Brian Wallace, Founder & President, NowSourcing
Crypto investments have shown that they’re a severe opportunity and are here to stay despite the doomsaying that was present initially upon their appearance. More and more people wish to become part of it and are buying into various currencies, be it the giants such as BTC and ETH, or perhaps some smaller ones which are less known but far cheaper. While it’s easy to invest in a good market, a bearish market can sometimes be hellish. Still, we’re here to show you the brighter side of things and why a bear market can be appreciated for certain aspects, especially crypto investments. If you have any other questions about crypto, we recommend high-quality info for crypto investors at crypto news. Without further ado, let’s tackle the topic at hand.
What is a bearish market?
Before we can get into the details, we need to understand what a bearish market is. Simply put, it’s a market where the values have been steadily dropping across the board. Generally, the mark is when the prices have dropped by 20% or so compared to when they last peaked.
Bear markets are incredibly volatile, just because the price dropped doesn’t mean it can’t sink even further. People often “buy into the dip” far before the currency has reached its lowest point. Bear markets have high supply and pitiful demand and are risky, especially for those who don’t have much experience in the world of trading.
What are the upsides, then?
Given what we’ve said so far it may seem that bearish markets are a lawless hellscape that should be avoided as much as possible. While it is true that they’re incredibly risky and many investors dread their appearance, it’s also true that many crypto investors are big risk takers. Cryptocurrencies in general are pretty volatile, so many investors simply view this as a slightly more chaotic day, rather than a hellhole as regular market investors may.
High risk in this case, also means higher reward. If you do manage to predict the lowest point of certain currencies, then you can buy in at a very optimal price and end up reaping significant profits after the market stabilizes and prices begin to grow once again, as is inevitable, Remember how bearish markets require about a 20% or so drop to be seen as such? That also means there is potentially a 20% or more increase down the line if you can predict when to buy in.
Significant risks and crypto investors, name a better duo. It’s not surprising that bear markets no longer seem as scary as before as the general level of risk-taking has increased with the dawn of cryptocurrencies, which we believe has made investments incredibly fun.
Should you invest in crypto during bear markets?
Our answer is a resounding yes. However, there is a catch. While we do recommend using the opportunity of a bearish market to buy currencies at incredibly low prices, it’s also important to remember that if you wish to invest in such a market, it will take a lot more analysis and thought to do well. If you simply buy in randomly, then the chances of losing money are astronomical.
View this as an opportunity to practice your patience and analytical skills as an investor. The chance for big profits is there, you simply need to be good enough to spot it when it arrives and not let it slip.
We recommend exploiting the bear market as best as you can, but only if you are confident in your capabilities and trust that you will be able to figure out when the drops finish, and the rising begins again.
Bear markets are an incredible opportunity for crypto investors, and we wholeheartedly recommend using them if you have the skills and patience required for such a task. High volatility has always been the name of the game, so if anyone can make use of its none other than crypto investors as risky ventures have been their domain for quite a while already. We wish you the best of luck.
About the Author: Brian Wallace is the Founder and President of NowSourcing, an industry leading infographic design agency in Louisville, KY and Cincinnati, OH which works with companies ranging from startups to Fortune 500s. Brian runs #LinkedInLocal events, hosts the Next Action Podcast, and has been named a Google Small Business Adviser for 2016-present. Follow Brian Wallace on Linked