We have entered a new year and there is still so much uncertainty and anxiety about the future of crypto. Some major factors include the FTX crisis and the consequent fallout which is expected to hit a lot more exchanges, projects and companies. Other factors include the economic recession looming and the economic implications from the Ukraine-Russia Conflict.
The uncertainty round the globe has already prompted actions by regulators in the traditional space to try and maintain stability with varied results. Crypto on the other hand has been largely scarred and most investors have become very sentimental and cautious. Everyone is on a watch and wait situation and there is very little noteworthy action taking place in the market.
The forecasts aren't very good. Those who have managed to give it talk about the need to brace up for a tougher 2023 before we can hope for some form of relief. This is if there are no further unexpected, external damages to the space. Yet this assumption failed so miserably in 2022 that perhaps the most logical step as an investor would be to imagine the worst case scenarios and likely plan ahead.
Imagine for instance if another major exchange is affected by this crash, or some major projects take a hit that put the space on yet another downward spiral. Where would we be as investors and what would we feel. Is it so farfetched to imagine that another major incident that hurts the space will occur? For me it isn't. The space right now is moving away from shock gradually and trying to figure things out, yet There might just be more shocks on the way.
If they do come though and we hit rock bottom, what next? What we see now is stakeholders trying to take action by attempting to shore up confidence in the markets through their actions like asset declarations or pumping liquidity into the system. No-one wants a situation where we hit rock bottom on an investor confidence level, but is such a situation necessary for our future?
If we hit rock bottom we'd have to really go the extra mile with proof of value in order to rebuild and ascend. It might mean that everything the space needs for the next line of evolutionary growth is finally provided and utilized. Of course it would also mean that a lot of investors will lose their funds, some permanently depending on the outcome of fated projects, but it would force the space to emerge.
Conclusion
The quicker everything falls apart, the faster we can emerge from the ashes. If that is not to be the case then I at least suggest that we make provisions for tough times ahead this year. Even if we get lucky and crypto makes a complete u-turn, it would simply be a case of counting our blessings. The important thing for me is that we are constantly on the path of long term sustainability. Hive mooning this year is good, but Hive mooning in say five years would be even sweeter because I'll hold a lot more stake. This is the time to concentrate on growing our investments.
Investors should use down cycles to re-organize their portfolios.
If you look through Hive-Engine; you will find thousands of accounts with large amounts of liquid coins. The best thing that could happen for HIVE Engine would be for the owners of these accounts to sell the coins they don't want and buy the coins they do want.
In the stock market, it is usually best just to let stocks find their natural bottom. The bottom often occurs when companies are able to use their profits to buy back substantial shares of the stock.
Companies with large debts are usually forced into Chapter 11 where they renegotiate their debts.
Unfortunately, there really isn't any sort of natural bottom with crypto. Things are even worse for blockchains with a sizeable amount of debt.
!BEER
PS: HIVE is lucky. The HBD coin did not catch on and our debt level is just 8%.
I agree and hope it happens sooner than later. This is keeping out the mainstream investors and diluting the true value of the crypto space. If people are dumb enough to lose fortunes in projects that are going to disappear then so be it as it is their own fault and we cannot have sympathy with them. Greed gets you nowhere and that is how I see many in crypto so we should not worry if they crash and burn.