Taking Advantage Of The Coming Bull Run With The Tokenization Of The Real Estate Market
The 2021 crypto crash may have left the market in a years-long shambles, but there are definitive signs that new life is springing up among the wreckage. Bitcoin, the king of cryptocurrencies, finally shot out of its three year long plateau in the latter few months of 2023 and is looking poised to break out once again as the halving approaches in the first quarter of 2024.
Altcoins, meanwhile, have seen their own sudden leaps in value. Solana, Avalanche, Arbitrum, and other alternative options broke through their own multi-year doldrums in the final few months of the year and doubled, tripled, or even quintupled in value.
The technology sector built around cryptocurrencies has also been hard at work over the past few years, working to create value-added options that allow investors to use their hard-earned gains for active investments. Options like yield farming, liquidity pools, lending services, and staking all provide more active opportunities for using your resources to acquire more crypto without the need to spend more real-world currency.
The halving isn’t the only major upcoming event – the fed is expected to lower interest rates over the course of the next year, meaning lower borrowing costs for leveraged investors. While crypto is supposed to be insulated against the macro trends that affect traditional markets, the interest rate is a major contributor to investor sentiment and the amount of available money to be thrown at the crypto market.
With all of this in mind, what should a savvy crypto investor do to take advantage of the coming bull market? In our minds, it comes down to three primary steps: investing, financing, and consolidating.
The investing step is the actual process of finding cryptocurrency projects you like and believe in and buying them. While one can never go wrong with Bitcoin, there are lower ‘cap’ alternatives that have more room for growth, leading to a higher percentage return for investors with limited resources.
The key to this step is research. Finding projects and technologies that have potential and a good team behind them can take some time, but the monetary benefits are well worth the cost.
The financing step revolves around what you do with your investments in the waiting period after you buy them. While crypto can make you a fair bit of money just sitting in your wallet, it can be even more profitable to put the currency to work for you while you wait.
Finance options include activities like staking (a process that uses your crypto to validate nodes in the network in exchange for rewards), yield farming (providing liquidity into a ‘pool’ of different tokens in exchange for rewards), and lending. While these options can carry risks, they allow you to put your investments to work earning you more crypto in advance of the expected bull market.
Once the bull market has started and your investments have started to pay off, the joy of success will be sweet but shortlived; soon, the fear will begin to take hold. The crypto market is notoriously volatile, with wild swings occurring in the space of days or even hours. How can you protect yourself?
Consolidating your gains involves reinvesting them into more stable assets. While pulling your money out of the crypto market entirely is an option, there are plenty of on-chain options that present themselves as attractive and stable alternatives.
One of the best that we’ve found is using tokenized real-world assets. RWA tokens correspond to a certain percentage of the RWA’s value, so you can own a portion of something like bullion, art, antiques, and even real estate.
Considering real estate’s long-time reputation as the king of investments, many investors looking to consolidate their crypto gains will be interested in the marketplace’s associated RWA options like RealT Tokens. RealT, one of DeFi’s first real estate token providers, buys up rental properties, divvies up the value of the property in the form of tokens, and sells them to crypto investors. The token’s value is tied to the property value rather than crypto, ensuring the long term value of the investment.
Beyond just providing a safe haven for your crypto, RealT tokens also provide investors with passive real estate income in the form of rent. Each month, when renters pay RealT, the company distributes that rental income in equal proportion to the token holders. This means that whatever percentage of the property you own, you also receive that percentage of the rent.
The bull market is coming, and it’s best to prepare you plan for the entire course of the run. Invest now, finance during, and consolidate at its height. With these three steps, you can take full advantage of the massive gains to come!