Author: The DeFi Investor
Compiled by: Felix, PANews
Currently, almost every token has experienced weeks of decline.
If you have lost a lot of money recently, I personally suggest pausing trading, developing a new plan, and doing everything possible to avoid revenge trading.
The current goal is to survive and retain the remaining capital.
As long as you haven't lost everything and continue to stay on the "gambling table", the opportunity will come again.
Why is the market continuing to decline?
In my opinion, there are mainly two reasons:
1. There is a lot of macroeconomic uncertainty: the stock market has also been crashing, and Altcoins have always been closely related to the stock market.
Although it may sound crazy, this uncertainty is likely to be deliberately created by the US government.
Why?
Because Trump wants to force the Federal Reserve chairman to cut interest rates.
The Trump administration has repeatedly threatened to impose tariffs and then made changes at the last minute, creating a lot of panic in the market.
The Trump administration is destroying the market in this way and putting pressure on Federal Reserve Chairman Jerome Powell to cut interest rates, because when the market conditions are bad, Powell is more likely to cut interest rates.
Unfortunately, unless the Trump administration stops creating panic or Powell agrees to cut interest rates, the financial markets will continue to suffer.
Altcoins, which are seen as a high-risk asset class, are particularly affected by this news.
2. The White House's first Altcoin summit and the national BTC reserve did not achieve the expected "hype" effect.
(Don't get me wrong, the establishment of a national BTC reserve by the US still has a huge impact in the long run)
This positive news has already been digested by the market, and the fact that Trump first stated that the BTC currently held by the US will be stored in the national reserve was an event that happened a long time ago.
However, many people expected Trump to also announce a specific strategy, where the US government would gradually increase its BTC holdings over time.
But such strategic measures have not been released, and the Trump administration has only stated that it will not sell the BTC that has been confiscated. This is why the launch of the US BTC reserve ultimately became a sell-off event.
Nevertheless, the current macroeconomic uncertainty is still the main reason for the recent market crash.
When to buy the dips?
Before aggressively buying the dips, I hope to see the following scenarios occur (this is not investment advice):
- The Federal Reserve cuts interest rates - Historically, interest rate cuts are good news for the financial markets, and the Trump administration may also stop creating so much market uncertainty after everything settles down
- A new major Altcoin catalyst is about to arrive - The biggest rebound in this cycle was driven by two important past events: the launch of the spot BTC ETF and Trump's election victory
- Even in the face of bad news, BTC and Altcoins show strength - This will indicate that the sellers' tokens are about to be exhausted
Before that, I'd rather use idle funds for yield mining and airdrop farming. The market has "bled" for weeks, and it is wise to wait for signs of market recovery before buying in.
I am very confident in the "comeback" of the Altcoin market.
If the collapse of FTX, Three Arrows Capital, and Terra Luna is not enough to destroy Altcoins, what else could?
Taking high risks is sometimes reasonable, but sometimes the best approach is to wait patiently and protect the hard-earned money.
Related reading: Trump 2.0 Era: What New Changes in Altcoin Regulation? Key Policy Adjustments in the First 8 Weeks
