On the 19th of August, Bitcoin dropped more than 10% in one day, opening at $23,000 and closing below $21,000. This broke the micro trend of higher highs and higher lows. Bitcoin fell out of its wedge and shocked the market, which had been increasingly bullish. Altcoins suffered more pain retracing by more than 30% in several cases. The Fear and Greed Index now displays 29 (Fear), significantly lower than last week when it showed 45 (Neutral).
The central question is how can investors protect themselves against these sudden market crashes? The answer is simple, by changing their investment style and horizon. Crypto investors who have survived multiple market cycles take the inverse approach to newer investors. When the market drops, they are happy instead of panicked because it means they can pick up more crypto at discount prices.
Another critical factor is investing in projects with enduring value propositions. Investors should search for projects that add real value to the digital asset space. This article features three crypto projects, Gnox (GNOX), Bitcoin (BTC), and Binance Coin (BNB), to help protect market participants from sudden market crashes.
Gnox is a brand new reflection token that launched on the Binance Smart Chain and has already attracted the interest of crypto analysts due to its mechanics. Gnox provides passive income to its investors through the use of a treasury that is funded via buy and sell taxes. This treasury earns for investors in DeFi, and GNOX holders receive an hourly distribution of BUSD and a monthly dividend of BUSD.
With only the interest payment being distributed, the principal sum of the treasury remains untouched and continues to grow and increase its earning capacity. According to analysts, this is the takeaway point as it means Gnox reflections will continue to increase with time, making it an excellent long-term hold.
Bitcoin continues to follow its four-year cycle behaviour. Currently trading at $21,000, this is the accumulation phase of a lifetime. With the increased interest from institutional investors and nation-states, the days of ordinary investors owning a sizeable stack of Bitcoin will soon disappear.
Bitcoin always rallies again, and people kick themselves for not buying more. Investors who can escape FOMO buying at the peaks and instead buy at these prices will be amply rewarded in the next bull market cycle.
Binance Coin (BNB)
Binance is the world’s leading exchange ranked by volume, the Binance Smart Chain is the third largest ecosystem within DeFi (decentralised finance), and BNB is token at the heart of these vast infrastructures. With a market cap of nearly $50 billion, BNB sits in the top five crypto projects, and as a token that adds such value to the sphere, it is one of the safest investments investors can make.
To protect against sudden market crashes, invest in projects that provide genuine value to the sphere. Projects with a solid value proposition will always appreciate, whereas projects driven by hype suffer the most from market swings. Gnox provides a simple investment vehicle for DeFi, Bitcoin stores value, and BNB powers the Binance ecosystem. All three are excellent choices to hedge against market downturns.
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