Guide to the "Crypto Winter": Streamline Your Portfolio and Invest in Resilient Teams
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Guide to the "Crypto Winter": Streamline Your Portfolio and Invest in Resilient Teams
Many cryptocurrency observers see this sharp decline as a short-term market correction rather than a sign of a year-long free fall. But even so, it might now be time to put on winter coats and wait for spring to arrive.
Navigating Web3 tides with focused insightsOriginal title: A Survivor’s Guide to Braving the Crypto Winter
By The Information
Compiled by 0xbread TechFlow
Spurred by investor concerns over rising interest rates and drying liquidity, cryptocurrency prices plummeted this week, erasing $1 trillion from the market since Bitcoin's all-time high in November. This crash has reminded crypto diehards of 2018—the last time the industry entered a "crypto winter." A "crypto winter" informally refers to a sharp decline in cryptocurrency prices followed by a prolonged period of reduced trading activity.
Many crypto observers view this downturn as a short-term market correction rather than the beginning of a year-long freefall. Still, it might now be time to bundle up and wait for spring.
So, what’s the good news?
OhhShiny, an influencer and investor in the NFT space, said: “NFTs were born out of crypto winter—Dapper Labs came from it, Axie Infinity came from it.” In other words, sustained downturns may actually be a blessing in disguise for the crypto ecosystem—a time when innovation increases and Grimacecoin (slang for meme/shitcoins) decreases.
However, newcomers to crypto may be experiencing some “minor frostbite.” Douglas Boneparth, a registered financial planner and founder of Crypto Drip coffee company, says people are now learning “what kind of game they’re actually playing.” So if you’re watching the market with panic, brace yourself and consider these expert tips on surviving the crypto winter:
1. Take a deep breath—this winter (might) be different
The crypto world is always haunted by past winters—especially 2018, when crypto prices crashed and mockery poured in. At that point in crypto’s brief history, morale hit rock bottom. But Emm, chief marketing officer of the NFT project Crypto.Chicks, finds comfort in how far the industry has come since then. She said: “Blockchain and cryptocurrency now have more real-world applications. As people truly understand these technologies applied in the real world, they become more tangible and viable. The possibility of everything collapsing to zero—at least in my view—we’ve already passed that stage.”
Boneparth said: “People who entered the space around last year might be feeling pain now, but ‘keeping those emotions in check is crucial’ when making long-term investments. You can’t control Bitcoin’s price. So keep your head down, focus on doing things that earn money or bring you joy.”
Alexa von Tobel, managing partner at Inspired Capital, agrees, encouraging people to treat their crypto investments as long-term commitments. She said: “Trading in and out of asset classes isn’t just tax-inefficient—it also rarely works well in terms of timing. It’s highly unlikely you’ll sell high and then buy back low.”
She added: “If you’re not emotionally prepared to buy something and hold it, your situation could actually get worse.”
2. Consider going on a wild “shopping” spree
What’s one silver lining of the current market slump? Most cryptocurrencies are cheaper now than they’ve been in a year. If you’ve been waiting to buy Bitcoin or Ethereum, now might be the time to buy the dip. As Alexa von Tobel puts it: “When markets get turbulent, it’s time to go ‘shopping.’”
Of course, there are caveats. Von Tobel stresses that your financial health shouldn’t depend on your crypto holdings—retirement savings should come first. And if you do invest, be ready for a bumpy ride. “I believe if you fundamentally believe an asset will be the right one over the next decade, you can accept the volatility that comes with buying and holding it,” she said.
3. Streamline your portfolio
In bull markets, even half-baked projects can thrive. But in winter, as investors shift toward safer bets, confidence in crypto and other blockchain projects wanes. This is precisely the moment to review your portfolio and assess which investments are truly long-term.
OhhShiny said: “If you’re focused on collections or collectibles whose only merit is high prices or speculation about high prices—those are the first things I’d cut.”
OhhShiny sees blockchain gaming as a “standout sector,” noting games like Gods Unchained continue growing regardless of Ethereum’s price. “Personally, whether this downturn is brief or not, if you look at macro trends, it seems consumers will have less disposable capital in the future (say, a year and a half or two years from now). Projects with long-term, real-world utility—non-purely speculative ones—are the ones worth betting on.”
4. Bet on resilient teams
Emm said now is the time to support teams that will stick with their projects even when “things get tough.” She looks for creators active on Twitter Spaces or within their project’s Discord—she cited Women Tribe and Alpha Girls Club as projects prioritizing organic growth. She remains cautious about projects inflating their Discord members and Twitter followers with “spammy giveaways.” “That’s a red flag for me,” she said, “when evaluating the legitimacy of founding teams: Are they trying to pivot and build something sustainable long-term, or are they completely anonymous and ready to rug-pull?”
5. Find your crew
Going through winter alone isn’t fun. The best way to stay sane during a down market is to hunker down with like-minded people. OhhShiny said: “If you don’t explore the community—whether diving into Discord channels or listening in on Clubhouse rooms and Twitter Spaces—you won’t truly grasp the industry’s potential. Even during the doldrums of winter, you can have a deeply enriching experience.” OhhShiny recommended several projects: Doodles for new profile pictures, Quantum Art for art lovers, and Eve Wealth for women interested in investing.
OhhShiny’s words indeed make the crypto winter sound a bit cozier. Minutes after our interview ended, he added more advice on Twitter: “Build a pillow fort with blankets, pillows, and couch cushions. Bring your two best friends into the fort and discuss ideas. Co-create a company inside that fort and stick with it until winter ends.” Maybe the real gift of the crypto winter is the friends you make along the way.
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