Surviving a market crash like a future Millionaire

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Avatar for TheEmpress
3 years ago

This is something I'm actually very good at since my first exposure to crypto currencies was in December of 2017. I happily bought a few hundred dollars worth that December and watched the market increase my investment every hour, thinking I was so super smart to have found something so utterly awesome to give me such good returns so quickly.

Thankfully in all of this glee and dreams of Lambos I also made sure to study the fundamentals of bitcoin and blockchain, the real meaning of money and the power of decentralization.

Yes, I read Satoshi's White paper, understanding about 1/10th of it but still completely amazed by the utter genius behind all of it. The few currencies I invested in I researched and knew they had strong use cases and awesome fundamentals.

Then I did the unthinkable for a newbie in the midst of a historic bull run.

I promised to make this a long term thing.

"No matter what, I will hold most of my Crypto for 10 years"

I said it originally thinking I would surely have millions of dollars by then given my investment of few hundred dollars increased by a couple of dollars every few hours. I wanted that Lamborghini and the fancy house and Crypto was going to provide me that. In additional I was going to learn the markets, to judge good projects from bad ones and to yes to code blockchain too. Cause you had to know how to code a blockchain if you wanted to really be good at this crypto stuff. Didn't all the top people in Crypto code blockchains for a living? After all, all the main folks that talked the smartest about blockchain had a project themselves, or were even starting an exchange.

I was a newbie, please don't fault me for the over enthusiasm and thinking I could go from plopping a few hundred dollars at Coinbase all the way to coding a blockchain in a few months with my non existing coding ability.

The euphoria lasted about two weeks, every day new marvels unveiled themselves before me as the bulls were running in full swing. My meager investment of Bitcoin bought at 11K were already almost at 18 K and I couldn't believe my eyes. Every news seemed to be talking about Bitcoin and I even discovered Ethereum, Bitcoin Cash, LiteCoin and XRP. I couldn't talk about anything else other than Crypto and I stayed awake until 3 AM checking the markets constantly. I was like a mother hen checking her chicks.

Then it came. Blood was in the streets, the market crashed. Hard. Really really hard. My euphoria turned to dread, what had I gotten myself into here? I had just topped off with Ethereum at 2 K and Bitcoin Cash at 4 K and another bit of Bitcoin at 19K. It all tumbled down the mountain like an avalanche. An avalanche of bloody newbie investor tears. Seeing it all in red I was like what now? The news spoke of Bitcoin being dead, people tweeted about Tulips and bubbles.

"No matter what, I said I'd hold all of this for 10 years. It's been less than a month"

I sighed looking over the carnage and decided right then and there that I would keep to my commitment. Ten years. Nothing less. As much as it shook me to the core I kept strong the entire crash, and little by little I purchased more crypto both in 2018, 2019 and even some in 2020.

It would take almost 3 years for the next really big bull run; but then I realized that it quickly surpassed the last one by a lot. I wasn't just up a bit in my investment by waiting and being patient, I was way up. Stellar had grown from 8 cents all the way to 53 cents, my 2$ LINKS had turned into almost 40 dollars, everything was so much more than even at the height of the bull run I had came into in 2017.

While I was happy and overjoyed I already prepared myself, as what goes up must come down again. I knew the market would run red again and I was ready. When the market now crashed in 2021, I swear, I didn't even blink. No reaction from me at all. I waited patiently for a bit more fiat to come into my hands and promptly bought up a few dips while hanging out on Noise.Cash.

How to deal with a Market crash:

1: Make a commitment for the long term: Set a goal for a certain amount of your crypto holdings, say at least 5 years, 10 years, 15 years. Then stick to it. While you can take some profits before then, maybe even swap one coin for another, keep most of your portfolio as it is for that time. And nothing gets done during a crash except to buy or acquire more crypto.

2: Check out a few new projects during a crash. Everything will be on sale and you'll want to know what to invest in when you get a little extra money. Because there's no FOMO and hype you can quietly and thoroughly check something out without having to worry about if you're gonna miss out on a great thing. It's a crash, there will be no FOMO and you'll have enough time to research and then purchase at will. In fact all the cool coins you wanted that were too expensive during the Bull run will be so tempting at the lower prices. If you took any profits during the up market, now is also a good time to replace anything you took out or exchanged.

3: Refresh yourself on the fundamentals. Go over again what makes blockchain and decentralization so powerful. See where the Space has gone in the last few years with innovation. This will distract you from the markets and help you gain your footing; you'll still see blood in the streets but you will understand why it's just a temporary thing.

4: Don't get overzealous at the first sign of recovery, it may not be a full recovery. Also don't think that a dip is the last dip. Be very careful trading in these times as it's easy to mess things up - that recovery may be a false one and if you sell you may find out missing a bigger recovery later, the dip you're buying may not be the deepest one and you may lose a little more money before the market finally recovers for real. Leave the see - saw weeks to the pros, as it can go up and down like a pendulum. If you buy then buy to hold long term. If you sell be sure you're happy with the price you sold for.

5: Markets crash, hard. In crypto the streets run red and it hurts. 50% losses, 75% losses, even 90% losses can happen. The news that was euphotic and and on top of the world suddenly proclaims "Bitcoin is dead" and the community that was sharing memes of Lambos and moons will suddenly get all quiet and sullen.

Just realize, Bitcoin is not dead, the news claimed it has died over 300 times and every time it got up again. Same goes for Bitcoin Cash or any other Coin out there. If you do listen to market talk, only use it to gauge when might be a good time to pick up some more of your favorite coin or token. I say this because the FUD will be very strong during a crash and most people will talk negatively during a down market.

6: If you're ever in doubt about anything, zoom out. What looks horrible is just a tiny little dip in the grand scheme of things. Can you even still see the huge market crash from 2017? What about the ones that happened before for the coins which existed before 2017? Those crashes were horrible I've been told, yet on the big chart they're not even visible anymore....

7: Change your views. It's not about how many dollars are in your portfolio but how much of your favorite token or currency. If you look it's the same amount of BCH, ETH, LINK, ADA whatever that's sitting in your wallet; only the dollars are changing and decreasing during a crash.

8: Earn more Crypto: In a few places a market crash is a great opportunity to earn more Crypto. Staking rewards remain the same but will be worth more down the road, places like Noise Cash and Read Cash are still just as awesome. Even Coinbase Earn will get you more crypto if you watch their earn videos during a market crash.

9: If all else fails, walk away for a few weeks or months. Close the market app. Back up your seed phrase to your wallet. Mute Crypto Hashtags on social media. Spend some time with your family, pursue a hobby or learn something new. Crypto will still be there in a few months and your sanity may be grateful if you're not subjected to the market swings every hour of every day. I have a friend that absolutely has to walk away for a few weeks when the markets get too crazy and I don't blame him. Not everyone can stomach the growing pains of a new economic revolution.

Hope these tips help you during the next market crash. When you come out the other side of it you'll be like the rest of us, master HODLER extraordinaire. See you on the flip side during the next Bullrun :).

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Avatar for TheEmpress
3 years ago

Comments

Don't get overzealous at the first sign of recovery, it may not be a full recovery. Also don't think that a dip is the last dip. Be very careful trading in these times as it's easy to mess things up - that recovery may be a false one and if you sell you may find out missing a bigger recovery later, the dip you're buying may not be the deepest one and you may lose a little more money before the market finally recovers for real. Leave the see - saw weeks to the pros, as it can go up and down like a pendulum. If you buy then buy to hold long term. If you sell be sure you're happy with the price you sold for. This particular fundamentals got me thinking of some of the mistakes have made and the losses I've encountered in the past few months since getting to know a little side of cryptocurrencies in late 2020. But with this article, I think I can now know how to strategize my portfolio and decide on how strong I'll stick to the hodl even during the red days! A very big applaud to the author and to the referrer @Porwest from noise.cash, thanks a lot ๐Ÿ™๐Ÿพ

$ 0.00
2 years ago

Thank you for reading :). It's hardest to stick to HODLing on the red days for most of us, but with practice it gets easier to have iron hands. Feel free to always check back on this article or share when others are going through a rough time in the market.

$ 0.00
2 years ago

One of the best pieces I have seen written on this in a while. Excellent advice and valuable perspective. Thanks for it.

$ 0.00
2 years ago

I'm glad that it's helping you and I appreciate the compliments. Personal experience is the best teacher. I figured it was very relevant to share again given how the market has been lately. Feel free to always let people find this article when they're newbies encountering their first red market free fall.

$ 0.03
2 years ago

Indeed. I was happy to share it on my profile a few days ago, and hope many people were able to find their way to it.

$ 0.00
2 years ago

This will help me as a newbie in the cryptoverse, thank you for this and I happened to stumble upon browsing on noise.cash and it leads me here haha, it was a good decision by clicking the link๐Ÿ’œ๐ŸŒผ

$ 0.00
3 years ago

It is a step by step process. Learn from the mistakes, because we all make some. And the most important thing is to switch out our emotions!

$ 0.00
3 years ago

That's good advice. Nobody knows what's next. If there is a massive spread of communism in the world, it will decline even more and the governments of such countries will block it. We'll see what happens next.

$ 0.00
3 years ago

You've highlighted some very important options to tackle market fall, so as not to deal with our emotions. I've handpicked some of these too before now, thanks for reminding of them again. Hope to see more of your write ups

$ 0.00
3 years ago