If you are like the majority of investors who bought Ether on the "dips", you might be asking yourself what to do now that it's at $530 as of (9pm EST on Mar 17th). The answer may be a little simpler than you think and for those who have Ethers average below $770, you may even end up gaining some money in the process as well.
The Big Idea
Find an ICO that has their conversion rate locked at equivalent of $700 such as Coinvest. They must also have a target rate of the token when hitting an exchange in USD ($0.70 for Coinvest).
This idea makes the most sense if you think the market will be in a slump for longer than a few months. Otherwise, you probably can just wait it out if you have the luxury to do so.
The Steps
Here're what you can potentially do:
- Find a good ICO with potential and fits the criteria above. You may want to choose one that has smaller discount/bonus as well so that the price will be more stable when they hit the exchange since people won't dump if they only have a slight gain.
- Participate in the ICO and receive the tokens.
- Wait until the tokens hit the exchange. At this point, most companies may choose to list later depending on the market. You would actually want them to list when Ether is about $770 or lower, but it's also okay if it's higher because that also means the market has recovered and you will be making some gain on token itself.
- Sell back to Ether if the token is listed at the exchange when Ether is below $770 or alternatively hold on to the token for a larger gain.
The Math
Let's say you bought Ether at $770. If you sell now at the current price of $530, you would have lost $240 and you will most likely cry inside a little. That's a whopping 31% loss!
Instead of that, participate in an ICO which has a locked rate. Let's use Coinvest as an example. They have Ether locked at $700 and you will receive 1100 COIN (10% bonus included) with total value of $770.
So instead of losing $240, you are now breaking even!
Coinvest is supposed to be listed on exchanges in April. At that point, there are a few potential scenarios on how you can cash out:
ETH price stays below $770. Let's say it stays at $530 by April. At that point, you can sell 1100 COIN at $0.70 and get back
1.4528301887 ETH. That's 45% gain instead of the 31% loss.ETH price is at $770 by April. At that point, you can sell 1100 COIN at $0.70 and get back
1 ETH. You break even instead of losing 31%.ETH price is higher than $770 by April. That probably also means that market has recovered. This is when you have to decide whether ETH or COIN has better potential and if you decide it's ETH, you may sell and lose a little bit depending on the price of ETH at that point. It's also possible that COIN does really well from first day and you will end up with a gain when you convert it back to ETH.
Am I Eligible for This?
This largely depends on where you live and whether you are accredited. If you are a non-accredited US investor, you may be out of luck. There are a few ICOs that allow non-accredited investors to participate through SAFT, but at this point, I'm not aware of one that has a fixed conversion to Ether (or other coins).
Although this article is using Ether as an example, it's also possible to use the same steps for other coins if they have the rate lock to those coins (Bitcoin, Litcoin, Dash, etc).
The Big Lesson
Do not freak out and sell without looking into all possible options. There might be an alternative somewhere if you look hard enough. Invest with your head instead of emotion. This doesn't only happen in the crypto world, but also in stock market as well.
Legal Disclaimer: I am not a financial advisor nor is any content in this article presented as financial advice. The information provided in this blog post and any other posts that I make and any accompanying material is for informational purposes only. It should not be considered financial or investment advice of any kind. One should consult with a financial or investment professional to determine what may be best for your individual needs.