Summary

The website content suggests that the current crypto market downturn presents a strategic buying opportunity for investors, with a particular focus on timing the market for Bitcoin and understanding the unique investment strategies for alt coins.

Abstract

The author of the web content expresses a positive outlook on the current crypto market dip, likening it to historical patterns where buying during lows has proven beneficial. The article emphasizes that Bitcoin, as the market leader, has experienced significant drops in the past and recovered, suggesting that its current low price could be a good entry point for investors. The author also discusses the importance of diversification within a crypto portfolio, noting the higher volatility of alt coins compared to Bitcoin and the need to research and believe in the projects one invests in. The recent collapse of Terra's LUNA serves as a cautionary tale against putting all funds into a single asset and the risks associated with stablecoins and their underlying algorithms. The author's investment strategy involves buying Bitcoin when it nears its projected bottom, followed by Ethereum and other alt coins once the market shows signs of recovery, to maximize potential returns.

Opinions

The author believes that the next few months will be an opportune time to buy Bitcoin, predicting it could hit close to $13,000, and potentially rise significantly by 2025.
They advocate for a strategic approach to alt coin investing, focusing on the project's value rather than timing the market, due to the higher volatility of alt coins.
The author advises against investing in Terra's LUNA, despite its significant drop in value, due to ongoing issues with its stablecoin UST and the resulting hyperinflation of LUNA tokens.
Diversification is key, according to the author, to mitigate the risk of total loss in the highly volatile crypto market, akin to investing in the burgeoning internet companies in the late 1990s.
The author suggests that alt coins typically lag behind Bitcoin's market movements, reaching their lowest prices a few months after Bitcoin's dip and peaking a few weeks after Bitcoin's recovery begins.
They emphasize the importance of having a clear investment strategy and warn that one should only invest money they are willing to lose, echoing the sentiment that bear markets are where the most money can be made, even if it's not immediately apparent.

Crypto is crashing — This is your opportunity to buy in

Everyone in the crypto community is panicking this week. Bitcoin hit its lowest price since December 2020. Here’s my take on the current state and why the next few months will be a great time to buy.

**Obviously, this is not financial advice**

Bitcoin, the market mover

Bitcoin was the first ever cryptocurrency, enabled by blockchain technology. The chart below shows how Bitcoin’s price has changed over the past 10 years.

A History of Bitcoin

Here are my key takeaways from the chart above:

In the beginning it was worth dollars.
It almost hit $1,000 in the 2013 bull market.
Then it dropped to $200 in the 2015 bear market.
It hit $18,000 in the 2017 bull market.
It dropped to $3,200 in the 2018 bear market.
It hit $67,000 in the 2021 bull market.

Today, Bitcoin is worth $29,500, down about 56% from its all-time-high.

The price still seems to be trending downward for now. Of course, the top cryptocurrency doesn’t seem to be slowing down in the long-term.

I find it interesting that BTC has lost roughly 80% of its value during each bear market following its latest all-time-high.

This makes me think we‘re not yet at the bottom of the Bitcoin price.

My Bitcoin Investment Strategy

If Bitcoin continues the trend and loses 80% from its all-time-high, we’re looking at hitting close to $13,000 in the next few months.

Timing the market and buying Bitcoin close to this level will maximize the return on your investment.

Again, this is not financial advice.

I will personally be buying Bitcoin again when we get close to the $13K range. Then, there’s a real opportunity for Bitcoin to 20x to $250K and beyond by 2025.

Bitcoin seems like a relatively stable investment. That’s why it’s key to time the market, buy low and sell high.

However, there’s a whole range of alternative cryptocurrencies that offer a slightly different strategy.

Ethereum & The Rise of the Alt Coins

Ethereum was the first alt coin, inspired by Bitcoin’s blockchain technology. It expanded on Bitcoin’s offering with smart contracts.

In simple terms, this means that developers can build secure apps on top of the Ethereum blockchain.

Since its founding in 2015, Ethereum’s price has now begun to follow similar trends to Bitcoin. Other alt coins, however, follow their own trend.

Alt Coin Investment Strategy

My key to alt coin investing is that it’s more important what you’re buying and less important when you buy and sell.

That’s because alt coins are significantly more volatile than Bitcoin.

One project I invested in back in 2018 lost 90% of its value before shooting up to 40x my initial investment.

If I had invested in this project at its lowest point, my return would have been 400x, but I’m still happy with my 40x return!

It’s important to research new alt coins before investing. You want to understand how they fit into the wider crypto market.

There are so many alt coins that are worth considering. If you’re a crypto newbie, it’s probably not a good idea to put all your money into one basket.

The Risk of Not Diversifying Your Crypto Portfolio

Crypto investing is an incredibly risky game. Anyone who tells you otherwise is lying. You should only put in money you’re willing to lose.

It’s similar to investing in websites in the late 1990’s. Any one of these companies could go bust any day now. But they could also be the next Apple or Amazon.

It’s a good idea to invest in projects you believe in. But you also need to diversify your portfolio. You don’t want to lose all your money in one crypto project.

The Fall of Terra LUNA

This week saw the collapse of one of the top 10 crypto projects: Terra’s LUNA.

LUNA seemed like one of the most promising new cryptocurrencies of this bull market, starting at mere pennies in 2020 and topping out at over $100 in March 2022.

Without going into too much detail about the issue, LUNA’s price dropped due to an issue with its algorithm.

Terra’s stablecoin UST (pegged to the US Dollar) became unstable and unpegged from the US Dollar.

The algorithm aimed to keep UST secure by selling LUNA to secure the peg. Unfortunately, the Terra team didn’t expect the market movements during this crypto crash.

As a result, the algorithm printed new tokens to be able to secure the UST peg. LUNA is now the product of hyper-inflation.

If you owned LUNA before the crash, it lost virtually all of its value (as of May 15, 2022).

To clarify, I still wouldn’t buy any LUNA!

I don’t care if it’s lost 100% of its value, it can still drop further. I’ll reconsider when UST regains its peg, but that still doesn’t seem to be happening.

Timing Different Investments

Another key takeaway I’ve learned from the past few years is that Bitcoin moves the crypto market.

This means that alt coins tend to lag behind Bitcoin’s price. They tend to reach their lowest price a few months after Bitcoin and their highest a few weeks later.

How this feeds into my strategy is that I’ll first buy BTC and ETH in the next few months. Once BTC and ETH are clearly on their way up, I’ll shift my focus toward alt coins.

This is when I expect alt coins to reach their most attractive purchase price.

It also helps give me a few months to save up for my alt coin buying spree!

That’s just my take!

I think we’re entering a new stage of attractive investment opportunities.

The crypto crash is giving you the opportunity to buy crypto currencies for pennies on the dollar.

As long as you don’t bet more than you’re willing to lose, this is a great opportunity to increase your returns.

It always helps to have a strategy in mind. And like they say:

You make most of your money in a bear market; you just don’t realize it at the time.

Again, this is not financial advice. It’s just my personal strategy.