CRO Hits New Lows After ETF Cancellation—Here's Why I'm Still Buying and Staking
This morning, CRO briefly broke below the $0.050 level. Yesterday, the CEO of Crypto.com, Kris Marszalek announced that the ETF with Trump Media Group has been cancelled.
https://x.com/kris/status/2085826456798830701?s=20
The CRO token tends to swing wildly with news. In my own experience, it tends to have exaggerated movements before eventually settling on a market price. And when things go well, the upswings are exaggerated too.
Yesterday, I posted that I would be locking up CRO in a 4-year stake. In addition, this is a good opportunity to buy with the limited funds I have. With what I have cobbled together, I have brought my average cost from $0.08434 to $0.08372. As new lows are reached, I'm continuing to buy a little bit to try to maintain a set dollar value. I don't have the funds to buy what for me are large amounts. But I can at least try to hold a nominal value of my bag.
Why Catch a Falling Knife?
You might be wondering why I would attempt to catch a falling knife. I don't quite see it that way. I see the current conditions as a perfect setup for the next bull run with CRO.
In the past, I've made a lot of money from CRO, thousands of dollars. It all started by stacking up when it first launched. I also bought aggressively below $0.20.
Since that time, the tokenomics have shifted. The Cronos blockchain re-minted 70 Billion tokens that it had previously burned bringing up the maximum supply to 100 Billion. Of that, about 47.3B are in circulation. I expect the remaining supply to continue to suppress the price for some time. But that's a good thing, in my opinion. It gives me time to accumulate CRO via buys and staking over the long term, which is 10+ years. Even if the price of CRO remains stagnant, I'll have nominal gains from staking rewards, particularly now that the blockchain has instituted termed lock up staking. A 4 year lockup yields 11.44% at present, versus flexible staking at 4.44%. Even if the price of CRO is $0.05 in five years, my bags would accumulate roughly 50% of its current value.
When people bring up the falling knife analogy, what they mean is that you should just wait for the bottom and then buy. The trouble with this analogy is that nobody knows when a token has peaked or bottomed. It is cognitively easier for me to pick a dollar value and just try to maintain that dollar value when the market is dipping, rather than look at charts and analyses trying to guess the bottom.
Why I'm Optimistic About CRO In This Environment
Besides being a bit of a contrarian, there are other reasons for the optimism about the CRO token. First, CRO has two organizations that support it. The first is Crypto.com, which uses CRO as its utility token. Both their crypto exchange and stock exchange use Cronos. Yes, stocks bought on the Crypto.com platform are tokenized on Cronos.
Second, the Cronos developers are working on the Cronos App, which will soon be released, providing users the ability to trade about anything: crypto, stocks, perps, futures, and more. Their new operating model will include buybacks and burns to reduce the overall amount of circulating tokens.
With those two reasons alone, I feel some confidence that the price of CRO will never reach zero, at least in the foreseeable future.
The recent addition of locked term staking is also a positive. On X and Reddit, there is a loud contingent of people who take every opportunity to trash talk CRO, some of it deserved. These types typically want price to go up so they can sell. They're just angry that they bought high and have been unable to unload. If they were smart, they'd buy more at present prices to lower their average cost. But I suspect that there are also many CRO holders who are buying and locking in their stakes for 4 years. They're in no rush, having a long-term investing horizon. Staked CRO reduces the amount of CRO in circulation, which has an influence on market price.
Finally, I'm optimistic because I have been at this price level before. And all cryptos are struggling at the moment. Exchanges are closing. The BTC hash rate is declining. It's a bad environment, overall. You make money when you buy, not when you sell. The market as a whole is underpriced. CRO is severely underpriced. Traders see the sky falling. I see dollar signs falling.
Is This Too Much Optimism?
Could I be overly optimistic? Perhaps. But as they say, only invest what you can afford to lose. My CRO bags are not my largest holding, which is BTC. My sense is that I've been here before and have a good outlook on what is coming. I don't know if CRO will ever reach $1 or more. But even if CRO only reaches $0.50 or $0.25 in the next bull run, I'll be in profit. Buying and staking now is lowing the hurdle.
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