What can realistically happen
- Author
- CRYPTO PORT Editorial
- Published
- Updated
- Reading time
- 6 min
In short
Crypto prices move sharply in both directions, and can stay below what you paid for a long time. Rather than planning around a rise, work out in advance what your position looks like if the price falls and does not come back. This site offers no view on future prices.
Key points
- Moves of tens of percent in a day occur, and there is no floor on the downside
- Prices have stayed below earlier purchase levels for years at a time
- Past price behaviour tells you nothing about future price behaviour
- 'It always comes back' has no basis
Definition
A plain account of how the price of a holding can behave, and what that leaves you with, written without assuming it goes up.
Crypto prices move far more than most financial products. Daily moves above ten percent are unremarkable, and there have been repeated episodes of prices halving in a short span. Coverage clusters around the rises and thins out during the long declines, so the overall impression most people form is milder than the record.
The scenario to plan for is buying, watching the price fall, and then sitting below your purchase level for years. Selling locks in the loss; holding means carrying it while watching the price daily. Both are uncomfortable, but the more important point is that the money is unavailable for anything else in the meantime. If it was money you needed for living costs or a near-term plan, you can be forced to sell at a loss precisely because you need it.
Assets can also shrink for reasons unrelated to price: an exchange suspending withdrawals, a mistaken transfer, a phishing site that takes your private key, or an asset being delisted. None of these depend on the market, and all of them can happen while you do nothing at all.
This site does not forecast how any crypto asset will move. It says neither up nor down. What it can offer as input is the fact that the range of movement is wide, and the fact that no mechanism exists to restore what you lose.
Watch out for
- · Past movement cannot be used to predict future movement
- · 'Hold long enough and you will be rewarded' has no basis
- · A fall in price can cost you everything you paid
Frequently asked questions
How far can it fall?
There is no floor. Some assets have been delisted and ended up effectively worthless. Nothing guarantees that a decline stops at any particular level.