I have quite a bit (for me, but chump change for many people here) of money invested in a spectrum of cryptos. When I woke up yesterday and saw the value of my investments had lost about $4000 in value yesterday I had a WTF moment, but I didn't panic. Why didn't I panic? These things happen frequently.
Also in looking across the cryptos I realized it wasn't that I made bad investment picks for the cryptos I have funds in. It was in fact a huge dip across ALL cryptos that I looked at. The exception being Tether which is simply a US Dollar Tether. It jumped up as a lot of people likely temporarily stored their cryptos there.
Still, I found myself wanting to know what caused this dip. So I looked around. Then I found out there has been a nearly identical dip the last 4 years. It has happened mid-January every year. It has then rallied not long after that. The only thing I can think of for around that time is tax season. This may not be the case, but the dip itself seems like an annual pattern that happens. I wish I had been aware of this pattern before hand. I would have sold all my crypto at the beginning of January and then bought back in at a low spot in the expected dip. Next year!
It has fallen further today but not as rapidly. It has popped up a bit here and there.
The key of what is happening is that last week I saw a point when Cryptos had a combined $750 Billion Market Cap. I just now looked at coinmarketcap.com again and the current market cap is listed as $489 Billion. This is a large chunk of money pulled out of cryptos across the board.
This is not the only factor. A banker decided to come out and state that governments could ban cryptos. How are they going to do that? If they could do that it would have happened to Bitcoin years ago. If they are centralized like Ripple they might be able to stop it. If they are decentralized they can't do much about it. This is why so many of us make a big deal about decentralization. Decentralization is the key to stopping censorship. Censorship is just a form of banning. It doesn't work on decentralized systems unless you can simultaneously and quickly take out enough nodes to damage that network.
For example this is why Steem runs on the witnesses. The top 19 witnesses are the storage around the world for the steem blockchain. There are far more than 19 witnesses though. There are plenty of nodes not in the top 19 that are available and ready to jump in take over duties if one of the 19 go down.
If enough nodes are running on a place like Amazon Cloud (AWS) then potentially those nodes could all be taken out at once, but then nodes that are all over the place and not on Amazon or some other corporate cloud will spring into action.
Other cryptos that are decentralized have a similar setup.
I have a positive outlook that we will see a rally. If I had more money available I'd be buying more crypto while it is low.
I've been on steemit since Aug16...on Jan1 of 17 I had no money (to speak of...just a few dollars)...so I didn't pay the market no never mind. I just kept on doing on Steemit what I had been doing on FaceBook, but for nickels and dimes rather than for free.
Well LOOKIE HERE...a year later and I haz some money..
If I'da knowd what you said I'd have MORE.
thanks for the info...I'll remember next december..
Great story! Seriously. I'm just plugging away and hope to eventually move up on the reputation score. 72 for you from nothing but work is amazing!
Make sure to build a portfolio you can hold onto as you earn more money. Before this big dip I was up 25x. I'm not smart enough to regularly trade and make money. I'm doing a few coins for trades, but mostly a long term portfolio. There is literally trillions of dollars coming into the crypto market in 2018 from institutional money. It has to go somewhere and this mean the overall market is going up.
reputation is earned.
it has nothing to do with the amount of steem you have or the amount that you invested.
I preeeeedict...more and more bull markets.
even stupid people like me can make money in a bull market.
Yeah me too. I was lucky if I got to spend $50 of my own monthly paychecks on something I wanted rather than on bills and my family UNTIL I discovered steemit.
It has been extremely liberating. I made enough that I gradually bought some cryptos outside of steemit and I think at one point I had about $20,000 in various cryptos. That's pretty cool to be there from nothing and have a steemit account that is worth more than that.
My crypto is NOT worth $20,000 right now... it lost quite a bit of value but I expect that to turn around. We just need to remember this pattern next year.
I like keeping steem power in the platform, but I also like owning a bunch of crypto as that crypto is all something I can convert to something spendable in an emergency without a delay.
well..between me, you and whoever else is reading this (not many people I expect)
I had zero monies in my fiat portal exchange around christmas.
since then I've used steemit generated monies to buy cryptos, then resell for fiat
and pay off about twenty grand of debt.
I iz now worth NOTHING...I have zero net worth (except for crypto)
as opposed to way negative for the last way lots of many, many years..
Yay steemit.
I'm reading it @everittdmickey :) and I'm very happy for you and the future here! I'm only a month in on steemit but am optimistic about this whole thing. In the evenings I "wander" around here for hours and I've seen you before (@humanearl 's post i think)..I'm only mentioning it because I'm starting to recognise faces and names instead of it all as one big blur haha. I guess though, @dwinblood, these dips are like 'old-school' investment markets and we need to look at the long term? Thank you for the info for sure...being a newbie to crypto in general, I really appreciate all that I can learn. Cheers!
do what you want to do but me personally...I 'follow' those who I recognize. If I like what they say I keep following them...if not..then not. I follow very FEW people. Less than a hundred. I attempt to 'know' everyone that I do follow.
'monkeysphere'...and stuff.
Funny. I was just going through the list of those I follow and doing a purge because my feed is too full of things I'm not interested in. Your idea is a good one. Thanks:)
Yep I've been paying off some bills with crypto too.
I told the wife..
NEVER again will we go into debt.
Sleep in the boat first.
I dunno if she believed me or not..
I'm serious.
Yeah, I am pretty sure I could survive on crypto, steemit and some other things if I had to. I'd have to be a lot more active but I could do it.
I have a day job and as long as I have that steemit is becoming an avenue of getting out of debt. I have a long way to go... stupid student loans.
I'm pretty sure I could live off crypto.
It might entail living on the boat
(once I get it finished)
and eating a lot of fish, game birds, and maybe wild game
(I haz gunz)
awwwwww.
wouldn't that just be horrible?
Everybody is very worried about currency pattern, because when it is possible, nothing can be said.
If by a chance we are witnessing the end of cryptos (we still think that this is just a minor correction) then we would be very surprised as the max market cap of the crypto market was even less than 800 BLN USD - which is by far less thant DotCom bubble at its highs! https://steemit.com/crypto/@p2port.com/cryptocurrencies-bubble-or-not-dotcom-example )
It is no bubble. It is very different from investing in companies like the dotcom situation, and it is even different from stocks. Mainly because we exchange them, buy things with them, etc.
It is a very new paradigm. So if we compare it to anything from our past it likely won't quite fit.
We are exploring strange and wonderous new territory.
Cryptos are here to say. They make traditional currency look silly. The adoption will continue.
We think that any new tech or even paradigm tend to skew to overvaluation at first stages. Cryptos are not an exception. But we do believe that we have a substantial room for a growth!
Yeah I think this is the future of currency. Thus, it may be fiat that ends up being the bubble.
It surprises me just how surprised people are of days like these. If anything, it would be weird if something continued to skyrocket in value without ever seeing massive corrections.
Great post. Interesting pattern. I couldn't even guess why it's so repeatable, but it does confirm there is absolution no reason for all the panic I've read on steemit.
Blockchains are going to upend complete businesses with completely new business models. Already there is one that aims to replace Uber and no longer have them as a middle man. Same for Airbnb. Steemit may affect social media in the near future. One crypto is setting up to be the google of search across all blockchains. I'm excited to witness this. What an incredible investment opportunity its been in just 10 months for me. We are only at the beginning.
Is that money pulled out, or lost value?
As far as I know loss of value can only occur by the currency moving around. So it would need to be pulled out.
Agreed. Price goes down when everyone is selling. So that is real money that has left the market. But fear not, it will be back and this is an amazing time to buy this correction.
That's true. It happens every January. Big things are coming for crypto this year. HODL.
I just had a talk w/ my grandma,And I said pretty much the same thing,and covered the same issues.
lol.
Sheeple be selling and taking there losses. Happy to be sheared,like they lost weight or something...
;-)
I've seen posts in the recent past to show that in a year, market cap has grown 900%. This growth has been fairly organic. Nobody is advertising crypto on TV, radio or in the movie houses. Most of the growth has been by word of mouth and the promotion is done by people who really believe in crypto.
The decentralized aspect to crypto is very, very appealing. I also like the way crypto is displacing government issued currency. That means to me, if crypto becomes the norm in every day life, we can move away from the boom and the bust cycle that has been engineered by governments around the world.
The most interesting aspect to crypto is that it's fairly democratic. A cryptocurrency only has as much value as people are willing to give it. I think that the turning point will come when we stop calculating value in terms of the dollar and start to think of crypto value in terms of commodities like labor, oats, coffee and steel.
yah think?
we don't think of fiat in those terms
if we did it would be startling.
forex...we (in the US) spend less than ten percent of family income on food.
DOWN from about seventeen percent less than fifty years ago.
which was WAY DOWN from any time in history up until then.