This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.
Just three years ago the total market capitalization of cryptocurrencies was $230 billion; today that number is north of $2 trillion.
As more and more investors pour into the market, the rapid growth is expected to continue. According to a report by the investment management firm ARK Invest, the market capitalization of Bitcoin (CRYPTO: BTC) in 2030 could be greater by a factor of 20.
This optimistic future has brought thousands of investors hoping to grow their wealth. However, as many that have been in the market for years will attest, it's not always easy to make money. Many might lose a significant amount.
This is true of any market, but it is arguably even more so in crypto. Wild price swings that dwarf those of traditional equities markets can often be the norm. This is especially true when dealing with alternatives to the dominant BTC and Ethereum (CRYPTO: ETH). Coins like Solana (CRYPTO: SOL), Terra Luna (CRYPTO: LUNA) or Cardano (CRYPTO: ADA) can gain and lose more than 10% in a day. And at the height of the Dogecoin (CRYPTO: DOGE) mania of last year, the meme coin gained more than 110% in a single day.
This volatility is a double-edged sword. If played right, traders can profit hand over fist. If played wrong, trading accounts can evaporate quickly.
The Seasonal Tokens project says it hopes to provide an ecosystem in which traders can more reliably profit. The tokens – Summer (CRYPTO: SUMMER), Autumn (CRYPTO: AUTUMN), Winter (CRYPTO: WINTER) and Spring (CRYPTO: SPRING) – are designed to rise and fall in price in a predictable manner. As one token begins to appreciate, the others fall relative to it.
Investors can trade from WINTER into SPRING when there is the greatest difference in price, then into SUMMER and AUTUMN. In this way, in theory, both the quantity of tokens a trader owns and their value increase.
As investors choose to trade in and out of the ecosystem into other coins, however, these gradual price changes designed by the project accelerate. Prices could fluctuate more sharply and behave differently than intended.
But this might present an opportunity for others in the ecosystem to restore the coins’ value by buying it from those selling out and profiting in the process. The project’s creators hope that this can enable a virtuous cycle where those invested in the ecosystem maintain its health.
If you are interested in learning more, check out https://seasonaltokens.org/.
This post contains sponsored advertising content. This content is for informational purposes only and is not intended to be investing advice.
Photo by Jason Briscoe on Unsplash
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.