"Cryptowinter" has just begun, the end has not come yet. Miners are waiting for the end or some kind of bottom to buy equipment, but they may not wait - this moment is impossible to predict. Therefore, it is better to diversify risks and split the planned purchase into several iterations - for example, to purchase equipment at intervals of three months. That way, there will be four iterations over the next year to create an asset in the form of mining equipment.
Why does this happen?
This is a trader's story and absolutely a market story. Everyone is waiting for something, that's obvious, and when six months from now many players think Cryptowinter is about to end, they're going to start buying. "When everyone is selling, buy; when everyone is buying, sell." The closer the end of "winter" is perceived by investors, the higher the demand for equipment will be. And, accordingly, at the very end, demand will be highest. Over the last five years the market has become very popular, everybody knows about it, including big Western investors. Obvious actions like "I will wait for the end of Cryptowinter and buy it in a year" will simply not work - the whole market will do it.
Has the optimal entry point arrived?
Nothing good can be expected in the near future. This is such a psychological moment, just revealing the principle described above. Miners who have already bought equipment will be in the "Cryptowinter" for another year in the near future: paying for electricity and waiting for an increase in the tariff. That is why the price is very low now and there is no demand, these are exactly the times when you need to buy. Yes, at the end of Cryptowinter the tariff may be at $20K, but demand will be much higher and the price of equipment will go up.
Why does everyone think the bear market will last another year?
Let's look at the chart and compare the situation of 2017 and 2020. There was a downturn in 2016, then a strong rebound in 2017, and then there was a Cryptowinter all through 2018 and into mid-2019. A small rebound followed, with the market up about 50%, but then it fell again until the summer of 2020. Many believe the same thing will happen now: the decline will last until spring/summer 2023, and then a nice rebound will begin. And rapid growth will begin in late 2024.
That's what about half or more of the experienced players are betting on right now. But it's impossible to predict the best entry point; it's always worth diversifying the market.
The main rule of the market is to buy an asset as cheaply as possible. In our case, that asset is computing power. The lowest prices for mining equipment will be in the coming months, and by the end of the Cryptowinter they are likely to rise. Most importantly, the strategy is not to invest all the money right now. It is also important to diversify your investments over time.
In addition, another advantage is that US is in a geographically advantageous position, and the price of electricity here is one of the lowest in the world, so in the case of miners shutdown, US will be one of the last countries where cryptocurrency mining will stop. At the same time, due to the mass shutdown of equipment in countries with expensive electricity has always reduced the complexity of the bitcoin network, which allowed more money to be earned in those countries where the process of mining continued. Because of this, miners from the USA almost never made a loss, unless they were mining digital currencies on outdated equipment.
It should be taken into account that the underlying asset is very volatile and can fall sharply. That's why time diversification is important: if bitcoin falls to $10,000, you can buy more equipment. The point is to keep liquidity in cash (currency), but not in real estate or anything else. Because live "cash" is the most liquid. You need it in order to have time to buy during a major crisis when everything sells out. Usually, few people have liquidity left in such an environment.
Let's say you have $100k you want to invest. Invest $20k and see after three months what happened. Then invest the same amount again.
You have to learn to be a good speculator, put away your emotions and look at the story sensibly. First, without emotion, and second, not like everyone else. Right now, there are a huge number of players who are waiting for the "crypto-winter" to end. Thanks to them, the demand for hardware will eventually grow significantly. It is difficult to give any exact predictions. But the price of terraces may grow by 40-50%, even if the market stays at the current rate of $20,000. The main thing at this point is to be among those who are selling, not buying.
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