* How can bears make money with crypto? What can you do with crypto when there is a bear market for it? * How can you make a profit in a bearish cryptomarket?
Markets do not rise in a straight line. Market prices are affected by investor sentiments and fluctuations in the business cycle.
Although most financial markets tend to move upwards over the long-term, there will be times when they experience a Bear phase. The same principles apply to the Crypto market.
The Reality vs. Crypto Market Expectations
However, the majority of investors only participate in the Bull phase and then they fade away as soon as it arrives. It is also known by the Fear Phase.
Crypto Market Fear vs. Greed Index
Strategies that work in a Bull market are not effective in a Bear market. A majority of people earn in a Bull market, but only a few are successful in a Bear market.
This post will give you strategies to make money during a Bear market. You decide how to use them and win in a bloody market.
Here’s a quick overview of the top ways to make money on the Crypto Bear Market.
S. No.How to Make Money in a Bear MarketStrategy Benefits in a Bear Market1Buy the Dip with DCAa) Buy crypto assets at throwaway prices b) Build Discipline in the investment process2Short-Sellinga) Make money in a downtrend b) Sell an asset without owning it3Crypto Savings and Lendinga) Earn free crypto tokens b) Cover up losses caused by the Bear Market4Stakinga) Earn free crypto tokens b) Cover up losses caused by the Bear Market c) Avoid panic selling d) Liquid staking5Yield Farming and Liquidity Mininga) Earn free crypto tokens b) Cover up losses caused by the Bear Market6Scalp Trading with Grid Botsa) The end of the Bear phase is the best time to start a Grid Trading Bot b) Automate your trading strategies c) Make money while you sleep7Researcha) Find the next possible 100x crypto gem b) Upgrade your crypto knowledge
Let’s now dive in to each one.
The Best Ways To Make Profit in Crypto Bear Market
These are the top ways to make a profit in a Crypto Bear market:
1. Buy the Dip with Dollar Cost Averaging (DCA).
You can accumulate your crypto tokens at a bargain price during the bear phase. It is important to invest in the Bear phase, as opposed to the Bull phase when prices are high.
Buy the Dip is the common term for buying when the market enters a bear phase.
You can also buy this Dip in Lumpsum. This allows you to invest all of your money at once. There is another option: Dollar Cost Averaging (DCA), also known as. Systematic Investment Plan (SIP).
DCA is a strategy that allows you to buy small amounts of crypto tokens over a time period. If you are looking to invest $100,000 in ETH token (Ethereum), then instead of investing the $100,000 in one lump sum (a.k.a. Instead of investing $100,000 in one lump sum, you could divide the investment into multiple purchases. Let’s suppose you purchase $1000 worth of ETH every day for the next 100 days.
This strategy can help you in two ways.
This reduces volatility in prices and allows you to maintain an average investment cost over the long-term. It also brings discipline to your investment process by investing a small amount of your money in your favorite crypto tokens.
You can also automate your strategy with many tools available in the crypto market. These purchase orders can be automated, so you don’t have to do them manually. You can just give instructions to a trading platform or bot.
Our List of Best Crypto DCA Bots can be consulted. You can also read our Binance Auto-Invest guide for DCA on Binance.
2. Short-Selling
One of the most common ways to make money in a Bear or Downtrend is short selling. This is a trading strategy that allows you to sell an asset even if it’s not yours.
One rule applies to all trading and investment activities. Buy Low and Sell High (BLSH). Short selling differs from traditional short selling in that you sell first and buy later. It is expected that the price for a crypto token in the future will be lower than its current price.
Let’s say, for example, that the ETH token is currently in a downtrend. It currently trades at $3,000. It is currently trading at $3,000. However, you anticipate it to rise to $2,500. You will short-sell ETH at $3,000 and then buy it when the price reaches $2,500. This transaction will net you $500 (before transaction costs).
There are generally two ways to short-sell crypto assets in a market.
Futures Trading and Margin Trading
We have separate guides on Short Selling crypto with Binance Futures Trading, and Short Selling cryptocurrency with Binance Margin Trading. You can also learn how you can short sell bitcoin on ByBit.
You can also start Margin Trading if this is your first time.
3. Crypto Savings and Crypto Lending
Savings or lending are good ways to make passive income from crypto investments if they are losing money during bear phases.
These strategies have the following benefits:
Depositing assets on a protocol or platform will get you a free crypto token. These tokens can be used to offset losses due to the bear markets.
Crypto Savings allows you to store your money and earn interest. These services are offered by many exchanges. Both centralized and uncentralized ecosystems offer savings features.
Binance offers Binance Savings on centralized platforms. Anchor Protocol allows you to deposit UST (TerraUSD), which will give you a steady return.
You can also lend your crypto assets in order to earn interest. For more information, please refer to the Binance Lending Guide. Lending can be risky because of the possibility that a third party defaults, which could lead to losses. You should only do this on trusted platforms. You should also ensure that the platform does not lend without sufficient collateral from the borrower.
These are some of the most popular cryptocurrency lending platforms:
CelsiusAAVECompoundMakerDAO
4. Crypto Staking
Another lucrative way to earn passive rewards for your crypto tokens is by stake. The platform will reward you with more tokens if your crypto tokens are locked on it.
These are the benefits of staking your crypto-token during a bear phase:
Get crypto tokens free of charge. You can use them to cover losses from the bear phase. Your funds are also locked on a platform so you avoid panic selling.
It is similar to earning dividends from your equity stocks, but stakes are different. Proof of Stake (PoS), a blockchain network, uses this concept. To learn more, you can refer to CoinSutra Staking guide for beginners.
These networks include Terra (LUNA), Cosmos(ATOM), Solana [SOL], Solana [SOL], Solana (SOL), Solana (“SOL”), Cardano (“ADA”), Fantom “FTM,” Secret (SCRT) and many others.
These tokens have the following base annual Staking Rewards (StakingRewards.com), as of May 9, 2022:
Staking in Crypto Bear Market
Let’s use the Solana Network as an example. The Solana Network is made more secure by every stake of SOL tokens. The network will reward you with more SOL tokens.
Staking is a way to lock your funds on a platform. While your assets are staked, you don’t have liquidity. Liquid Staking is a solution to this problem.
Liquid Staking allows you to get a derivative token that can be used for the purpose of staking your asset. Lido Finance is one of the largest Decentralized Liquid Staking Platforms in the world. To learn more about Liquid Staking, you can consult the Fundamental Research Report of Lido Finance (LDO).
Let’s use the same SOL (Solana), example. You can stake SOL tokens via Lido Finance and receive stSOL tokens. This is a receipt for the staked SOL tokens. These stSOL tokens can be used in many ways.
To make more money on them, you can either loan them through DeFi (Decentralised Financing) platforms or sell them on the open market to liquidate SOL’s position
You can therefore maintain liquidity even if funds are staked on the platform.
After you’ve mastered the basics of Staking, you can view our list of top Proof of Stake cryptocurrencies. You can also view our Step-by-Step Guides to Staking for some of the top altcoins:
Stake Ethereum (Ethereum). Token on BinanceStake Ethereum (Ethereum). Token using Ledger Nano hardware WalletStake Ethereum (Ethereum). Token on Lido.FinanceBest methods to stake SOL(Solana). TokensStake AVAX, Avalanche. Token on Avalanche. WalletStake MANA. (Decentraland). Token
5. Yield Farming and Liquidity Mining
Yield Farming, Liquidity Mining and Liquidity Mining allow you to get free crypto tokens to provide liquidity to DeFi (Decentralized Finance).
Yield farming refers to the process in which a crypto holder transfers his assets to a DeFi platform. The Liquidity Provider is the name given to the crypto holder who provides liquidity for the platform.
The platforms offer a reward system for the Liquidity Provider in return. These rewards are usually paid out of the revenue generated by the platform, which can include fees and interest collected from platform users. This is called Yield Farming.
Occasionally, the platform will also distribute or airdrop its native tokens for free. This is Liquidity Mining.
Let’s look at an example to help us understand. Uniswap (DEX) is a Decentralised Exchange. Anybody can deposit crypto assets to Uniswap Liquidity Pools. Uniswap will pay a portion of the fees collected by the exchange in return. This is Yield Farming.
Uniswap has also previously airdropped UNI tokens, which are in-house tokens of Uniswap. This is Liquidity Mining.
Yield Farming in bear phases and Liquidity Mining are both very beneficial.
Earn free crypto tokens passively
The following guides provide basic information about these topics:
Beginners Guide to Decentralized Finance (DeFi). Beginners Guide to Liquidity poolsGuide to Impermanent Loss to DeFi Users
You can also check out the tutorials and guides below to learn more about Yield Farming.
Bancor Protocol – No Impermanent Loss DeFi Platform
6. Scalp trading with Grid Bots
Automating your trading strategies can be one of the best ways you can make money in crypto markets. Grid Bots makes it possible to automate scalp trade strategies. You can make money with crypto even while you’re sleeping.
When the market reverses towards an upward trend, the last phase of a bearish market is the best time for Grid Trading Bots to be initiated.
As you probably know, cryptocurrency is the most volatile asset at the moment. Grid Bots allow you to take advantage of this volatility to make your money.
A grid bot allows you to set a price range. Let’s take ETH (Ethereum Tokens) as an example. You set a price range from $2,500 to $3,000. This range will be divided into several grids. Let’s say there are ten grids. The grid levels would then be $2,500, $2600, $2700 ……… $2,400, and $3,500.
You will still make money as long as the price of ETH is within this range. The bot will continue to buy and sell at every price level. This saves you the time and effort of manually executing transactions.
These Bot Strategies have been tested for several years. These Grid Bots can be used to make traders between 0.5% and 1% per day (or 15% to 30% per month).
Our Beginners’ Guide to Crypto Bots can help you get started on your Crypto Bot journey. Our list of the Best Crypto Trading Bots is also available.
If you are serious about learning everything you can about Grid Bot Trading, we offer a comprehensive Grid Bot Trading Course at VIP.CoinSutra. This course will teach you the basics of Grid Bot Trading. You will also have access to CoinSutra’s VIP community where you can share your top Grid Bot pairs with their profits.
See screenshots of Grid Bots users who have made a lot of money.
7. Learn and Research
The bear market is the best opportunity to improve your crypto knowledge. This is when the market is quiet. This allows you to focus your efforts on new concepts and projects.
CoinSutra is here to help. There are dozens of blog posts and videos that you can download for free to help you learn crypto. This includes tutorials, guides, and more about the basics of cryptocurrency.
You can also use this time to search for the Next 100X Crypto gem. Coinsutra publishes project-specific Fundamental Research Reports that will help you determine whether a cryptocurrency token is worth investing in.
These Fundamental Research Reports are available to CoinSutra VIP members at least 30 days prior to being published for regular users. If you are looking for that first-mover advantage then sign up Vip.CoinSutra.
You can also explore our top FREE Fundamental Research Reports by clicking the following link:
The Sandbox (SAND), Metaverse – Fundamental Research BerichtGala Games(GALA) – Fundamental Research reportSecret Networks (SCRT) – Fundamental Research ReturnLido Finances (LDO) Fundamental Research ReportDecentral Games (DG), Fundamental Research Report
Conclusion – Top Tips to Make Money In Crypto Bear Market
These are the best ways to navigate through a Bear Market. There are not enough techniques to be successful in all of the listed methods. Pick one technique and study it in detail.
Each method is an individual skill. Don’t rush the process, and allow yourself to take it at your own pace.
Is it possible to make money in a bear-market?
Every market environment can make money. Only one thing is constant: the strategies you choose to implement them. This is something you need to consider carefully.
This post is intended for education purposes only. This article does not contain any investment or trading advice. Before making any investment or trading decisions, please DYOR (Do Your Own Research), or consult your investment advisor.
This concludes this post. Leave your comments below. Subscribe to CoinSutra Newsletter for your free trading ebook.
