaction.

In many cases, they get exactly what they are looking for. They will get clicks from their titles of salacious articles. They will get the lucrative Karma from all the other users who have upvoted their pseudo masochistic meme.

Do not let fears cloud your judgment or your thoughts. Take a careful and deliberate position when reading negative news about the prospect of the crypt. Get it all with a pinch of salt because there is really some salt around.

Change your investment thesis

Since the markets have changed so dramatically in the last few months, you must also change your investment thesis. You can not simply rely on institutional adoption voices from artists like Bakkt, Fidelity, Goldman and any other Wall Street swelling bank.

It will not happen soon.

Moreover, this should not be the point. Let us not forget that the reason why Bitcoin was developed for the first time is because Satoshi wanted to free us from the restrictions of centralized finance and fractional reserve.

Your investment thesis should be based primarily on the promise of technology.

Which projects are pushing more code? Which ecosystems have the most enthusiastic communities? Which coins are used actively and are solving the problems of the real world?

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By asking these questions, you are facing the question of value. You are basing your investment thesis on those coins that are likely to offer more to the world than a meteoric price increase.

Change your horizon

The main problem that cryptocurrency "investors" had when they were entering space is that they were doing it for the wrong reasons. They were looking for a simple scheme of quick enrichment.

For a while, it really worked. Traders would buy some low capitalization dark currencies and watch their stake increase by 10-100 times the initial investment. However, it was clearly unsustainable as the coins that gathered were also the fastest.

Short-term wealth should not be your goal. You should invest in a long-term horizon. Sometimes the value takes time to make its way into the price. The coins that were pumped on promises had no value to begin with.

So, once you've chosen the coins you'd like to invest in, you should transfer them to cold storage and lock them for a long-term HODL. Do not let your attention get distracted by short-term sobs or euphoria.

While keeping your coins you should check in not at the price but at the development roadmaps. You should focus on real-world adoption cases that can confirm your opinion.

Obviously, this does not mean you should never change your mind. If something has basically changed to the project that deserves a different evaluation, so you can include it in your analysis and re-evaluate your investment horizon.

Contribute to the cause

It is not just about buying a cryptocurrency, sending it to your cold room and then moving away in the hope that others will use it and rely on it. You should actively contribute in any way you can.

The beauty of cryptocurrency is that it is open source. This means that community contributions are encouraged. They also help crowdsourcing talent through a global pool of truly intelligent developers.

Can not code? No problem, there are many other things you can help.

For example, you could help make the Bitcoin network more decentralized by running a full node. You can do it with a series of other cryptocurrencies that rely on decentralization for their safety.

You can also help to make the project known. Some of the most technically involved projects do not have time to focus on marketing the currency. This is where community-led efforts work so well.

Create a community Twitter account or a blog that aims to provide news and resources on the currency in question. More than no-coiners and neophytes are able to learn on a project from these resources, the greater the adoption we will probably see.

Some of the most promising projects and cryptocurrencies are those that have a dedicated and distributed community that works towards a common cause.

We have been here before

In times like this bear market it is important not to lose sight of the forest for the trees. Bitcoin has gone through similar periods of retracement of prices and the consequent fall in the market. In the end the market tends to its long-term value.

Yes, there will probably be many shitcoins that will end up dying. There has never been any value in these projects and they have been inflated by pump-and-dumps and FOMO.

Just as the dot-com bubble has rocked the weak internet companies, this bear market will separate the wheat from the straw.

Emerging from the same dot-com crashes were Amazon, Apple and Google. With prices at the lower levels, some investors have collected them on the basis of their value proposition.

If you had purchased Amazon immediately after the arrest, you would have returned 208 times your investment. Furthermore, Amazon has transformed the way we live our lives and replaced entire industries.

This is what we want from the cryptocurrency ecosystem.

Image in the foreground via Fotolia