Investor As Service Provider: In A Rocky Market, How Can Traders Add Value?

The recent downturn in the market has left many investors spooked. 

Not long ago, Bitcoin BTC/USD, Ethereum ETH/USD and other altcoins were setting all-time-highs. BTC was nearing $70,000, ETH hit almost $5,000, and coins like Solana SOL/USD and Terra Luna LUNC/USD were on a tear.

But what goes up must come down.

Bitcoin is hovering just above $20,000, while ETH sits just above $1,000. SOL is just over $35 — about 14% of its all-time high. And this decline pales in comparison to the utter collapse of LUNC. Once worth almost $120, the coin is worth just fractions of a penny.

This instability has led to an exodus of institutional capital from the market. Several major funds have suspended withdrawals, and others teeter on the brink of insolvency. It is a dire time for cryptocurrencies. However, as the legendary Berkshire Hathaway Inc. (NYSE: BRK-A) Chairman and CEO Warren Buffet has said, be greedy when others are fearful.

The meteoric rise of crypto over the last decade and change has been accompanied by major crashes, and each time its critics have loudly stated the bubble had popped and crypto was finally on its way out. And each time they were proven wrong. The market came back stronger than ever. 

For those who maintain the faith, a bear market presents a massive opportunity for later profit. But how do you decide which projects are worthy? Which projects will stick around? Is there anything other than parking your money and hoping for the best that investors can do?

The creators of the new project called Seasonal Tokens believe they have created a system in which investors can expect some level of predictability and stability. And this stability comes largely from their active participation in the ecosystem.

Made up of four interrelated tokens — Summer SUMMER/USD, Autumn AUTUMN/USD, Winter WINTER/USD and Spring SPRING/USD — the project aims to create a system in which each token rises and falls in relative value. This allows savvy traders to consistently increase their amount of tokens over time.

Rather than being passive investors, however, the project relies on the traders to keep the economics functioning. Every nine months the difficulty of mining each token changes, with the least difficult becoming the most and visa versa. When this happens, investors with an eye toward the future can trade their more valuable tokens for a greater number of less valuable ones, allowing the miners to stay profitable.

Take, for instance, SPRING tokens. At one point they will be the easiest to produce, making them the least expensive of all the tokens. When the mining difficulty is raised, suddenly they are the hardest to produce and the least valuable. The miners, who need profits immediately, will rely on forward-thinking and active investors to trade their more valuable AUTUMN, WINTER or SUMMER tokens for the miners’ SPRING tokens. 

The investors benefit in the long term because eventually, the market will adjust to the increase in demand and SPRING tokens will become the most valuable.

This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.

Featured photo by Ibrahim Rifath on Unsplash