We get it. Bear markets are painful. These are not fun times to endure.
It is difficult to watch the value of our account plummet. Nevertheless, that is a way of life with the markets. They go up but they also go down. What brings about success is how we deal with them.
In this article I will reveal the difference for me between these bear markets. As will be shown, there is a way to benefit from the rough times.
When the last bear hit, I was probably about a year and a half into cryptocurrency. At that time, my holdings were growing steadily until that fateful January in 2018. That marked the onset of the "Crypto-Winter" that would endure for a few years.
The long-term approach is something that I try to implement. Thus far, I have not been required to access my cryptocurrency to meet everyday expenses. Therefore, it is a bit easier to be a HODLer.
Nevertheless, it is something that is suggested to everyone. Here we will show the difference a couple years can make.
In January 2018, my total cryptocurrency holdings peaked at roughly $180,000. This was a nice sum to amass in a relatively short period of time. It was a combination of effort along with investing some money. The bulk, however, came from the bull run.
Of course, the holding dropped a great deal from there. I honestly have no idea what it got down to but I do know my actions did not change.
If we fast forward to 2021, there was a day where I went to bed with over $1 million in holdings. This occurred with HIVE not getting close to the high it reached back in 2018. It was offset by the fact that I hold a lot more HIVE than I did back then.
This is the key to long term success.
Bulls markets will come and go. The same, obviously, is true for the bear. So we simply plug along, understanding what is taking place.
Many will say the best time to build is during the bear market. From this perspective, it means keep filling the bags. It is imperative that one focus upon pouring as much cryptocurrency into one's wallet as possible. The bear market is a great time for this.
To start, if one is investing fiat currency, the money goes a lot further. Basically, you favorite coins and tokens are on sale. Bitcoin was about 60% off from where it was at the peak. This is a pretty good deal.
The reason we do this is simple mathematics.
Let us say, you had 1 bitcoin when the price was $66K. That means your holdings of BTC was $66K. We will presume a purchase price of $20K, for a $46K profit.
Now let us say you add another Bitcoin at $30K. The holding jumps to 2 Bitcoin. If the price reaches the previous high, the total will be $132K, or a profit of $82K.
As we can clearly see, the second bull run is more profitable since our holdings are larger.
This is what filling the bags does.
While purchasing our favorite assets on sale is a wonderful approach, Hive offers an additional opportunity.
Since one has the ability to be rewarded for what is produced, there is the potential to fill our bags without laying out any money. This is the epitome of dollar cost averaging since we additions are at zero financial cost.
There are a large basket of options on Hive. We know that people earn HP and HBD from their posting activities. Curation of content also provides another payout for many. Then there are all the Hive-Engine tokens which offer up another layer of rewards. Financially, there are the games which can payout in cards and other assorted in game assets.
Almost all of this was beaten up (actually down) over the last 6 months. Everything is getting crushed by the overall market activity. That said, those who are looking at expanding their holdings will find themselves in the scenario described above. Having more tokens means a larger value once the bull returns.
This approach does require time and effort. It is what is being used in lieu of forking over money to purchase our favorite cryptocurrency. Most importantly, consistency is vital.
How long will the bear last? Nobody knows the answer to this question.
What we do know is that daily activity during the entire market run down will help to keep growing one's holdings. The overall market can be painful yet we can benefit in the long run.
This is my approach to surviving the bear. What is yours? Let us know in the comment section below.
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