Chapter 14
Ten (or So) Tips for When the Market Dips
IN THIS CHAPTER
Preparing for market downturns
Crafting plans to withstand market dips
Understanding relative cryptocurrency market volatility
Calculating burn rate and runway
Understanding when it makes sense to stop mining
Pondering buying the dip
Because the cryptocurrency space is so immature, incredible volatility in the exchange rate of Bitcoin and other cryptocurrencies has occurred, along with rapid appreciations in asset prices and huge crashes.
There are two basic arguments for why this volatility happens. The skeptic will say that cryptocurrencies have no inherent value, any more than tulips have an inherent value that justified the Tulipmania of early 17th century Holland, during which tulip bulbs reached astronomical prices. (Tulip bulbs were selling for as much as 1,000 pounds of cheese, or 12 fattened sheep.) No, ...
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