Ouch. XTZ is trading below $3 for the first time since 2/12. What gives?
By now, everyone here probably knows what a Tezos bull I am. Unfortunately, I'm having to rethink a few things - as are many of us, I'm sure. Friday was a rough day for crypto as news of the federal government's intention to regulate the markets first broke. I'll avoid the details, as they are few and far between and I don't know yet whether to be bullish still or to become a bear. Maybe someone has insight they'll share in a comment that will help me make up my mind, but as of this post, there are many questions still unanswered. I'll have a look at four or five crypto tokens I've been following to see how they're weathering the storm, then offer up a quick glance at the way I've decided to deal with it.
First, Tezos itself.
The token that doubles as a security is in murky waters, and it seems possible that the price could rise or fall with equal probability today. I've set a few shares to sell at $3.50 and a few dollars to buy at $2.50 because I just have no clue what will happen. Volume seems fairly low, so volatility is likely to be high as we start to see things pick up (if they do, as it's President's Day here in the United States). If you're just waking up and you're shocked to see how low things have dipped, the good news is that this is equally likely to be a short-term setback and a long-term indication of price decline.
Second, my long-time Tezos hedge and co-indicator: Ethereum.
Ethereum is not a security and it does not (in my very non-professional opinion) hold the same level of long-term potential, assuming a few things go right for XTZ and use picks up and the company is successful in executing its long-term vision. That said, Ethereum is a mainstay of the crypto universe at the moment due precisely to its widespread adoption. There are many who claim it will eventually supplant the current king, the original Bitcoin, as the dominant form of cryptocurrency in the market. Ethereum is down about 6% at the time of writing to Tezos's 7.5%, and is holding up better than anything else in my portfolio. This can be attributed to the larger market cap, which is again a direct result of the fact that loads of people use it as online money.
The reigning champ has weathered the past 24 hours with only a 2.5% dip in price. Frankly, if you're looking to make a safe bet in terms of resiliency to sell-off and yet remain open to the potential for growth, it seems fairly clear that you'll be in good company ducking into BTC for a little while as we wait to see what things look like when the dust has settled.
Fourth, Basic Attention Token.
The Brave Browser's token has been hit harder than even Tezos by the recent sell-off, down almost 12% over 24 hours at the time of writing. BAT's key bullish indicator is the rapidly growing adoption by sites such as Publish0x as well as YouTube, Twitch, and Twitter, which all currently utilize BAT to make creator-tipping possible. Additionally, BAT is going to be buoyed in the short term by the attention Brave's unique advertising strategy is getting from the likes of Amazon and Walmart.
Fifth, let's have a quick glance at a dark horse: Ternio.
Near the floor during the sell-off, as BlockCard adoption has been slow and volume is next to zero, TERN has held remarkably stead in the $.007 range throughout the sell-off. If the token remains stable or begins to climb, it could make for some very rapid growth as all the investors with $100 in begin using their BlockCards to spend their (presumably unstable) gains. If you want to roll the dice, it costs about $110 to get up and running and is a HIGH RISK INVESTMENT. If TERN eventually stabilizes in price, however, this coin could become very valuable as trade volume tied to daily purchases is bound to be high for some time to come. Find out how to get involved here.
It is too early to say much without risk of being very wrong, but we're not likely to be looking at a long-term selloff. It seems more likely that investors are exercising perhaps a bit more caution than is necessary, having learned the hard lessons of the 2017 spike.
During the bull run, I developed a strategy of pulling from XTZ when price peaked, immediately buying BAT and waiting til the curve looked about the same as the XTZ curve, and then transferring to ETH to wait until things calmed down a bit. It wasn't perfect by any means, and my execution was no better than a first-timer is likely to manage, but I'm certainly very interested to hear if anyone else has conducted an experiment like this using the different crypto tokens to hedge each other. The goal of investing is to manage risk while maximizing return, and though this is a delicate balancing act, it is likely that the market will become more consistent as more people learn to keep up with the high-stakes world of cryptocurrency exchanges. BTC's continued stability seems to be a very hopeful sign.
My final thought for you today is that there's a sort of beauty to the present situation, in which almost anything seems capable of happening next. I find myself enjoying the ride, and I hope you do too.
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