Surviving the Crypto Bear Market: 5 Strategies for Success
In the last bear market, crypto was still in the discovery phase as users were wondering whether blockchain assets are a legitimate long-term trend or just a fad that should’ve been sold at the top. This time, the top industry players, including Microsoft, Google, and Reddit, are moving into Web3 products, and top banks such as JP Morgan and Franklin Templeton are testing the waters by settling transactions on-chain.
According to a report by Cointelegraph, the bitcoin has hit the 50,000 price recently.
Bear markets also bring uncertainty to builders. VC investment into Web3 startups has fallen to its lowest since 2020. However, bear markets come with an upside. They wash out the short-term arbitrageurs focused on money grabs and take crypto back to its roots — building a decentralized, secure and equitable future.
Steps to Tackle the Bear Market Blues
Get a clear understanding of your runway
– Check your treasury balance and extrapolate your costs for the next 12 months. Token treasury balances are volatile, so you may want to have enough dollar-denominated treasury to cover at least 12 months of cost.
– Make sure you understand your unit economics clearly and evaluate if your product can acquire new users profitably.
– If your project has a token, optimize it to conserve value.
– Try to get grants and support your runway. If your runway is less than 12 months, then don’t be shy in considering exploring a bridge round.
Talk to your community
– Communities are critical as they are the ones that will help you weather the storm. Your community is willing to test your v1 product and give you honest feedback so that you can iterate to PMF.
– The kind of community to go after depends on the type of product and the stage of growth.
– Don’t launch a token if you are still figuring out how to get to PMF. If you have PMF, then tokens could be used to incentivize and encourage fruitful participation of different entities within your ecosystem.
Verify if your product can acquire new users profitably..
Focus on your product’s value proposition
– Figure out your product’s core action and get your product in front of users.
– Bear markets are a good time to release early versions of your product to a small group of beta testers and gather feedback.
– On the other hand, if you have already attained PMF, your focus might shift towards scaling efforts such as communicating your value proposition clearly to users and optimizing marketing strategies.
Get your business model right
– In a bear market, it’s best to focus on profitability, reviewing expenses, and considering prioritizing investments that can drive profitable growth.
– Consider introducing premium offerings or testing new pricing strategies to maximize revenue.
– Think about ways to diversify your revenue streams.
Revisit your go-to-market strategy
– Be very conscious and targeted on how you spend money on marketing.
– Leverage organic and low-cost marketing strategies as much as possible.
– Think about what partnerships make sense for your product and who your target users are.
This is the moment to stay true to your vision and remember why you began in the first place. Bear markets may momentarily diminish your spirits, but they are the crucible in which the underlying foundations for revolutionary apps and innovative use cases are forged.
The information provided here is not investment, tax or financial advice. You should consult with a licensed professional for advice concerning your specific situation. The information contained in the column represents the views and opinions of the author alone and does not represent the views or opinions of the author’s employer or any 3rd party affiliated with the author.
Source: Polygon Ventures
This article was published through Cointelegraph Innovation Circle, a vetted organization of senior executives and experts in the blockchain technology industry who are building the future through the power of connections, collaboration and thought leadership. Opinions expressed do not necessarily reflect those of Cointelegraph.
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