The last few months have been a tumultuous time for the cryptocurrency market with the vast majority of digital assets losing between 20% and 50% of their value in the last three months before recovering again.
As you might expect, this has made it far more difficult to find and secure profitable investments without taking on considerable risk at the same time.
But all hope isn’t lost. While the vast majority of cryptocurrency holders are likely struggling right now, we’ve whipped up three ways you can buck the trend and make the most of your funds during a temporarily weak market.
Start Yield Farming
If you haven’t already started yield farming, now might be a good time to get involved. As the name suggests, yield farming involves using cryptocurrencies to “farm yields”. That is, they are used to accumulate a profit from one or more platforms.
Yield farming platforms have exploded in popularity in recent months since they provide a way to securely earn a yield without needing to speculate on the price of a token or incur risks by trading. Because of this, yield farming is accessible to even inexperienced cryptocurrency holders looking to turn a reliable yield on their idle assets.
Though there are a number of platforms that offer this functionality, YeFi.one has recently been picking up momentum as a suitable option for both beginners and experienced users. It looks to offer a comprehensive DeFi ecosystem and yield farming solution.
The platform is designed to make getting involved in yield farming as simple as possible by providing an easy-to-access staking platform through which users can stake assets and earn an impressive yield. The platform is unusual among yield farming options in that it has been comprehensively audited by two prominent blockchain security firms (Certik and Beosin) and allows interest to be withdrawn at any time.
YeFi’s yield farm app is currently up and running on Binance Smart Chain (BSC), but there are plans to expand to other blockchains in the near future — as well as add on additional DeFi features, including decentralized lending, borrowing, and trading.
Join An Initial DEX Offering (IDO)
If you haven’t participated in an initial DEX offering (IDO) yet, then you may be missing out on one of the most lucrative investment avenues this year.
Over the last year, experienced investors and those in-the-know have been gaining access to some of the most promising blockchain-powered projects prior to their public launch via IDOs. As the name suggests, the practice is somewhat similar to an initial coin offering (ICO) in that tokens in pre-launch projects are sold at favorable rates. But IDOs are instead offered in a decentralized format securely handled by smart contracts.
According to data from CryptoRank, the average return on investment (ROI) stands at well over 200% for IDOs hosted by BSCPad, Polkastarter, Zendit, and DAO Maker. However, not all IDO launchpads are built equal so it’s important to do your due diligence — both on the launchpad platform and the IDO project itself — before getting involved.
Although most IDO launchpads currently focus on Ethereum-based projects, new options like Infinity Pad are now looking to support promising projects launching on Binance Smart Chain.
The platform is uncommon among IDO launchpads in that it is equipped to incubate selected projects to maximize their chance at success. It includes a reward vault to incentivize IPAD stakes, and will be perhaps the only known launchpad to offer a fiat on-ramp — making it accessible to those looking to invest with their credit or debit card.
Participate in a Crypto Fund
If you’ve struggled to successfully identify profitable trading opportunities or simply don’t have the time to dedicate to scoping out new prospects, consider participating in a crypto fund instead.
Much like traditional venture funds and hedge funds, these platforms are dedicated to securing attractive investments on behalf of their customers through a pooled fund or investment product. In essence, they’re designed to manage your money for you with the sole purpose of helping you turn a profit.
Depending on the type of fund, these investments may be manually managed by a dedicated fund manager and team of market analysts or automatically executed using an algorithmic or A.I-powered strategy. Likewise, the risk profiles of the investments offered can vary considerably between platforms, with some favoring high risk/high reward options, others favoring low risk and low reward, while most will offer a mix of both.
There are now dozens of platforms that offer exposure to digital assets, many of which are actively taking on new clients. As it stands, Grayscale Investments and Pantera Capital are the largest funds by assets under management (AUM). While a number of more niche funds are beginning to appear in recent months — including Master Ventures’ Dot Fund (focused on the Polkadot ecosystem).
As with all investments, it’s important to do your due diligence before investing with any fund. Paying particular attention to their recent and historic performance, investment strategy, reputation, and fee schedule to ensure it aligns with your expectations.