For a long time
people have been asking the same question.
"What actually protects your money in a crash?"
Most answers sound the same.
Gold.
Bonds.
Cash.
Diversification.
Sure.
All necessary pieces.
But once you actually look at coins like Bitcoin and Hive...
I think there's a deeper answer.
Data has to be honest
Every backtest has a lifespan.
Stock data goes back over a hundred years.
Gold too.
Bonds too.
But Bitcoin only since 2013.
Hive only since 2020.
The whole premise of "30 years of data" doesn't even apply to coins.
If you don't admit that up front...
the backtest is a lie before it even starts.
The illusion called correlation
A lot of people believe
gold always moves opposite to coins.
Bonds are always safe.
I don't buy it.
Around the 2022 bear market bottom, the BTC-gold correlation swung wildly.
Some stretches almost inverse.
Some stretches almost identical.
When liquidity is loose, coins rip.
When liquidity tightens, coins break.
Regardless of gold's narrative.
So trusting one single asset to save you.
That itself is the risk.
What the numbers actually say
2018, down 84% from the top.
2022, down 77%.
2014, down 86%.
The pattern repeats.
And a small alt like Hive...
drops deeper, and stays down longer.
Try to offset it with gold or bonds.
The drawdown on a small-cap asset just doesn't offset.
So I changed how I think about it
I stopped trying to hedge Hive directly.
Instead I just keep the position small from the start.
Capping the weight itself.
That's the only variable you actually control.
The structure I run
Offense, BTC and Hive, 40 to 50 percent.
Hive capped under 5 percent of that.
Gold, 20 to 25 percent.
US short-term treasuries or cash equivalents, 15 to 20 percent.
Low-vol dividend stocks, 10 percent.
Each piece has a job.
Coins are offense.
Gold is defense that doesn't care what regime you're in.
Short bonds are the last line during a liquidity crunch.
Dividend stocks fund the rebalancing.
Rebalancing, two ways
Mechanically rebalancing every quarter.
Not enough on its own.
Coins blow past their target weight in a single day.
So I add band rebalancing on top.
Drift 5 percentage points off target, rebalance immediately.
And trend.
Break below the 200-day, cut coin exposure in stages.
Recover above it, add back in stages.
Nothing different from what I've already been doing.
What I think
Before I dug into this.
I figured one hedge asset would be enough.
It's not.
Technology doesn't protect the asset.
Structure protects the asset.
Setting the weights.
Checking for drift.
Mechanically rebalancing.
That structure is the real shield in a downturn.
In the end
Bitcoin doesn't shake because of an algorithm.
Hive doesn't shake because of its ecosystem.
Neither can be stopped.
But a portfolio is different.
A portfolio can be designed.
You can't erase the drawdown.
You can build a structure that survives it.
A structure that survives the drawdown
Now let's fill that structure in with actual numbers.
The portfolio again
Bitcoin, 40 percent.
Hive, 5 percent.
Gold, 20 percent.
US short-term treasuries and cash equivalents, 20 percent.
Low-vol dividend stocks, 15 percent.
Same as before.
The problem is that 5 percent, Hive.
Just holding Hive as-is
doesn't protect you from the alt.
Already covered that.
So I move part of that 5 percent Hive into HBD.
60 percent into HBD, to be exact.
The other 40 percent stays as Hive.
Why 60 percent
Move 100 percent and you miss the upside.
Move 0 percent and you eat the full drawdown.
60 isn't a compromise.
It's a calculation.
Even in a Hive downturn, more than half the position stays preserved at the dollar peg.
And the remaining 40 percent still participates when it recovers.
After converting to HBD
Converted HBD doesn't just sit there.
It goes straight into savings, staked.
Currently 20 percent APR by witness vote.
That number isn't fixed.
It was 10 percent before.
12 percent at one point.
Dropped as low as 3 percent too.
Witnesses can change it anytime by vote.
So I run the math assuming 20 percent.
But I also check whether the structure holds at a floor of 10 percent.
It holds.
The interest doesn't stop in a downturn.
No matter what the price does.
Principal stays at a dollar.
That's how you actually survive the drawdown.
How many years do you hold
A crypto cycle runs roughly four years.
Halving, run-up, correction, halving again.
I set the minimum hold at half that cycle, two years.
The reason is simple.
Sell before two years
and you miss the interest.
And you miss the price recovery too.
So minimum two years.
Maximum four.
Past four, you're into the next cycle.
At that point, reassess from scratch.
When do you sell and rebalance
Three signals.
First, band drift.
Five percentage points off target.
Rebalance immediately.
No exceptions on this one.
Second, Hive price reclaims the 200-day.
And holds above it for a month or more.
That's when I convert some HBD back into Hive.
Back in for the upside.
Third, if Bitcoin breaks below its 200-day.
Cut total coin exposure.
This is where HBD actually earns its keep.
It's already a cash equivalent.
No need to sell anything first.
Move it straight into gold and short bonds.
No lag.
Conversion takes a day, maybe two.
In a downturn, that day or two is everything.
The operating routine
Once a month.
Check portfolio weights.
Drift, rebalance.
No drift, leave it alone.
Once a quarter.
Check the HBD interest rate.
Did the witnesses change it.
If they did, recalculate the minimum hold.
And every cycle, every two to four years.
Review the whole structure.
Keep it as-is, or change it.
In the end
You can't erase the drawdown.
But facing it.
Knowing what to sell.
What to hold.
What to buy back.
If that's already decided ahead of time.
That's a structure.
And that structure
starts with trusting the rules, not the price.
