A lot of the people are struggling with their crypto investments and are down big. My portfolio went down quite a bit in the last 7 days as well. Nonetheless, there is a recipe to crypto investing that makes it easy to do compared to stocks. So here is a simple set of rules that even beginners can follow. We will start with the bear market as we are currently in one right now.
Step 1 Bear Market means 100% BTC
So for people who are about to enter the current market, it is a bear market and a bear market means 100% BTC. When you are DCAing, you just put everything into BTC. Simple, right? Don’t get fazed by anything and don’t let some random alts mooning upend your routine. Just BTC.
Step 2 Wait Until the Next Bull Market
Eventually, we will hit a bull market, and this means that BTC will go parabolic. In lots of these bull markets, BTC will go up faster than alts and alts would have bled out anyway so your 100% BTC will be better off than an alts portfolio. So when do you hold BTC until? Two things: (1) see that the previous ATH (in this case 69K) is broken (2) see that BTC starts to stagnate. Part (1) is easy as there is a right and wrong answer. Part (2) is difficult as it is not easy to know when BTC has stagnated or not. So there is a certain “feel” to it when it comes to Part (2). Nonetheless, one hint is that alts will start to the moon at the stagnation stage.
Step 3 Altseason
Once BTC stagnates, move into a buffet of alts portfolio. Drop your BTC also as it will stagnate. Have an assortment of alts that are in flavor. I recommend that you enter into new alts and don’t go into those that have beens from the previous cycles as they are unlikely to go up. When it comes to 2024/2025, there will be all new coins with new sets of VCs and Proof Of Amazings etc. How do you know when altseason is over? It is difficult to tell but click on coinmarketcap.com and see if all of the alts in the top 100 have gone up 200-300% at least. Every one of them. There will be the last euphoric days when everything is going up 20-30% in the daily. This is the difficult part. At peak euphoria, sell everything and move into cash.
Step 4 Waiting Season
This is the tough part. You need to just move out of the crypto market and go all cash. Don’t buy on a 10% dip. You need to be patient and be prepared to stay in cash for 1 year or so. Just separate yourself from crypto altogether. Eventually, you will see a bear market. EVeryone will be depressed. This is where you enter in 100% BTC. Most likely, you will not gain immediately as you are buying in during a bear market. But eventually you will be back to Step #1 and the cycle repeats.