The cryptocurrency market is widely known for its heavy volatility and constant price swings, often leaving investors in a frenzy, particularly when there are major downturns.
While everyone loves riding on the coattails of bull markets and the hype that they bring, it’s important to remember that the downside potential can be just as fierce. What’s worse is that bear cycles often come when the market least expects them, making it difficult to time taking profits or properly exit your position.
Stablecoins have presented a new and viable alternative to traditional cryptocurrency assets, providing price stability in this rapidly fluctuating asset class. Here at Coinchange, we’re looking to maximize the benefits they offer to help protect your portfolio in times of uncertainty.
The downswings amidst a bear market can be brutal for anyone’s cryptocurrency portfolio. When it comes to 4-year cycles in Bitcoin and the overall market, bear trends generally tend to last for less time than a bull market (around 3 years of bullish sentiment typically followed by a year or so of bearish trends).
In previous cycles, we’ve seen the price of Bitcoin drop around 85% from the previous ATH (All Time High), with altcoins dropping anywhere from 90 - 95% in value over the course of a year or two. These are significant price drops that cannot be taken lightly, and investors have been left with the short end of the stick when it comes to alternate options.
Bear markets drastically drive down positive sentiment for the market and smash investor confidence. Moreover, intermediate bull traps often see the prices of digital assets momentarily rise through these bear cycles, offering a quick glimmer of hope but usually followed by a quick downturn to lower lows.
The great thing about today’s cryptocurrency market is that there are plenty of stablecoins to choose from, helping provide a unique alternative solution to traditional digital assets. These are digital representations of stable fiat currencies issued by leading companies/projects, where the most popular are those denominated in the US Dollar (such as Tether and USD Coin).
Stablecoins allow cryptocurrency traders to have a safe haven, allowing them to convert their volatile tokens into a stable asset that maintains its value. Their popularity has dramatically risen over the years, with a variety of additional use cases (i.e. for payments and lending) and available liquidity, further driving demand.
Today, stablecoins have amassed over $154 billion in total market capitalization and make up over 7% of the entire cryptocurrency market, while also contributing to over 80% of the total trading volume across exchanges. Together, they’re powering a major part of what the future of cryptocurrencies holds and igniting the next era of DeFi (decentralized finance).
Bear markets are inevitable - they’re almost guaranteed to come at one point or another. But there’s no need to worry, because with Coinchange, you can not only protect your assets from the massive price fluctuations of the market but also earn high yields on your portfolio.
Coinchange’s Earn Account provides support for the USDC and USDT stablecoins, allowing you to earn 20% interest at the time of writing. When the market turns red and everyone is in a frenzy panicking to find a solution, your tokens will still be earning a generous yield while maintaining their fiat-denominated value through their peg.
We have added fiat onramps and multiple payment options to allow you to quickly convert your cash into stablecoins so you can begin earning immediately.
Our Hield Yield Account uses a liquidity provisioning technique, meaning we deposit multiple assets into a liquidity pool to earn trading fees as profit, essentially eliminating counterparty risk. To clarify, we don’t lend assets to customers to generate the yield we provide you with, which is a key advantage we have over the competition.
So the next time a bear market comes, you’ll have the option to lock in your assets on our platform to continuously earn high yields on your stablecoins. With Coinchange, you’ll keep your portfolio’s value afloat while building upon it, increasing your net worth even in the midst of unfavorable market conditions.
Be a changer while market is a bear - earn yield on your stablecoins, risk free.
Coinchange examines strategies for Bitcoin miners to manage debt, highlighting DeFi's role in providing financial solutions and enhancing stability.
Coinchange's Dec 2023 report details asset allocation in DeFi, covering stablecoin and volatile assets, strategies, and market insights across protocols.
The Coinchange Research Team's report on stablecoins explores their transformative impact on global remittances, offering a cost-effective, secure alternative to traditional methods. It details market leaders and types of stablecoins, regulatory insights, and future implications.
This Coinchange Research report delves into the emerging paradigm of Institutional Decentralized Finance (DeFi), Regenerative Finance (ReFi) - its applications, implications, challenges, RWA Tokenization and the infrastructure enabling its rise.
Receive monthly news and insights in your inbox. Don't miss out!