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Good Morning Switchers 🤗
👋Welcome to Switch Daily.
Remember the ‘Rich Dad, Poor Dad’ author, Robert Kiyosaki? Yeah, that guy. So, he recently talked about the FTX fiasco, pitching his two cents on the issue (of course he has an opinion, but so does Seema aunty.)
While discussing the crypto market crash on the Rich Dad Radio Show, Kiyosaki said that he is still bullish on Bitcoin despite everything. He asserted that “Bitcoin is not the same as Sam Bankman-Fried. It’s not Bitcoin, it’s FTX that’s the problem.” (Sick burn)
BTW, if you like reading this newsletter, give us a shout out on Twitter and get your friends to subscribe. It will mean a great deal to us!
Here’s what we’ve got for you:
Market pulse
Right time to buy a token
Frizzy News
Meme of the day
Market pulse 📈
The market is like a flat mat
The crypto market moved on the expected lines over the weekend and was range-bound. Trading volume was on the lower side, with BTC moving within the $500 range, avoiding the sub-$16,000 level. The Fear & Greed Index improved significantly to reach 28/100 level, showcasing improving investor confidence. DOGE is the top gainer among top-10 cryptos over the seven days and is up by 27%.
When is the right time to buy a token? 💰
Okay, the market is showing signs of moving on from the FTX crash. The charts look healthier, and hope is peeping through your wallets.
What do you do next?
Maybe you are contemplating buying some tokens or want to do nothing.
Either way, here’s a little pocket guide to help you decide when is the best time to invest in any token. By the end of this guide, you will have a pretty good idea of which tokens are worth investing in and at what stage.
Step 1: Look for the token’s fundamentals and utility.
The token you want to buy must have strong fundamentals like a reliable team, market share, adoption, etc. If you want to learn more about fundamental analysis for crypto, check this out.
This is the most crucial criterion to tick off before moving on to the rest. If yes, great; if not, the token may not be worth investing in.
Step 2: Determine the token’s market phase.
There are 4 phases any token should go through:
Speculative phase - Speculators and insiders invest
Retail phase - The general public start investing
Sell-out phase - Early investors sell out
Accumulation phase - The token is settled in, and speculation dies out.
Let’s take a look at MATIC’s chart to understand these phases.
Okay, so at which phase should you buy the token?
That depends. There is no harm in investing in a token during any of these four phases, but how much exposure you are willing to take is what matters.
🟡During the speculative phase, the project is still finding its ground. Only a few people leap and invest in it. If you believe in a project, you can consider investing in this phase. But there is extreme risk involved since the project is fairly new at this stage, and you cannot predict how the market will behave.
🟠The retail phase is when the public discovers the project and starts investing in the token. Here, the token price can see a massive surge coz of adoption. There are chances to make good gains in this zone, but you should know when to exit.
🔴The next phase—the sell-off phase is a bad one. The early investors and VCs start to offload their holdings, and the chart comes crashing down. May not be a great time to buy if you want to hold longer. However, the risk is always much higher when compared to rewards at this stage.
🟢Beyond this point, the token should start settling in. Legitimate investors start accumulating the token, and the price does not swing erratically. You will notice that the chart is more or less horizontal at this phase. This may be the best time to enter the market. The risk-to-reward ratio is fairly high; by now, you know that the token is not a spoof coin.
Here’s the thing, sometimes the coin may stay in the accumulation phase for a long time. But if you have chosen a token with good fundamentals, this shouldn’t be worrying. You can chart out how much you want to invest and in what time frame based on the following:
How much capital can you afford to invest?
What is your risk tolerance level?
How long are you willing to hold?
There is no one size fits all strategy for determining when to buy a token. You must consider all the above factors and make an informed decision.
TLDR;
Find a coin with strong fundamentals.
Identify the market phase of the token.
Ideally, investing in a token that has gone through the first three phases and is now settling in the accumulation phase is good.
Note: We’re not financial advisors; this is not financial advice. We’re just your fellow investors sharing the gyan we got based on our experience.
Community Spotlight 💡
More power to Women who BUIDL! 💪
The Phoenix guild is a group of women and non binary folks who have come together to create a diverse and inclusive web3 ecosystem and want to help other women in tech and non-tech roles empower and educate themselves to utilize the opportunities in WEB3.
So, if you are a woman and want to transition to Web3, you know where to look.
What’s making the headlines? 📰
The Russian President, Vladimir Putin criticized Western sanctions and urged for a system "independent of external interference". Putin also noted that global payments and nations are at risk due to tense relations between Russia and the West following Ukraine's invasion, labeling sanctions imposed by countries as "illegitimate restrictions".
El Salvador’s government has created a National Bitcoin Office (ONBTC). The new office is meant to manage “all projects related to the cryptocurrency” and it was established in Decree No. 49 by the Salvadoran president Nayib Bukele.
Web3 game publisher Fenix Games raised $150 million in funding to acquire, invest and distribute blockchain games. The fund will be used to create a game publishing company specifically for mainstreaming blockchain games.
Meme of the day!
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See you tomorrow, folks. 👋
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