Three Projects to Power Up Your Crypto Portfolio in a Down Market
“The time to buy is when there’s blood in the streets” — Baron Rothschild
“Be fearful when others are greedy, and greedy when others are fearful” — Warren Buffett
Rothschild and Buffet are from two different eras, but they both understood that the way to make money in financial markets is to buy assets when they are underpriced and sell when price is high. And they both made fortunes practicing what they preached.
Financial markets have been in a tizzy of late, with everything from stocks to bonds and cryptocurrencies taking a beating. As markets fall and more people sell, it creates a cascading effect, causing markets to fall even further. Fortunes will be lost in these market conditions, but for the brave souls who are willing to buy, fortunes can be made.
Buying when everything is falling around you is easier said than done. You could catch a falling knife trying to buy, as no one knows when prices will stop falling. But you do not need to know when prices will stop falling to profit from a down market. Nobody can time the market perfectly. Warren Buffett probably never did. You can buy depressed assets and they fall even further, but if you buy assets with strong fundamentals, you can catch enough of the upside when they recover and make healthy returns.
Below are I delve into three crypto projects that have suffered under the weight of the market but may represent good buying opportunities.
First up is DRIP, the god daddy of passive income projects, paying out 1% a day consistently for over a year now. Many people — including yours truly — have made solid returns from DRIP and continue to make money even with DRIP at a much lower price than it was a few months ago. Because the 1% daily is paid out in the DRIP token, returns are now much lower, but you are still making those returns.
At $18.71 at the time of writing, you can look at DRIP price in one of two ways: a rekt project to be avoided at all costs or a buying opportunity. No one can predict the future so all we can rely on is our experience to decipher what might happen to the price. We are aware of the volatility of cryptocurrencies. The big daddy of all cryptos, Bitcoin, has lost more than half its value in the last six months, and tumbled by a third in the last month and a half alone.
Cryptocurrencies have had these violent crashes before. What has been consistent is the recovery afterwards. There has not been a major crash where cryptocurrencies have not gone on to post higher highs. It is therefore highly likely that the same pattern will play out here. We just do not know when that will happen.
What do we do then? With all the blood in the streets it might be time to start buying DRIP. DRIP is certainly at a bargain price, so for those who want to grow their balance or who are hearing about DRIP for the first time, now might be a good time to buy DRIP and deposit it into the faucet for that 1% daily interest while waiting for the price to recover.
Elephant Money is another passive income play. The Elephant Money system has two tokens: its algorithmic stable coin TRUNK which can be staked for up to 205% APR and ELEPHANT, which is a reflections token that pays daily rewards to holders.
Elephant Money got a double whammy as it suffered an exploit then shortly after got hit by the market rout. The exploit caused TRUNK to lose its peg to the US dollar as the scammers stole over $11 million from the Elephant Treasury which is used to back TRUNK for it to maintain its peg. Market conditions exacerbated the effect of the exploit and although Elephant Money is back online — kudos to the developers — TRUNK is still below peg. One TRUNK is now worth $0.58 and ELEPHANT is down around 90% from its all-time high.
The price of these two tokens present compelling buying opportunities for those willing to take the risk. If TRUNK regains peg, that is an immediate 42% gain for those who purchase at current prices, in addition to the 205% APR paid on the token, one of the highest stable coin interest rates in the crypto market. The developers are working on strategies designed to get TRUNK back to peg. Reviving the project after the exploit shows the developers’ commitment to the project’s long-term success and is reason to believe they can restore TRUNK back to peg.
ELEPHANT had a great run prior to the exploit, with the token price rising exponentially in a short time. If the developers can rekindle confidence in the system, first by bringing back TRUNK to peg, it is not unreasonable to believe ELEPHANT could go on another bull run. The current price levels present a buying opportunity that could provide significant returns for investors.
Splassive is another passive income project that suffered the double whammy of an exploit and the market meltdown. Splassive is a DRIP clone on the Avalanche blockchain that pays 2% daily in SPLASH tokens, twice the rate that DRIP pays. Splassive launched in March 2022 but quickly suffered an exploit when a scammer was able to drain the contract using an airdrop vulnerability. Like Elephant Money, the developers were able to raise Splassive from the dead, but the price has failed to recover from the all-time high of over $50 achieved before the exploit. The price now sits at $1.85, a massive discount to the pre-exploit price.
Investors will naturally be skeptical of a project that was exploited, so the price drop was expected. However, the project has been back up for almost a month now and is consistently paying the 2%. At this low price, a modest purchase of SPLASH tokens deposited into the Splassive smart contract could turn into a whale account if the price recovers to near pre-exploit prices. Even a modest price increase could turn a small investment into decent income through compounding. Splassive’s 2% daily rate means that balances compound faster than DRIP. If the developers can keep the project safe from another exploit, those who SPLASH now could swimming in profits down the road. The project just needs to stick around.
Most investors find it hard to buy assets when prices are falling. In fact, they are more likely to sell and lock in their losses when prices fall. As prices rise the same investors will follow the herd and buy at soaring prices. The few who have the discipline to find underpriced assets with good fundamentals are likely to do better in the markets.
Not all low-priced assets are good investments, so you must do your due diligence to find projects that have good value and are sustainable. Investing in the right projects could juice portfolio returns. DRIP, Elephant Money and Splassive could become money printers if their prices recover from the lows. Even if prices remain low investors can still earn good long-term passive income as long as these smart contracts continue to operate as expected and pay the daily returns.
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This article is for information and educational purposes only, and nothing stated herein is to be construed as investment advice. Neither the author nor the publication takes any responsibility or liability for any investments, profits, or losses you may incur as a result of this information. Please do your own research and due diligence before making any investment decisions. The author has made every effort to ensure accuracy of the information in this article, but makes no representations or warranties, expressed or implied, to its accuracy, completeness, timeliness, or correctness. The author may own cryptocurrencies discussed in this article.