I'm watching the crypto market as a whole run the range lows (approx. $30k) again, wiping out all of the gains from the earlier part of the week. We've been through this like 6 times now since the 60% BTC drop from its $64k high. If you've been following my blog, you know that I've been warning we may have another push down. Nothing is set in stone, but there is no reason to believe BTC won't hit $25k before it starts another sustained bullish pattern. We could hit $19k-20k. This is not out of the question and you must be prepared for this, especially if you're playing around with shitcoins.
Altcoins as a whole had a little fake ass run up in anticipation of a BTC move up. Well, we didn't get that, so defi is falling back down with ETH and BTC. But DAOs and blockchain games ran up more and really stood out. They may fall back with the market in total, but they ran up so much that they are now on a new high compared with the rest of the market.
What I mean by that: My land in Axie Infinity is worth more now than it was when BTC was at $64k regardless of denomination (fiat, BTC or ETH).
The two investments that really stood out in my portfolio were Axie Infinity and Olympus DAO. And to be clear, I'm not talking about lucky meme coin wins. Those happen all the time and are based on luck and timing. I've been holding Axie and Olympus for months now. I'm only talking about projects that actually have a legitimate, sustainable core value and concept.
Here's why I think this happened:
We're not in the era of shitcoins and garbage ICOs any more. All of the idiots want to equate the BSC Scam Era with 2017, and it's just not the same. Only noobs are getting wiped out by the garbage on BSC. Everyone was taking Ls in 2017 because there were no launchpads or other standard bearers in crypto.
I say that to say this: There are now levels to altcoins — not everything is as correlated with BTC as it was before, at least not in a dove market. (If BTC falls back into the $20ks, correlation will increase.) There are also clear winners in certain sectors of crypto. In the blockchain gaming/play-to-earn sector of crypto, Axie Infinity is the clear winner. It's not even close. All of the other garbage I've played or invested in — Alien Worlds, Revomon, Crazy Defense Heroes, My Neighbor Alice, Embersword, many others — either play like shit or had shit launches. (Defi Pet is the one new game I'm holding out hope for.)
People are also taking DAOs more seriously. The DAO is the most sophisticated concept in crypto and the one that requires the most time and knowledge. Decentralized governance is a tricky thing, because you're dealing with culture as well as math. For instance, I'd never go back into Lift Kitchen again regardless of how profitable they became. Their devs have shown themselves to be selfish narcissists, and their communities are at best sophomoric lemmings. I don't want to make money with them. Every DAO deals with this, so any DAO that puts together a decent community around a shared vision is to be commended.
Regardless of the difficulty, clear winners are beginning to show themselves in the DAO space as well. Olympus is one of those. The concepts they base their expansion on are not easy to understand. From my perspective, they are winning because they have the ability to stick to a plan. This is relative, because they still do some things that cause investors undue monetary loss. Other DAOs like Lift Kitchen make mistakes and cost their investors hundreds in capital losses and fees to unstake, move shit and run around in circles. Garbage. Olympus kept their APYs high to keep people enthusiastic while they worked out their own bullshit. They are now partnered with Rari to offer one of the best lend/borrow pools on all of Ethereum.
Axie serves as a remittance vehicle for the Philippines that is restructuring entire neighborhoods. Regardless of how bitcoin or ether are doing, those SLPs are feeding real people in a place where government isn't able to provide a real safety net. So even now as the pandemic is subsiding (I expect another surge this winter!), families have learned to depend on Axie. This is legitimate, real world value that is not easily lost.
Both Axie and Olympus have clear utility that is fully independent of bitcoin's core value proposition. There are other risks to both, including technical risk of servers being shut down for political reasons and dependence issues (like how dependent is Olympus on Infura). These are issues bitcoin doesn't have, so bitcoin is still the safer project. But all else equal, i.e. everything running like it's supposed to — projects like Axie and Olympus now have the freedom to uncorrelate themselves from bitcoin. And if they also differentiate themselves from their sector competition, well then you've got a legitimately independent, mature investment that you can begin to value on its own merit.
Bottom line: Don't get caught up in the PTSD of 2017 losers. Even if you're not a trader, there are now projects that you can legitimately hold through bull and bear markets to actually participate in the project and not just price action. Look for the stuff that has survived and continued to build regardless of the pullback. Barring technical or political risk, these are your 100x winners this cycle.
Bear/dove markets also show you the dev teams that are only in it for the money. If they stop developing during a down or sideways market, which is the best time to develop, you know to stay away from that shit even if it pumps during a bull market.
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