CRYPTOCAP ~ Analysis: May capitulation & what to do...
For those of you who are not new to crypto - you might as well just skip this post - because all this info you already know.
For the rest of you - look at the chart.
This is the crypto market.
Look at the last long-term bullrun 2017-2018, where we had multiple major dips and even capitulation events. From -32% to -69% within short time periods (days or weeks).
This is called normal.
Where other markets make -5% retracements, crypto makes -30% retracements.
The major difference between other "markets" and the "crypto market" is that crypto is not actually a "market" - it is a new financial system & monetary system - that has created new "mediums of exchange" (currency) and "stores of value" (asset).
So, it doesnt actually matter when you buy in. As long as you are buying the real projects (the real currencies and assets) - you are hedging your economic value into what will control the future of human economic interaction & value.
Over time, all these assets & currencies (the ones that succeed at solving their problem) - will just go up.
As a "market" - we will continue heading to $10T asset-class at which time it will go absolutely parabolic as it will finally be understood worldwide (including by the late-term skeptics) that this is the new financial and monetary system of humanity.
For those of you who are afraid (fear index is 11 right now, which is lowest its been in years) - look at the chart:
1) ***The current capitulation event of May 19-20 wound up over an approx 7 day period and resulted in a -47% dump***
2) This is not even close to previous similar events even just last year for example - the March 2020 capitulation which was -65%. What happened after that? Bull run started and price floor on BTC was locked in at $3800.
3) In the bullrun of 2017-2018 we had multiple major dips and at least 1 (or 2, depending how you look at it) capitulations, from -32%, -45%, -47%, and -69%. In this bullrun we've only seen 2 major moves: -28% and -47% (the may 19-20 move). Get the picture?
4) IE: BTC price floor was set at $3800 just 14 months ago (march 2020). In the recent capitulation (the 4th in cryptos history....old news....) the price floor has been set at $29k. Thats a 9x in 14 months total value locked. Which asset in human history has ever achieved this? Yet this is normal for crypto. BTC has gained an average 350% per year for over 10 years now. Thats 4.5x per year on average.
The recent FUD campaign included:
1) China "bans" cryptocurrency. REALITY CHECK: The report was a "repeat" of the legislation China announced in 2013. No new laws or legislation whatsoever. Simply an "announcement" repeating what they already said in 2013.
2) Elon Musk.....mr clueless
3) US Fed, Banking & Media have been piling on FUD - at the same time behind the scenes "quietly" they are exploding with new crypto ETFs, asset management at banks, and new crypto offerings.
This, too, is a repetitive cycle of elites to FUD retail to sell their cryptos, so that they can BUY it.
Looking at the OTC desks in the last few days, there has been over 500% increase in BUYING and its all been institutions, funds, wall street, banks....
They FUDDed retailers to dump $1T of crypto so that they could buy it up cheaper.
So what do I do?
I did not sell a single crypto in the crash.
Sure, I lost over $100m in my portfolio. I'm down more than -30% overall.
So what? I did not sell a single coin. I only bought, and I'm still buying until my stablecoins are all converted into cryptos and I'm back down to 1% fiat.
I am also using the crypto tools available to me, and always make downturns benefit me:
1) Put lots of your cryptos in a crypto bank account like celsius or nexo. Now, instead of selling your cryptos when the market crashes, you loan at 1%APY (with 4:1 collateral) and use your loan to buy more. For every $100k crypto you have, that means $25k loan at 1%APY (on celsius, as an example). You keep all your cryptos, use them as collateral, and have more powder to buy more.
2) Stake the best yielding cryptos, and gain anywhere from 10-50%APY. The more time the market takes to correct itself, you wont even care - because the higher the volatility is, the higher the APY% is on these staking mechanisms. THE BEST TIME TO BE STAKING is when market is super volatile. APY% rates can go up double or triple during these times. Why would you NOT want to gain free yield?
3) Stop getting upset that you didnt "buy the bottom". So your recent purchase is -20%? So what. Wait a year and it'll be +200%.
4) Always remind yourself: your economic wealth can be measured in USD$ or EUR$ --- or it can be measured in BTC or ETH (or a big mix of whatever cryptos you believe in). Which is the stronger asset? USD$ and EUR$ are going super inflation and have negative APY%. Cryptos are the stronger asset & currency with hugely positive APY%. Which asset would you rather STORE and INCREASE your wealth in?
Those of us who have already been here, already been suckered by these moves, already lost our cryptos in previous cycles - we just sat back and bought more, alongside the rest of the elites who want your cryptos.
For the rest of you - look at the chart.
This is the crypto market.
Look at the last long-term bullrun 2017-2018, where we had multiple major dips and even capitulation events. From -32% to -69% within short time periods (days or weeks).
This is called normal.
Where other markets make -5% retracements, crypto makes -30% retracements.
The major difference between other "markets" and the "crypto market" is that crypto is not actually a "market" - it is a new financial system & monetary system - that has created new "mediums of exchange" (currency) and "stores of value" (asset).
So, it doesnt actually matter when you buy in. As long as you are buying the real projects (the real currencies and assets) - you are hedging your economic value into what will control the future of human economic interaction & value.
Over time, all these assets & currencies (the ones that succeed at solving their problem) - will just go up.
As a "market" - we will continue heading to $10T asset-class at which time it will go absolutely parabolic as it will finally be understood worldwide (including by the late-term skeptics) that this is the new financial and monetary system of humanity.
For those of you who are afraid (fear index is 11 right now, which is lowest its been in years) - look at the chart:
1) ***The current capitulation event of May 19-20 wound up over an approx 7 day period and resulted in a -47% dump***
2) This is not even close to previous similar events even just last year for example - the March 2020 capitulation which was -65%. What happened after that? Bull run started and price floor on BTC was locked in at $3800.
3) In the bullrun of 2017-2018 we had multiple major dips and at least 1 (or 2, depending how you look at it) capitulations, from -32%, -45%, -47%, and -69%. In this bullrun we've only seen 2 major moves: -28% and -47% (the may 19-20 move). Get the picture?
4) IE: BTC price floor was set at $3800 just 14 months ago (march 2020). In the recent capitulation (the 4th in cryptos history....old news....) the price floor has been set at $29k. Thats a 9x in 14 months total value locked. Which asset in human history has ever achieved this? Yet this is normal for crypto. BTC has gained an average 350% per year for over 10 years now. Thats 4.5x per year on average.
The recent FUD campaign included:
1) China "bans" cryptocurrency. REALITY CHECK: The report was a "repeat" of the legislation China announced in 2013. No new laws or legislation whatsoever. Simply an "announcement" repeating what they already said in 2013.
2) Elon Musk.....mr clueless
3) US Fed, Banking & Media have been piling on FUD - at the same time behind the scenes "quietly" they are exploding with new crypto ETFs, asset management at banks, and new crypto offerings.
This, too, is a repetitive cycle of elites to FUD retail to sell their cryptos, so that they can BUY it.
Looking at the OTC desks in the last few days, there has been over 500% increase in BUYING and its all been institutions, funds, wall street, banks....
They FUDDed retailers to dump $1T of crypto so that they could buy it up cheaper.
So what do I do?
I did not sell a single crypto in the crash.
Sure, I lost over $100m in my portfolio. I'm down more than -30% overall.
So what? I did not sell a single coin. I only bought, and I'm still buying until my stablecoins are all converted into cryptos and I'm back down to 1% fiat.
I am also using the crypto tools available to me, and always make downturns benefit me:
1) Put lots of your cryptos in a crypto bank account like celsius or nexo. Now, instead of selling your cryptos when the market crashes, you loan at 1%APY (with 4:1 collateral) and use your loan to buy more. For every $100k crypto you have, that means $25k loan at 1%APY (on celsius, as an example). You keep all your cryptos, use them as collateral, and have more powder to buy more.
2) Stake the best yielding cryptos, and gain anywhere from 10-50%APY. The more time the market takes to correct itself, you wont even care - because the higher the volatility is, the higher the APY% is on these staking mechanisms. THE BEST TIME TO BE STAKING is when market is super volatile. APY% rates can go up double or triple during these times. Why would you NOT want to gain free yield?
3) Stop getting upset that you didnt "buy the bottom". So your recent purchase is -20%? So what. Wait a year and it'll be +200%.
4) Always remind yourself: your economic wealth can be measured in USD$ or EUR$ --- or it can be measured in BTC or ETH (or a big mix of whatever cryptos you believe in). Which is the stronger asset? USD$ and EUR$ are going super inflation and have negative APY%. Cryptos are the stronger asset & currency with hugely positive APY%. Which asset would you rather STORE and INCREASE your wealth in?
Those of us who have already been here, already been suckered by these moves, already lost our cryptos in previous cycles - we just sat back and bought more, alongside the rest of the elites who want your cryptos.
Comment:
A note on buying "shitcoins":
Do you buy shitcoins? .......... well then I dont think you and I are from the same species, because that alone says everything.
Capitulation events, which is happening right now, are catalysts that put shitcoins back to $0 where they belong.
I'm afraid that my DOGE mining setup which was making me $18,000 USD/day is not going to last much longer, sadly.....but thats a good thing too, because crypto needs to cleanse itself from degens.
This happens every time, and is what capitulation events are made of. Degen bubbles.
This is the forest fire that revitalizes the cryptosphere.
I invest in projects that ive fully researched, that have good teams, that solve a problem, that have utility.
if they go to $0, i do not sell. thats fine with me. it means the project failed, but I only invest in what I believe will succeed - knowing that not all of them will.
I also invest in tech startups, and so far 60% of my startup investments failed too (which is a much lower failure rate than the 90% industry average, mind you).
but i never invest in shit. be it a company or a crypto - because they are the same thing really.
Do you buy shitcoins? .......... well then I dont think you and I are from the same species, because that alone says everything.
Capitulation events, which is happening right now, are catalysts that put shitcoins back to $0 where they belong.
I'm afraid that my DOGE mining setup which was making me $18,000 USD/day is not going to last much longer, sadly.....but thats a good thing too, because crypto needs to cleanse itself from degens.
This happens every time, and is what capitulation events are made of. Degen bubbles.
This is the forest fire that revitalizes the cryptosphere.
I invest in projects that ive fully researched, that have good teams, that solve a problem, that have utility.
if they go to $0, i do not sell. thats fine with me. it means the project failed, but I only invest in what I believe will succeed - knowing that not all of them will.
I also invest in tech startups, and so far 60% of my startup investments failed too (which is a much lower failure rate than the 90% industry average, mind you).
but i never invest in shit. be it a company or a crypto - because they are the same thing really.
Volume is decreasing while people "recover".
Remember: you only lose money in crypto when you sell lower than you bought.