Smart investors are quietly doing this to prepare for the next Bitcoin and Ethereum super cycle
Bitcoin and Ethereum suffered an unprecedented blow in 2021.
Prices rose sharply earlier this year, followed by a sell-off by Elon, some people say he did it to entertain billionaires. The cryptocurrency market led by Bitcoin and Ethereum is slowly rebuilding. Prices and a solid foundation for new users to join these two networks are taking shape.
If the network effects of these two cryptocurrencies continue as public data shows, then a new super cycle is coming. NFT games are helping to change the paradigm of this industry, which is considered to be years away from the influence of blockchain, which is already reshaping finance, social media/news and collectibles.
Axie Infinity is currently the most popular blockchain game project. It’s like a Pokemon game, but it’s better, except this time it has its own economy and creates real-world jobs for mankind.
I am very excited. This is a repeat of 1996-when the Internet changed everything, forcing my dad’s fax machine to be thrown into the trash can.
Since inflation rates in many countries far exceed the 2% promised by the government, alternative investments must be made in order to maintain purchasing power and protect the time you give up to make money. Bitcoin and Ethereum are becoming part of the investment portfolios of ordinary people, hedge funds, retirement funds, and even large corporations.
Here is how to prepare for the next super cycle of cryptocurrencies led by Bitcoin and Ethereum.
To understand the history can we understand the bright future
Learn about the history behind Bitcoin and Ethereum so you can understand where things are going. The Bitcoin Standard is a must-read book. It explains many of the key concepts needed for the next cycle.
I have seen many people who are critical of cryptocurrencies. They obviously don’t know what they’re talking about because they don’t understand why Bitcoin exists.
Bitcoin was born after the economic recession in 2008 to solve the problem of the government creating huge amounts of funds out of thin air and providing them to the rich. Then the rich invested it back in the stock market and pushed up the price (using the current stock market price as certificate).
Ethereum was created to turn the blockchain into a decentralized bottom layer to strengthen trust. It was initially realized through smart contracts. Ethereum now has hundreds of use cases and has replaced most of the Internet, including the “cloud.”
The large technology companies that have led the development of the Internet in the past 20 years have become greedy. They use our data for their own benefit. The user (United States) no longer owns the Internet. The company and people may be completely shut down by a guy wearing a brother’s t-shirt working for a tech giant (or Zucks).
Ethereum provides a democratic layer of trust, and consensus must be reached before major changes can be achieved. Every blockchain has its own rules. You can move from one place to another according to your needs and beliefs.
You can’t use large technology companies to vote for your rights because they don’t allow you to keep your data. They decide your destiny, it depends on their security law, not the real law we voted for.
Ethereum brings democracy back to the Internet.
Long-term, serious review of smaller projects
Bitcoin and Ethereum will lead the next super cycle. Why? They have the most usage, attract the most number of users, the highest price, and are adopted by well-known giants such as PayPal and Visa.
They are not the only two cryptocurrencies that will achieve great success. The tide goes up. Smaller blockchain projects will also perform well. In fact, based on the last super cycle, smaller projects may surpass Bitcoin and Ethereum. The problem is risk. There is nothing easy to make money in the world.
What I am going to do is to make small investments in small projects. My criteria are as follows:
- What problem did this project solve?
- Who is on the team?
- Who are the investors involved?
- How many customers do they have so far?
- Is this technology useful?
- What do their users say?
- Can they be easily replicated by a better, faster, and more attractive project?
- Well-known exchanges Coinbase, Crypto dot com, and Gemini sell their cryptocurrencies, or are they only those well-known suspicious platforms?
Once I have a final candidate list of 10-20 projects, I will invest $1,000 or less in each project.
In the last super cycle, the prices of many small projects have risen 10 times to 100 times. Diversification, risk management, and small investments are the keys to using this approach. However, if you have not invested in Bitcoin and Ethereum, you may want to look at them first, and then consider projects with greater risk and less chance of success.
Save some cash
Cash is rubbish, yes. But cash allows you to invest at a discounted price.
Compared with the prices of mainstream cryptocurrencies a few months ago, there are still many cheap cryptocurrencies. If you want, saving money in preparation for the next super cycle will help you get involved in the action. Otherwise, you end up like many investors: borrow money to buy Bitcoin and Ethereum.
There are already risks in investing in cryptocurrencies. Borrowing money to invest in cryptocurrency is like throwing $100 on the roulette table and walking away. Debt will cost you money you don’t have. If the price suddenly drops again because Elon (or another influential person) makes the price plummet, you may need to pay for it.
Stay away from debt, which is leverage. Use savings to invest.
Decide how much risk you are willing to take
Some of us are more willing to take more risks than others.
For example, when the prices of Bitcoin and Ethereum dropped more than 50% many times, I didn’t even blink. This is because my risk tolerance has adapted to the crypto market. Without huge volatility, you can’t get 200% annual returns on investments like Bitcoin or Ethereum.
Volatility equals growth.
My risk tolerance is still lower than most people. I know some people invest all their money in cryptocurrencies. I will never go too far, because this is not part of my investment principles.
In order to prepare for the next cryptocurrency super cycle, you must decide whether you are willing to take risks. The following questions can guide you:
- How much can I invest without being stupid or taking all risks?
- If there is a black swan event and the price plummets, how much can I afford to lose?
- If I lose the digital wallet that stores all the cryptocurrencies, how much can I afford to lose?
There are solid rules for risk. Whatever you do, don’t break them. Otherwise, you may change from an educated investor to a complete gambler.
Research future trends
Raoul Pal, former Goldman Sachs investment banker and CEO of Real Vision, a popular financial education provider, believes that community tokens will be the next trend in blockchain. This is where companies create their own tokens, just like Diem, the cryptocurrency project Facebook is working on.
There are also trends like aggregators. Spotify music aggregation. Youtube aggregates videos recorded by users. TikTok gathers people to dance to music. Apple aggregates where we buy apps. Amazon aggregates books.
The first decent blockchain aggregator is in the game field. Yield Games Guild (YGG) is working on integrating NFT games.
There is also the trend of decentralized social media. Now, we still mainly use traditional platforms such as Facebook and Instagram to connect with friends and keep in touch.
What will replace Zucks?
This is a question worth studying. Research can help you understand what to invest in in the next super cycle, and which platforms to join, so you can replace bad centralized Web 2.0 applications.
Let’s replace Zucks.
Here are some killer resources that can help you with your research:
- Exponential age
- The value of technology is driven by network effects
- Ark Investment Research Center
Choose news media wisely
Many news channels about Bitcoin and Ethereum are biased.
Why? They try to raise and sell prices to support their investment. We even have some news channels that promote cryptocurrency on a paid basis. This kind of behavior has existed on Wall Street for many years, and now it also appears in the field of cryptocurrency.
I get encrypted messages from Twitter celebrities such as Ivan On Tech, Michael Saylor and Winklevoss Twins, and BitBoy crypto on Youtube.
Explore the options and choose your news source. Click the bait carefully. Check the owners of the news channel to see if they have any hidden biases. Look for well-intentioned behavior. For example, Ben Armstrong of BitBoy Crypto reduced a loan he lent to a friend who unexpectedly turned from an investor into a gambler.
Dare to take an encryption course
This is my next super cycle list. Blockchain and cryptocurrency have many complicated concepts that you need to understand-income farming, pledge, Eth 2.0, proof of work, etc.
Investing in Web 3.0 education is your opportunity to take advantage of the next wave of the Internet.
Strange things you can do before the next super cycle
Many people don’t know that you can really find a web3.0 job. For example, Moralis is hiring a large number of people to build the future of technology. Pomp Crypto Job Board is another place where you can find web3.0 jobs.
Compared to those who waited until the end of the super cycle to finally join in adoption, using Web 3.0 every day will give you an economic advantage. Those who continue to say that cryptocurrency is a scam will support themselves, just as critics of electricity and grandpas who refuse to give up fax machines and use email do.
As part of your daily work, you can get paid for learning Web 3.0 for free to prepare for the next super cycle.
I can’t wait for the next super cycle of Bitcoin and Ethereum.
Owning our data, having a democratic say in the technology we use, freedom of speech, and making money that cannot be made out of thin air are all issues that society needs to solve to continue to prosper.
The Web 3.0 revolution led by Bitcoin and Ethereum will change the Internet as we know it. Based on your research and risk tolerance, start preparing by opening your heart to a world full of possibilities and making some small investments on the blockchain.
If you don’t know anything about blockchain, start with more secure options: Bitcoin and Ethereum. History shows that if you do this, you will be on the right side of the revolution.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/smart-investors-are-quietly-doing-this-to-prepare-for-the-next-bitcoin-and-ethereum-super-cycle/
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