3 Crypto Tips From The Wolf Of Wall Street J. Belfort On How To Survive Crashing Markets

3 crypto tips from ‘The Wolf of Wall Street’ J. Belfort on how to survive crashing markets

3 Crypto Tips from 'The Wolf of Wall Street' J. Belfort on Surviving Crashing Markets

The cryptocurrency market is experiencing one of the longest downturns, with investors focusing on a possible price bottom. Amid the lingering market uncertainty, investors are also looking for ways to navigate the conditions in anticipation of a future rally.

Indeed, former stockbroker, commonly known as the “Wolf of Wall Street,” Jordan Belfort, previously shared tips on dealing with the market in phases of high volatility. So Finbold compiled the following key tips from Belfort on navigating the market correction:

Tip #1: Have a time horizon for Bitcoin of 3-4 years

The investor maintained that Bitcoin (BTC) is a long-term store of value and can generate returns after at least three years. According to Belfort, Bitcoin has strong fundamentals that make it more attractive in the long term. Notably, as reported by Finbold, Belfort claimed that Bitcoin is likely to continue to rise while admitting that he was wrong with his initial projection of the asset going back to zero.

“If you take a three, four or five year horizon, I’d be shocked that you haven’t made money because the underlying fundamentals, I believe, are very strong, and I think it’s just a matter of time that you know where enough of it gets into the right hands; there is a limited supply,” he said.

He believes that Bitcoin’s potential will be realized once the crypto sector is fully regulated.

Tip #2: Look no further than Bitcoin and Ethereum

With thousands of cryptocurrencies in existence, Belfort believes investor focus should be on Bitcoin and Ethereum (ETH), suggesting the two assets have strong underlying fundamentals. For Bitcoin, Belfort suggested that the limited supply and the rising acceptance curve are two key catalysts that could trigger a rally.

He notes that the asset has moved beyond a scam stating that the flagship cryptocurrency will survive the current market downturn, which he referred to as a ‘cleansing’. According to Belfort:

“Bitcoin is the type of thing that will survive this purge; it’s not going anywhere anytime soon. Case in point Ethereum very similar. It was the first crypto that actually had kind of broad use cases in terms of decentralized finance (DeFi) for people to build on top of other technologies. So you’ve got Ethereum there, which is also slaughtered, but if you’re long Ethereum, you know, and nothing’s a guarantee again, the odds are that it’s going to roar back over the next three to five years, the next bull cycle.”

However, he cautioned that apart from Bitcoin and Ethereum, most of the existing assets have yet to prove themselves, but acknowledged that some assets could survive.

Tip #3: Don’t panic

According to Belfort, with the cryptocurrency market grappling with widespread fear, investors should not panic and sell. He believes the current correction is a form of getting rid of bad assets. He suggested that money is made in such conditions, but investors should look for the right moment to get involved again.

“Right now you’re ready to panic and sell your Bitcoin and your Ethereum. I’ll never tell you what to do, but you need to take a deep breath and sober up about this, and don’t panic. The entire world of crypto is paralyzed by fear, so does that mean you should be out there buying in droves right now? Well, I’m not saying that, but I’m saying if you go back in history, those are the moments in time where typically the most money is made in the market right now,” Belfort said.

After reaching the highs in 2021, the crypto market corrected significantly in 2022, driven by various factors, including the prevailing macroeconomic conditions. Although the market tried to find a bottom for assets like Bitcoin, the FTX crypto exchange crisis eroded the gains after the trading platform was hit by a liquidity crisis amid allegations of misappropriation of client funds by Sam Bankman-Fried, chief executive.

The crisis arose after it was revealed that Bankman-Fried’s business empire consisted of two major entities – FTX crypto exchange and his trading firm Alameda Research. The relationship between the two entities was particularly considered unethically close, as Alameda’s financial data showed that its financial foundation mostly involved FTX’s native token, FTT.

As a result, the market wiped out more than $150 billion in capital, with the FTT token among the hardest hit assets. At one point, the token corrected more than 80% with about $2.5 billion in capital outflows.

Disclaimer: The content on this website should not be considered investment advice. Investing is speculative. When you invest, your capital is at risk.

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