Don’t Fear the Reaper: Why the Market Downtrend Is Good for Crypto
Sergey Vasylchuk is the Co-founder & CEO of the staking provider Everstake.______
As bitcoin (BTC) sunk below the USD 20,000 mark, the panicking voices filled with eschatological fervor seemed to come from around the community. The same USD 20,000 mark that five years ago looked like a pinnacle of cryptocurrency success is now a grim gravestone sitting comfortably over the crumbling pipe dreams of Lambos, luxury yachts, and gambling sprees in Monte Carlo.
This is the very thing that is wrong with this sort of thinking. Those who think of Lambos and Manhattan penthouses will always be on the losing side, no matter what market they live through. To stay in crypto, you must act like a tough entrepreneur in a highly volatile market and think about creating value for the ecosystem, not consuming it.
The market is going through yet another recession, crypto winter, downturn — you name it. Anyone with the slightest idea of risk management knew for a fact that it would happen sooner or later. The bear market always comes after bull markets and vice versa. This is as inevitable as a sunrise.
But was everyone prepared for that? No. There was no proper risk management on the part of too many people and organizations. There are always risks; accepting them means getting ready to see them become a reality.
Let’s take Anchor, a lending and borrowing platform that operated on the failed Terra platform. Too many people were mesmerized by their magical 20% offer ignoring the question of where the liquidity would come from, and never thought about the possibility of an economic attack on the protocol, which eventually happened.
They suffered severe punishment for letting pipe dreams take over their rational thinking.
Those folks on the bull
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