A bear market can create a stressful situation for investors and traders whose all time and money is invested in these projects. But don’t worry, as every investment comes with a certain type of risk, and you cannot avoid it anyhow. Thus, the point is how you will survive in such situations and NFT bear markets.
To help you out, here is a helpful guide that will exemplify the tips you should follow to survive in the NFT bear market and in some exclusive ways. In this way, it will become relatively easy for you to pay attention to your investment and take some time out to focus on whether holding it will offer you returns or not.
What is a bear market?
A bear market refers to a financial situation in which all the investment prices and values of assets fall sharply to their lower peak point. This climate is highly negative for the investors, and most start selling their assets.
It is when the market is full of fear rather than greed. In financial terms, we usually say the drop of 20% from the previous price is a bear market. Although these drop percentages may be a bit higher in the crypto market as they are highly volatile compared to other assets.
Thus, due to the high drop in prices that continue to fall for a month, people can assume the crypto market is a bear market. Several factors contribute to dropping-
- The rise in the interest rate due to inflation
- The hike in the interest rate by 0.5%.
- Poor performance of share market in the year 2021.
In certain situations, crypto prices rise quickly and fall at a double rate, leading to a bear market.
Some facts about the bear market that you should be aware of
A bear market always comes with a lot of challenges for investors. Thus, you need to constantly adjust to the behavior of the NFT bear market to survive for a long time in a bear market. You need to understand the development a bear market comes with and be aware of some of the following facts. Let’s lookout.
The bear market lasts for months or years. That is why you need to adapt to the changing situations of the bear market to survive in the long term.
The yields and profits are unlikely at certain times. Thus, if you are not lucky enough to invest in upcoming projects, your profits are limited from cryptocurrency.
It is believed that the bear market is uncertain. The value you are getting today might not be worthy, but the value you will acquire after 1 to 2 years could be worth many times.
You should be aware of these facts while dips in a bear market. It will let you know whether your investment in a bear market will go well within 1 to 2 years or not.
5 tips that will help you survive in the NFT bear market as an artist
Some basic knowledge and statistical tips can help you survive in the NFT bear market. Undoubtedly, every investment has some potential value and comes with certain risks. But these survival tips will help you a lot in analyzing the NFT bear market ups and down, and you will be able to survive in the market easily. Check out what tips you can take in the count to survive in a bear market.
1. Time management
You have allocated a lot of time analyzing the crypto market and various discords. There are chances that you might be part of several NFT projects, and there is nothing wrong with it.
But, it is also the right time to figure out a schedule for yourself and check on your priorities. Managing the time in a bear market will help you focus on your particular investment. In this way, you will be able to survive in the Bear market, especially as an artist.
2. Focus on your craft
Investments in a bear market are a great time to look at your crafts and focus on them. So down, fewer people will buy NFT projects when the market is dipping. In that situation, you can utilize that time to analyze your craft and focus on your production.
3. Connect and build your network
The third tip most NFT artists and investors should follow building a network and connections with them. In this way, if you are a beginner, you can learn more about what you should do and what not to do when the market is striking dips. In addition, you can also encourage the other investors to hold on to their projects instead of cutting out a huge loss.
4. Think out of the box
As an artist, your mind is full of creativity and problem-solving techniques. So when it gets tough and survival becomes problematic in the NFT bear markets, trust your talent. Improve your inventiveness and imagination.
For example, with NFTs, you can think about collaborating with someone to expand your reach. Or launch your collection where buyers can easily mint. You can also take elements from the purchased NFTs and sell them as imagery stocks.
Don’t freak out
No doubt, when the bear market starts dipping, you will be continuously surrounded by negative tweets, comments, and other analyses. However, do not get affected by such circumstances. Instead of that, look at the floor price of the project.
Take some time to analyze the project’s roadmap to understand better what you can expect in the future. As a long-term investor, there is nothing that you should be worried about. The NFT market is volatile and can expect changes after a certain period.
How to survive in the NFT bear market?
Due to ups and downs in the crypto market, investors have started panicking and become frustrated. Several most invested NFTs like Ethereum and Solona have witnessed some significant falls in their prices, then has made the liquidity of NFTs quite cheap.
At the top of 4800 dollars, the Ethereum market has dropped to around $2400, which is a huge top. Due to this, several investors are constantly worrying about how to survive in the NFT bear market. Thus, if you are one of them, here are some considerable ways to survive in a bear market.
You can take help from this guide and save yourself from loss. So, without wasting time, let’s look at how you can survive in the NFT bear market.
- Do not get panic
Often seeing such a measurable downfall makes people worried about their investments. NFTs depend upon the crypto market ecosystem, and these markets are independent, and up and down in price may not matter much. Thus, anyone can purchase NFTs easily with crypto or fiat currency using their debit or credit card.
That means, even at the time of downfall, some buyers still look forward to investing in a project they believe in. Thus, if you are a short-term investor, there is something to worry about, but as a long-term holder, there is nothing to stress about.
This is because; the floor prices of NFTs bear markets can return to normal after a certain period. If you believe in a project that you have invested in and there will be progress on the road map after some time, then do not panic and wait for the market to reach the normal stage.
Always keep in mind that, as such, NFT bear markets are volatile. Your investments contain volatility too. So as a long-term investor, wait until the market gets back into shape. It is pretty easy to survive in a bear market if you do not suppress yourself and don’t become restless.
2. Navigate a bear market
As an investor, there might be several conditions that are not in favor of you and the market you have invested in. the economy is too large to judge on. Nevertheless, there are certain moves that you can take to protect your investment in the NFT bear market. And that is by navigating the market.
It will help you recognize the in and out of the market, which can help you learn about your investment project. That way, it will become relatively easy for you to survive in the NFT bear market without stressing about the losses on your investment.
3. Reduce your exposure to highly volatile coins
When the market turns down, you first need to evaluate the current position of your investment and reduce the exposure to highly volatile assets. Every second new NFT projects are launched in the market.
All of them have different values and rates of investment. Thus, if the NFT bear market is already struggling and facing ups and down, it is wise to avoid highly volatile projects. In this way, you do not have to cut off instantly from the NFT market when the investments are low.
Instead, you can wait and get better results after the market niche reaches its peak. This way, it will become relatively easy for you to survive in the bear market and eventually doesn’t make a loss by the time you sell your investment.
4. Expand your knowledge of NFTs in a bear market
Remember, if you want to know everything about the bear market, you have to dig deeper. In a bear market, the investors try hard luck to find the right time to buy and sell their NFTs. Often the investor looks at short-term prices more intensively than long-term movements. However, the case is the opposite in a bull market.
Expanding your reach and knowledge about all types of cryptocurrencies during the bear market period is essential. Look at the basics of crypto and attain knowledge about crypto, NFTs, blockchain, etc. You can also learn it from different websites and the bear market official site. Refresh your knowledge if you want to survive in a bear market.
5. Cash out your profits
Undoubtedly, the crypto market stands for volatility, and the bear market can last for years. Thus, it all depends upon your state of finance. That is why; it is advised to take some time before you decide about a bear market. NFTs are a skeptical market.
So do not ever get attached to your NFT art wallet emotionally. If you purchased NFTs during the highs, it is better to cash out your profit. You will get several future opportunities to invest in a worthy project. So do not risk your investments.
Cashing out early for a new project that is still waiting to be established will help you avoid undercuts that will take place once the prices start dipping. Thus, if the NFT project is already established, you can hold it, especially when you learn about the roadmap and delivery the team offers.
6. Cut your losses
To survive in extreme circumstances, the best option is to cut out your losses and cash out your profit. Depending upon the final conditions and waiting it out is impossible, and that is why it is advisable to cash out your profit when the project floor price is declining. So, cut your losses and save your investment.
Several projects can return to their position, but some don’t recover in a bear market. Thus, take a chance to assess the values of the project. If it is convincing, you can stay in the market. If not, then cut down the losses by taking something with you. You can easily survive in the NFT bear market for a long time.
7. Invest in a stablecoin
Once you have cashed out your profits or cut down the losses, it is time to convert your purchased coins into stablecoin. It will protect your profits and prevent your investment from falling in the market. Remember, no matter how valuable the cryptocurrency is.
Holding it for too long can lead you to losses. That is why, ideally, converting your coins into stablecoins such as USDT, DAI, etc., will lock in profit and prevent you from future loss. However, if you do not know what stable coins are, they are the coins whose potential value is tied to the currency’s value.
Therefore, as there are several stablecoins to invest in, make sure you pick the one that is not questionable. You can opt for some reputed coins to trade with. For example, USDT has high liquidity and a market cap of $75 billion. Thus, if you are confused in choosing what kind of stablecoin options you have that are suitable and offer you better prevention, then here is a list for you:
- Tether
- Dai
- Binance USD
- USD coin
- TrueUSD
These are some of the best options that you have. All these coins come with a high market cap and retain a reputation in the NFT bear market.
8. Price averaging strategy
Price averaging is a strategy in which the investor evaluates and divides the total amount by the transactions or a specific price. It helps the investor to reduce risk in a bear market on the capital he has invested and makes you survive in the market for long.
Besides the DCA strategy, you can learn about stable projects in the bear market. Thus, a trader should wait until the market gets reshaped and settles down. The main aim of this strategy is to make investors learn about any active development, the road on how the project will grow in the future, and an engaged community.
No doubt, if you are a long-term holder and expect the prices to increase, then there are high chances a roadmap provided by the NFT bear market will provide you an idea of where your investment will go in the future. This way, you can make wise decisions and survive in the NFT bear market.
9. Reassess your investment portfolio
Take some advantage of the NFT bear market and reassess your portfolio. With this, you can easily cut out the projects from the portfolio that isn’t offering you any long-term valuation. Go to the marketplace and check your portfolio.
Analyze the roadmap, project updates from the creator, and floor price. If there is no hope of any improvement in the project’s potential value, weed out those poorly performed projects and replace them with those you have an eye on. If there is a project that you have always wanted to invest in, then it is the right time to get in.
10. Choose NFT projects wisely
NFT bear market is hyped and does not ever trust the gut of other investors. In this way, you will end up losing money. Instead of that, look at the potential value of the project you have an eye on and regulate whether it is worth buying or not.
You can also create a checklist and follow it while looking for the project. This way, you will know that your investment meets your checklist criteria. Never ignore any of the falls and put a watch list from which you can easily track the sales volume of the project you have invested in. however, there are certain things that your checklist must have:
- The project’s engagement with social media accounts
- The roadmap of the project
- Qualification of the team working on this project
- The total supply
- Estimated sales volume
Which these points, it will become easy for you to figure out whether your investment is worth it.
Also read about NFT Scams
The final verdict
Remember one thing; every investment comes with many ups and downs. But if you know some tips and different ways to survive in the investment market, it will be easy for you to handle the extreme circumstances. That is why; this guide will surely help you survive in the NFT bear market in case of dips.