Most savvy investors will always strive for a diversified portfolio across assets to smooth out gaps in the market and allow for lasting gains while mitigating losses in a tumultuous market. However, with inflation recent to record highs and the arrival of Crypt o winterit’s more important than ever to have a mix of altcoins, startup projects, and big players in your portfolio.
Your risk tolerance Individual will dictate what the asset allocation will be, with those seeking higher returns being split more between seed and alternative projects. While those who are more risk averse are likely to turn to BitcoinEthereum, and your other largest market cap coins for a smaller, but more likely gain.
Nevertheless, given the state of the market, it is more important than ever to not spread too thin and to protect yourself when exiting institutions, to cover yourself against margin calls and to avoid the liquidation of assets. As an investor, you should welcome this winter as a chance to stock up on discount coins, but be diligent about your holdings and always do your research.
How Long Can This Crypto Winter Last?
The question many will ask is how long can we expect this crypto winter hard? While no one can be sure, as crypto moves fast, is fluid and open 24/7, macro indicators are grim and you should be prepared for this winter to last a while, with some reasons why.
The reverse repo market has long been consistently inflated with record highs in May and June. When abnormally high figures are observed in reverse reposthis demonstrates a key indicator that there is no confidence in the stock market and that institutions do not trust any potential investment, but take the 0.8% risk-free guarantee to place the funds with the Fed.
Additionally, many mortgage-backed securities ETFs are plummeting, with Vanguard’s secured mortgage-backed securities ETF falling almost 10% after hours yesterday. When there is no institutional trust and the housing brand is on the verge of collapse, it is a clear economic indicator that a downturn is upon us.
Average dollar cost reduction
While this may all sound bleak, fear not, because for retail investors this is an opportunity to lower the average cost of your investments or enter the market at a very attractive price and a lot more palatable. With crypto adoption continuing to flourish, many DeFi and Metaverse protocols are pushing paradigm-shifting technology, and the opening of Web 3.0, crypto is nowhere.
It is imperative that even though your wallet probably looks a little red and green days look like gold dust, you should cheer for the short-term market downturn so that you can store your favorite coins and tokens for put you in a better financial position down the line.
How many times have you heard someone say “I would like to invest in Bitcoin in 2017” well take this as your chance and don’t miss it.
A unicorn to help you diversify your portfolio
Investing in early-stage coins and protocols and diversifying your portfolio gives you the opportunity to participate in high-potential projects while minimizing risk. This is why a project such as Logarithmic Finance (LOG) is very exciting and could revolutionize the way pre-sales investing is done.
LOG, which is currently in its own pre-sale, is a next-generation layer 3 protocol aimed at solving the problem of investing in early-stage companies through their native token, LOG. They will do this by bridging the gap on its consolidated platform, allowing you to buy pre-IDO/ICO coins on any blockchain network with its cross-chain compatibility.
LOG has other features that help unlock the world of DeFi, with better swap ratios, discounts with certain partnered coins, and has strong tokenomics to make LOG an even more attractive investment.
LOG has a maximum supply of 4 billion tokens, with 1.2 billion tokens included in its presale. The token is also a community-driven deflationary asset, allowing long-term holders to have sustained gains and vote on the burn percentage of network staking rewards. Finally, once alive, no single entity will manage the ecosystem on its own, it will be governed by its community which, in the world of DeFi, is essential to gain the confidence of investors.
Although still early, LOG seems like a good option to include in your portfolio, but this will of course depend on your risk tolerance. If you want to know more, you can check out their website and Litepaper.
Log Finance (LOG)
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A diversified portfolio is the best way to take advantage of the crypto winter
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