Author – Mil, Asia Crypto Correspondent
Blood on the Water
It seems that the January’s market correction is not yet over. The cryptocurrency market, once again took a nosedive in prices. The top coins and tokens are taking huge hits ranging from 10-40% decrease in market price. Among the major coins dipping in price are Bitcoin (14%), Ethereum (13%), Ripple (25%), Bitcoin Cash (20%), and Cardano (30%).
Bitcoin has nosedived to the $8,600 territory—a price range it has not seen since November 2017. There is much panic and FUD ensuing in the market as evidenced by the total market capitalization hitting the $420 billion level. The market is bleeding, and many investors are pulling their money out of the cryptomarket.
There is no clear reason why the market is currently on the downside. Some say this is still a continuance of the third wave of corrections that started during the last weeks of January. Others believe that the Lunar New Year preparations for Asian investors are still in play. There are also speculations that the increased scrutiny in the South Korean, Chinese, and Indian cryptomarkets are major contributors to this market dip. Also, FUDs from the outdated Tether news could be affecting the market. Even the analysts admit that there isn’t really one clear explanation with what is happening in the market. It may be one of these factors, or it maybe all of these factors that are affecting this huge market crash. One thing is for certain: the cryptocurrency market will be tested.
Cut Loss or HODL?
If you are a new investor in cryptocurrencies, chances are that you are now willing to pull your money out and just take the loss. Some call this strategy cutting losses. But with many long-term and long-time investors in the cryptomarket, this market dip is just like the other market dips. If you have done your research, and you believe in the token or coin that you are invested in, then you might buy more or simply hold on to your investments until this storm is over. If that is the case for you, then you are a HODLer. There isn’t really one best advice during these times. It is how you are able to handle taking risks.
Handling the Dip
If you are a HODLer or you would like to be a HODLer, here are some tips for you to handle the dip.
- Find a new hobby. If you are so used to checking the stats and price graphs all the time, now might be a good time to look for a new hobby. Take your mind off the market until the crazy storm is over. Looking frequently at the market prices might tempt you to sell and cut your losses. If you would like to be a HODLer, you would not want to do that.
- Stay away from crypto-skeptics. If you have friends or family who are skeptics of cryptocurrency, you might want to stay away from them for a while—or at least don’t go to them talking about the cryptomarket. We are not telling you to run to the mountains and cut ties with them; just don’t open up your frustrations and FUDs to them with regards to the cryptomarket. You don’t need to add fuel to the fire.
- Develop an iron fist. If you would like to be a true HODLer, then you must have an iron fist. If you have a firm belief that your token or coin has potential, and that your investment would moon in time, then do not sell. Hold on until the market recovers. There is no way of knowing when the market recovers, or when your investment would moon, but if you believe in the technology of your investment, then hold on to it with an iron fist.
- Make room for the market to grow. It is helpful to remember that the cryptocurrency market is just in its infancy stage. Majority of the people are still yet to discover the innovations and advancements of the blockchain technology. We have not yet seen the full potentials of the cryptomarket, and being impatient of its growth will take you nowhere. Allow the market to mature, and with it your investments. Keep in mind that the major increase in total market capitalization and the major increase of token and coin prices only happened during the last half of 2017. We are only seeing the beginning. HODL.
- Spread your investments to many different coins or tokens, depending on your risk capacity. You can lessen risk of losses during market storms by investing in a diversified portfolio. Do your research, and spread your money.
- Be patient and HODL. To sum everything up, it all boils down to your patience and resilience. Do not be overtaken with the FUDs ensuing in the market. Again, if you have done diligent research and you were able to cover all the bases, then there’s no reason for you to be swept along by the floods of money going out of the market. Just stand your ground, be patient, and HODL!