How A Crypto Market Crash Can Help You Build Long Term Generational Wealth
There’s no way to sugarcoat it. Crypto markets are having a difficult year — but there’s a silver lining. As with any financial market, a crypto crash can actually create opportunities to build long term generational wealth. You just need to understand how to leverage that opportunity.
After markets crash, it’s only a matter of time until they rebound and set new highs. In fact, it’s normal for crashes to take place regularly, approximately every 8 years, due to the natural cycles of the economy and business. However, each slump is followed by a recovery and then growth. For example, The Great Depression is actually just a tiny blip in the historical S&P 500 chart.
Investing during a market crash can be an excellent idea. It can help you capture more upside in the short term, giving you more funds to invest that will grow with compound interest. What does that mean? The upside in finance is referring to the possible rise in value, which is usually inevitable if you hold on to the investment for long enough. It might seem like a small difference in the short term, but years later, that investment will significantly boost your portfolio.
Assessing Your Risk Tolerance
Capitalizing on a market crash to build long-term generational wealth is all about your mindset. Now is an excellent time to reassess your risk tolerance and adjust your thinking.
First, ask yourself how financially dependent you are on your investments. If the answer is very, then you have to consider if a market crash could ruin you or put you and your family in too volatile of a situation. The higher the risk, the higher the potential reward, but also the potential loss.
You must accept that every investment cannot be successful, and it’s normal to see a loss. So ask yourself, what losses are you prepared to take? If you were to lose 5%, would you be okay? What about 25%?
Next ask yourself, how emotionally attached are you to your investments? When you become emotionally attached to a particular investment, it can become an obsession, which can cloud your judgment. This can be unhealthy for your stress levels as well as for your ability to make objective decisions. You may ignore money management rules by acting too impulsively. When you hear about negative information in the market, will you panic or will you be able to stay the course?
When it comes to investing, you need to put forth a plan and commit to that plan. Manage your risk, take your losses according to your investment plan, and preserve your capital so you can continue investing. This applies to both investing in the stock market and also investing in cryptocurrency. But like the stock market, there are riskier ways to invest in crypto and also safer ways to invest.
Centralized Cryptocurrency Exchanges vs. Decentralized Cryptocurrency wallets
Have you ever heard the expression, “Not your Keys, not your crypto”? Centralized cryptocurrency exchanges like Binance and Crypto.com are services that enable you to quickly exchange your fiat currency into cryptocurrencies. You can decide to keep your cryptocurrencies on these exchanges, but the risk here is that you are not the true owner of the crypto you purchase; the exchanges are. This has never been more clear with the FTX centralized exchange crash.
But don’t let the centralized FTX debacle put you off of all cryptocurrency!
There’s a vast difference between Centralized Cryptocurrency Exchanges vs. Decentralized Cryptocurrency wallets. The difference is that with decentralized crypto wallets, you and not someone else holds the keys to your investments.
Safeguard your crypto investments by choosing DEFI, AKA, Decentralized Finance. This is where you transfer your tokens to a decentralized wallet such as MetaMask.
What does this mean? It means that your tokens are in your control. This is where your web 3.0 & Decentralized Finance adventure can truly begin. For more details, watch the REX University video series.
How REX Can Help You Build Long-Term Generational Wealth
Part of building long-term generational wealth is diversifying your portfolio. On the stock market, many people do this by buying blue chip stocks or bonds. Bonds are time-based investments, where you lock up your money for a specific period of time (typically one year) to accrue interest.
The equivalent to blue chip stocks or bonds in crypto is REX, the world’s first staking token, which allows you to lock up tokens for some time in order to gain rewards.
Plus, REX provides a native Decentralized Exchange (DEX) for STAKES. Users may use the smart contract integrated functions to offer, buy, and sell STAKES without any restrictions, intermediaries, controllers, admins, or external services.
Participants buy REX and stake it over time to earn more REX. The additional REX earned by stakers comes from new REX, which is minted daily, increasing or inflating the REX supply over time. The REX token supply inflates by 12.9% per year. This inflation is created by the contract and distributed to the stakers. Also the REX community us developing a series of incredible deflationary additions to the ecosystem that will have a direct and positive impact on the price.
REX’s goal is to provide everyone with a simple, safe, and maximally flexible investment in cryptocurrency.
Investing in Crypto: The Bottom Line
Market crashes can be an excellent time to invest more money — just as long as you do it strategically. Buy low and decentralized with the intent of staying the course and eventually selling high much farther in the future. The longer you can keep your money invested, and the more diversified your portfolio, the more chances you have of building long-term generational wealth. REX is one of the best ways to accomplish this on both counts.
REX allows you to lock in your money so you aren’t tempted to panic and sell even during a crash, and REX offers appealing diversity from typical crypto investments. To learn more, visit rex.io.
We invite you to take the time to properly understand REX before investing. Some suggestions are below:
Do your own research
- If you are new to Crypto, please watch our Youtube REX UNIVERSITY series.
- Listen to the REX TALKS series with Thomas, the Creator of REX.
- READ THE WHITEPAPER! There is also a full walkthrough of the whitepaper here created by DR. Kelly Snook. Former NASA scientist and community member.
- Go through the links on the linktree.
- Read audit 1 and 2 and the hackathon report. These reports show that the code does exactly what is described in the whitepaper.
- You can also audit the code yourself. It is published here.
Meet the community
- Join us on youtube, twitter, and medium.
- Ask any questions in our telegram group, or discord server. Our community is always ready to engage and resolve any doubts or comments you may have.
- Reach out to firstname.lastname@example.org for partnership inquiries
Thank you for reading. Share this article with someone you love if you found it interesting. Learn more at Rex.io.