Sentiment in the cryptocurrency market is volatile and can turn 180 degrees in a matter of days. Therefore, it is important to consider the trends, and blockchain technology is one of them.
Market sentiment is by definition volatile and short-term, which are trends that last for a long time. Trends are important to follow when making long term investments.
Inexperienced investors fall into the trap of following the current market sentiment in a direction, and interpreting the trend based on their own temporary emotions. This is wrong because the cryptocurrency market has its own cycles.
An investor hides during a bear market
As I said, blockchain with other technologies such as artificial intelligence is a trend of the present and future. This topic has been covered in a variety of books and publications.
On the other hand, companies often need external financing, especially at the start-up stage. Cryptocurrency bears are often where the roadblock comes in, as companies fail to raise funds for their projects during this time. In the pre-sale, they are having trouble selling their tokens.
This is not an uncommon problem, as quite a few companies when contacting us ask how they can raise money during a bear market.
On the one hand, I can understand this. Since the cryptocurrency market is cyclical, there are regular fears and depressions every few years. Then, unlike a bull market, investors are less enthusiastic about investing in new tokens.
They watch every dollar two or even three times before spending it on a newly created project.
However, cryptocurrency bears are healthy because they filter the market and separate short-term speculative trends from projects that want to stay in the market for a longer period. This means that the market is dumping crypto projects artificially inflated with empty promises.
When the market is down, investors have the opportunity to invest in projects of real value. We can say that the bear market, in a way, protects the capital of investors and reduces the risk of fraud.
Are Cryptocurrency Projects Better During a Bear Market?
Projects created during a bear market are usually more rational. Companies in a bear market don’t usually spend a lot of money on marketing, so they must show investors their true value. They assume realistic goals without marketing hype. Investors during a bull market are more cautious and suspicious, so colorful banners or big promises don’t work “well” anymore.
A bear market is a time to get down to earth, so only the real benefit of a project can convince an investor. A company that develops projects during an economic downturn shows investors that they are competent and strong. In fact, if they can build through the tough times, imagine how successful they will be when Bitcoin hits new highs.
We already know that launching new projects in a bear market can be beneficial. However, organizing project financing remains a challenge when investors do not want to look at the market and keep their money away from cryptocurrency exchanges, often counting unrealized losses. Getting them involved isn’t always easy.
However, it is possible to find new investors, those who have not yet had experience with Web 3.0. Here, in fact, lies a huge potential. To be honest, the blockchain is in its infancy, and most people still don’t fully understand its potential.
So it’s worth helping them out of Web 2.0. The biggest opportunity for new Web 3.0 projects and true mass adoption of cryptocurrency lies with the people who are currently working on Web 2.0 (about 95%).
The bridge between traditional finance and Blockchain
Companies need to build a technology bridge for people to help them move directly from Web 2.0 to Web 3.0. We are talking about the phenomenon of increasing adoption of new technologies among the public.
For the first-time investor, the most important aspects of project financing are the user experience (UX) during the process and the simplicity of a crypto portfolio. The project needs to provide a simple tool to purchase tokens during funding rounds.
For those in the traditional finance space, buying tokens on a cryptocurrency exchange is a big deal. Let’s be honest, most potential investors wouldn’t do that, even if they liked the project. Additionally, cryptocurrency exchanges have not had a great reputation lately, and each crash is a new media narrative for the next few months and sometimes years.
This is what new investors want
Like I said earlier, UX impact is key. Building wallets and simple payment gateways where the investor from traditional finance will not have much discomfort when buying tokens in Web 3.0. It therefore becomes essential that the user can purchase tokens directly on the company’s website. without opening additional windows.
For companies with dedicated fans and site users, this can be a game-changer. Additionally, investors should have the option to move directly from traditional money (fiat currencies) to blockchain tokens.
It is crucial that companies create software that allows investors to pay for their tokens using traditional banking methods. The company I represent builds this type of solution. This is the Ari10 Gateway tool.
It is an encrypted digital payment gateway that we also share with other companies. In addition to paying by bank transfer or credit card, investors can also use it paysafecard To buy cryptocurrency and tokens.
Our goal is to provide sufficient payment options to reach the widest possible range of customers. In a bear market, these factors make it easier for new projects to get financing and succeed.
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Co-founder and CEO of Ari10. Blockchain Advocate involved in various fintech and blockchain projects. University Lecturer in Blockchain Technology Law and investor and advisor in several cryptocurrency and non-cryptocurrency related companies.
In accordance with Trust Project guidelines, this opinion article presents the author’s view and may not necessarily reflect the views of BeInCrypto. BeInCrypto remains committed to transparent reporting and upholding the highest standards of journalism. Readers are advised to independently verify information and consult with a professional before making decisions based on this content.