Happy Holidays to all! I intend to share with you some helpful insights as we head into the New Year.
The hodler’s dilemma? What should you do?
First, you have to know yourself. I am serious. Sit down, and write the reasons why you are putting money into this market. Is it to explore the blockchain? Buy a meme coin hoping financial insanity continues? To accumulate wealth? Maybe and this is rare, you found a platform or community you have complete conviction in.
One thing is clear, you must have your goals of what you want from the market before jumping into it. By classifying what we stand to gain and lose from a market primarily based on the exponential growth of technology, you will learn to better understand the possible opportunities that can be taken advantage of.
In It For The Tech
Maybe you heard this browsing around the crypto culture on Twitter or elsewhere. What exactly does it mean?
Let me share with you all a story. Back in 2016, ethereum was just starting to gain traction. It was around $3-$12 per coin, and if you used it after only knowing bitcoin, it was a significant upgrade. The speed at which you can send eth was under 30 seconds, the fees were low, and it was indeed a sight to behold. Basically, the opposite of today, surprisingly. For those early enough to experience the sensation, you would understand. It indeed was a remarkable piece of technology.
Nowadays, we sorta have that, yet we sorta don’t. There are competitor platforms and a lot of forks(replicas) of already existing code and concepts. For example, Binance Chain(BSC) is a clone of Eth’s Geth. Which was a fork from eth as ethereum started to change.
I don't, in fact, believe eth technology is superior like it was in 2016/2017. So let's get on with it. In 2017, after a significant surge of interest in cryptocurrencies, the market almost climbed up to 1 trillion in total market cap a little over 4 years ago. A select few understood there was a scaling problem. This scaling issue even started a war on bitcoin with BCH/BSV forks. Not going to go into much detail with BTC, since the devs have scaled and fixed many problems plaguing the blockchain 4 years ago. The same cannot be said for ethereum.
Cryptokitties, the original (OG) early version game, sent ethereum gas fees to the moon and clogged the network. Little did I know ethereum would never go back to its true glory when I first used the chain. All these factors combined with the significant institutions shutting down the market. They had no interest in letting the bubble get any bigger. Credit cards were blocked from purchasing bitcoin. KYC on almost all exchanges was enforced strictly. Buy limits were enabled on coinbase and major FUD campaigns spread across the media.
Now you know what started the infamous 2018 bear winter. Which would last all the way until Q2 2020. Before ushering in a rapid bull market in Q4 2020, which flourished all throughout 2021.
Mainstream Digital Currency
As we enter 2022, ask yourself what market conditions we are in. I hope the story helped you with your plan somehow, even if it was only a little.
I was a technology enthusiast then. Still am, although now I consider myself more of a speculator, trader, and based on the story I shared earlier, an investor in specific platforms at the correct times. All because I understood from past experiences, there is nothing new under the sun. It is all cyclical. We at Emporos Research could find ideas and platforms to own, like Solana and its ecosystem. Luna and its interconnected ecosystem. A couple we missed, for example, AVAX. In a continuously growing market 24/7, 365 days a year, one should not hold any regrets.
The Mainstream floods Into the Space
What we noticed in 2021 is the total lunacy of financial markets, which overlapped with crypto, contributing to its boom in price. Most have heard of bitcoin and ethereum now, and a lot even got rich (Meme Coins). Now it will be even more challenging to separate noise from reality. Misinformation is spreading, and if you read The Sovereign Individual, you may understand how the ability to think critically and generate strong ideas will be precious in the coming decade. I am not saying there will no longer be an opportunity to make insane returns. Crypto is only a 2-3 trillion market currently. I actually think things will become even crazier. You just need to be aware of upcoming catalysts that will revert most inexperienced players’ newfound wealth back to dust.
As legend Warren Buffet says, a market is a device for transferring money from the impatient to the patient. The catch with him is, he would invest in actual companies that made money and even put his own people in to bolster his edge in the long run. Can you say the same for most of these crypto companies and projects’ ability to survive or innovate in a way that solves problems? This is the hodler’s dilemma.
Upcoming Market Catalysts
The government has not yet fully regulated the space to the extent they would like to. A lot of policies will be implemented in late 2023/2024). Because of this, the market should out-innovate a lot of the regulation for the time being. However, it will impact many people who do not know how to protect their cryptocurrencies adequately.
In line with the above, governments will not only be strictly regulating the space, but they will also be entering it themselves. CBDC (Central Bank Digital Currencies). This is real and will happen. The best way to gain control is to enter the market. All transactions and cash-out systems for unsophisticated users will be tracked and monitored.
Investing in this market is speculating. Yes, you need to understand that this is not the traditional level of investing most people are used to. You should learn basic trading skills, how to hedge, create multi-sig wallets, implement cold storage, and protect your coins. It does honest and genuine investors a disservice telling them to just “hodl” through the volatility. It's similar to someone rubbing it in your face; if you just held that apple stock you bought 30 years ago, you would have xxxxxx amount of money. You need to understand your own cash flow and plan for such uncertain variables.
Remain true to yourself. Do not rush. Quick fast money usually comes at a high cost to your well-being and mental health. Plan what you want from the market, explore and experiment with the technology and make your own decisions. I am a trader and am well positioned to take advantage of significant market moves created from these coming catalysts. Understand what is best for you and your own cash flow and risk tolerance.
I hope you enjoyed the article and now understand the best path for you to choose in this bountiful market blessed with opportunity. Have a wonderful New Year!