Cryptocurrency especially the wider altcoin market is a casino, no doubt about it, for all the progress made in the technology no one has really had a widespread product-market fit, and they're all building and speculating on who will be the first to find the shiny key that unlocks the future.
Until then, all alts are merely speculative vehicles and call options on future adoption of blockchain in certain markets and applications. Long term I am bullish on the application, but I am by no means tied to any project or brand thinking they will be the outright winner.
2020 has been one of the craziest years that those who alive over the last 7 decades or more has seen before. We're all desperately trying to cling on to the old way of doing things and have not accepted that things have changed and we're moving in a new direction.
As economic pain drives crime and uncertainty, as the US elections polarise people, as populism rises up and people are trying to find shelter in group dynamics and identity politics, it's all also manifesting in crypto.
Reducing the risk
People invest in alts because they want to go further out the risk curve for the promise of greater rewards, they buy up a larger portion of the supply and hope to sell it into stronger future demand. Some people are impatient or feel that now is not the time to be spreading their capital so thin.
We're seeing people start to consolidate in Bitcoin and even as Bitcoin moves up, alts are losing value, many alts in fact. This to me are people deleveraging, and they would rather get into Bitcoin where the moves are "relatively" less violent, and the brand has become a trusted floor for the entire crypto industry.
If no big changes are made the world economy, and it remains on its current trajectory then Bitcoin will d very well, people are banking on that, or they also simply wanting to get out of fiat or hedge their bets by owning some. Regardless of the motivations, people are trying to reduce their risk by getting into Bitcoin.
Staying liquid
As jobs dry up, as lockdowns continue, as more peoples debts pile up, as they have less access to capital, altcoins will take a tanking. People want to be liquid; they will dump their most speculative assets. First, they need cash or rather feel they need cash, they would rather hold on to this extremely liquid asset and wait before deploying it once they know what their economic situation will be in the next few months.
We're at the edge or rather already falling into the insolvency crisis, and people need cash. The thing with crypto is that its a 24-hour market, and it trades all over the world, were exposed to so many countries and their economic situation and because of this the market takes the hits based on what's going on in various parts of the world.
I've been looking at several alts, and people are literally ready to dump at any price, buy orders are starting to consolidate at extremely low floors as those willing to take the risk are not going to spend a lot to take it off their hands.
It really is a bloody time for alt coins. I've never shy'd away from it, I always say if an alt is to survive at the moment, it's not about the tech, it's about how much confidence the community has in the project, this remains to be seen for many, and I think this could kill off a few more undeserving projects with market caps we don't even know how they managed it.
There is a lot of duplication that doesn't provide real competition and its a project for the sake of the project.
Nothing to lose
I've taken this time to review the market and pick out a few alts that have been hammered of late and put in buy orders that I'll be surprised to see if it gets filled. As these alts continue to tank a simple 50 dollar investment can net you a massive stake of a shit coin. So I've picked out a few coins, most of them are staking coins, others are coins I've had and want to average down the cost.
I feel at this point I have not much to lose, even if it goes lower, I am by no means putting in massive amounts of money into projects, I just think that taking advantage of the market feeling like they're afraid of risk or wanting to be liquid at a time like this is a great way to net you some decent returns for a small fee.
Maybe I am loco, but I've always tried to do the opposite of what the market does, if they fearful, buy, if they are bullish, sell.
Have your say
What do you good people of HIVE think?
So have at it my Jessies! If you don't have something to comment, comment "I am a Jessie."
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