The saying goes that we should not catch a knife that is falling. Even trying to aim for the handle, the chance of your fingers closing on the blade is high — and what should be just a flatware on the floor becomes a visit to the doctor. And this same maxim applies to the recent fall in cryptocurrencies.
O bitcoin it even dropped more than 30% in the last seven days and touched important supports that left investors standing on end. Trying to hit the best time to buy can be risky at this point.
But even with the drops, there are investment classes within the crypto market that are really discounted in relation to the quality of projects, as Felipe Fernandez, cryptocurrency analyst at VG Research.
These are decentralized finance (decentralized financeor simply DeFi), lending protocols within the cryptocurrency network, which “already got more than they should” in Fernandez’s opinion.
“DeFi has suffered a lot in recent months. Great projects devalued 80%, almost 90%, now we are talking about a 900% upside potential”, comments the analyst at VG Reserach. He cites promising examples like Uniswap (UNI) and Aave (AAVE), which have already dropped 78.2% and 77.6%, respectively, since the start of 2022.
Press play and check out the latest full Crypto Chat here:
It is true that, in order to know if your money is being allocated to a good investment, it is necessary to know the bases that support that thesis.
Whether for the earning potential of cryptocurrencies or the security of fixed income, they are the ones that suit your profile as an investor.
However, will the fundamentals be enough to explain the drop of 55% in 2022 and 69% since the all-time highs?
“I, like other analysts, am very bullish because of fundamentals. Perhaps the unwillingness to remain in this market is because its exposure to these types of assets is greater than its accepted risk profile”
And what to do now? To learn how to face the difficult time of cryptocurrencies, see the full interview with Felipe Fernandez, cryptocurrency analyst at VG Research, in this week’s Cripto Chat. Play!