Guide
How to thrive in the current market?
Are you frustrated by the market?
One day, Trump announced the US Crypto reserve and, everyone was sure about the Golden bull run. The next day, he announces Tariffs and everyone swears we're in a bear market.
Welcome to choppy markets aka a "kangaroo market". They're unpredictable, frustrating, and brutal if you are a newbie. Here's a little survival guide for ya.
#1. Rebalance your portfolio.
In the choppy markets, you should adjust your risk profile.
A significant % of the portfolio should be in stablecoins and blue chips like $BTC. Long-term assets that you have conviction are also fine such as Solana.
You should've been offloading your higher risk assets last month. But what do you do if you're already down -80% on something?
Ask yourself, if you are building a portfolio from scratch, would you buy it? If not, then sell it. There's something freeing about letting go of dead bags.
Focus on survival first. Take risks when the easy mode returns.
2. Earn yield.
A choppy market doesn't mean you can't make money. If you have a sizable portfolio, there are plenty of low-risk yield opportunities.
Here are a few to consider:
- Earn 7.15% on USDC through Fluid on Base.
- You can earn up to 5% on your Bitcoin through sBTC rewards program.
- And there are places you can get +20% on stablecoins. You have to calculate yourself if it's worth the risk vs. reward.
Instead of gambling on high-risk plays, focus on steady gains that keep your portfolio growing.
3. Accumulate systematically.
If you're bullish long-term, this is the time to accumulate. I think everyone's too obsessed over getting perfect entries and trying to time the bottom. Exposure's more important.
The goal is to buy quality assets at good prices without getting caught up in day-to-day noise.
Here's how to do it:
- Create a watchlist of tokens you want to buy.
- Set alerts for when they dip below your "easy buy" price. For example, Hyperliquid at <$15 or Solana below $100.
- Buy when the price hits your targets. Alternatively, you can use limit orders to automate this step. I personally use Jupiter for Solana assets.
This strategy gives you solid entries without constantly staring at charts. And when the bull market returns, it'll pay off.
4. Look for pockets of opportunity.
There's always a narrative pumping somewhere in crypto. Your job is to find it early.
For example, right now there are plenty of opportunities in Sonic. A Berachain DeFi ecosystem is also booming.
Always keep an eye on where liquidity and attention are moving.
On the other hand, don't over-trade either. If you want, just stabling up and waiting for easy mode is fine as well.
5. Don't try to time the exact bottom
It's a choppy market. Prices are going to chop up and down — that's the nature of it. Too many people try to catch the exact bottom, that's a fool's game.
I'm ok missing the first 20% of a move if it means I enter with more confidence.
Patience > FOMO.
6. Build your cashflow and skills
During the bull market, you won't have time to do anything.
If you don't have enough cash flow to trade crypto, level up and increase your income.
If you already have a sizeable crypto portfolio, this is the time to master crypto investing. There are a lot of sub-skills involved in crypto investing.
- Onchain analysis
- Earning DeFi yields
- Discovering new gems
- Protocol evaluation
- And more
You can build all the relevant skills on your own. But it'll take a lot of time.
But if you want to learn all of those in a structured course with a community, check out TDE Pro.
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Protocol Updates
Solana's tokenomics might be changing
Token supply is everything in crypto (kinda).
BTC is digital gold because of the 21M cap. ETH was ultra-sound money because of EIP-1559. And now, Solana is making major changes to its tokenomics.
What's happening? A new proposal (SMID 228) is looking to change the Solana inflation rate.
Like most chains, validators maintain the Solana network. New $SOL tokens are issued to them for their service.
Right now, $SOL follows Cosmos-style issuance. The inflation rate decreases annually by a fixed disinflation rate (15%) until it reaches the long-term target of 1.5%.
The problem? This inflates the $SOL supply too much. The current SOL inflation rate is ~4.7%. In contrast, the ETH inflation rate for the last 30 days is ~0.7%.
The new proposal will change the emission mechanism. In the new system, the emission rate will be decided by the % of the $SOL staked.
- Low staking participation → Higher emissions (to incentivize more staking).
- High staking participation → Lower emissions (to encourage unstaking).
If passed, the new mechanism should reduce the inflation from 4.7% to ~1%.
Not everyone is convinced this is a good idea.
- Reduced decentralization. If the rewards go down, it'll reduce the validator's profitability. This might push smaller validators out of business.
- Security risks. Some people worry that the new mechanism would put Solana's network security at risk. You can read an argument here.
On the flip side, there are strong arguments in favor as well.
- Better for the price. Lower emissions mean less selling pressure. Simple as that.
- Increased DeFi participation. With staking yields dropping, $SOL holders will seek yield in DeFi instead, increasing ecosystem activity.
While that sounds nice in theory, it might not happen in practice. We can't be sure that DeFi participation will rise.
Most of the community is in favor of the proposal. So, it'll probably pass.
When it comes to $SOL, there are both bullish and bearish factors. Let's start with bullish factors.
- Inflation reduction can become a catalyst that pumps $SOL in the short term. In the long term, it'll massively reduce selling pressure.
- Crypto stockpile & ETFs. The Trump admin will probably allow $SOL ETFs. It'll probably include $SOL in the upcoming crypto stockpile as well. These will
- Leading smart contract chain. Solana is still leading in daily transactions, active addresses, and DEX volume. But it has lost its big lead against Ethereum.
- The relative market cap is low. Some people believe Solana should be valued equal to Ethereum. But relative to $ETH's $275B market cap, $SOL only has $75B. Even XRP has ~$150B in MC.
- Proven tech. Going offline was a major criticism of Solana. Now Solana had completed an entire year without any major issue.
It also handled an insane volume of $TRUMP & $MELANIA. Solana is the only chain that has handled such an insane real-world load.
On the other hand, there are some bearish factors as well.
#1. Token unlocks. Solana had a massive unlock worth ~$1.5 billion on March 1st. And millions will continue to enter the market in the coming months.
The current price is at a respectable ~$150. Till now, the impact hasn't been as bad as expected.
But it's still possible for the new supply to put downward pressure.
#2. Death of memecoins. Due to blatant grifting, the sentiment has turned against memecoins. Since $LIBRA, the memecoin volume on Solana is at YTD lows.
The current Solana economy is built on memecoins. All the top projects on Solana are related to memecoins. Pumpfun to launch memecoins, Jupiter & TG bots to trade them, and so on. This is reflected in Solana's falling metrics.
If Solana fails to redirect their momentum and energy to other sectors like DeFAI, it'll be bearish for Solana.
#3. Macro. As I talked about in the last newsletter, Macro is the most important factor that determines the price in the medium term.
And right now, Macro is terrible. Interest rates are still high, there are new trade wars, and the Russia-Ukraine war doesn't look to be ending.
So overall, we are a choppy market. And I'm not looking to catch a falling knife.
🚀 DeFi Catalysts
MegaETH will launch its testnet today. There'll be a dedicated onboarding for builders till the 10th. User onboarding will be after the 10th.
Morpho Labs introduced Pre-Liquidations. It can give borrowers opt-in loan management features like auto deleverage and auto close.
Aave is discussing a new implementation proposal for the updated Aavenomics. It includes updating AAVE tokenomics, protocol excess revenue redistribution, and more.
Sky Ecosystem (formerly Maker) expanded USDS to Arbitrum. It'll be a big new market for USDS to expand.
Aevo introduced Options OTC 2.0. It'll be an onchain OTC desk on Aevo L2, bringing institutional-grade liquidity and experience to traders
Jumper Exchange has integrated Sonic. You can now easily bridge USDT, USDC, wETH, and more to and from Sonic.
Celo has announced the date for transitioning into an Ethereum L2. The L2 mainnet will activate on March 26, 2025, at 3 am UTC.
Synthetix founder released a post outlining a new direction for the protocol. It discusses a new staking model that'll help protocol generate yield and alleviate past issues.
🪂 Airdrop Alpha
Dolomite, a money market and margin trading protocol, released an airdrop checker for their upcoming token.
YieldNest is airdropping tokens to the Taiko community. Your Taiko Status determines your share, and you can still become eligible.
KelpDAO has postponed the TGE for KernelDAO to March 2025. The falling sentiment is probably the reason for the shift.
🚀 New Launches
Royco Protocol allows anyone to create a market for any onchain action called Incentivized Action Markets (IAMs). It went live on Sonic with boosted yields.
Lens Reputation has started its Test Phase. It's an onchain reputation protocol on the Lens Chain.
Blackbird released Flynet. It's their purpose-built network designed to cut fees, give restaurants control over their data, and create a new economy of loyalty.
📰 Industry News
Reddit founder, Alexis Ohanian, is trying to buy TikTok and bring it onchain. It'll be massive for the crypto economy.
BioNexus Gene Lab, a publicly listed corporation on Nasdaq, has approved a treasury strategy for ETH and released a related strategic white paper.
🐦⬛ X Hits
- HyperLiquid thesis.
- SOON Network explainer.
- Different stages of the market.
- A comprehensive introduction to InfoFi
- How did Ethena handle the collateral backing during the Bybit hack?
😂 Meme
Until next time,
Edgy
Today's email was written by Edgy and Yayya.
DISCLAIMER: I'm NOT a financial advisor. This content is for education and information purposes only. Crypto and DeFi are risky and speculative. Please do your research before investing.
Whenever you're ready, here's how we can help you:
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