YouTube video (Ben Simpson) presenting a five-step reassessment framework to decide whether to sell, hold, or buy more altcoins. The framework asks whether the project still solves a real problem, whether the team is still building, if tokenomics are aligned, whether there is real traction or hype, and includes tax considerations (notably Australian tax-loss harvesting). The speaker also recommends asking personal questions (would you buy it again today; are you emotionally attached) and highlights the steep returns required to recover large drawdowns.
If you are not sure whether to hold, buy more or sell your cryptocurrencies, there might be those altcoins that are down, you don't know what to do with them. Here's my five step framework to help you make the right decision and not hold on to when you could be buying something else right now and making all the gains the next few months. Check this out.
This is my five step reassessment framework. So number one, is it still solving a real problem? Like is there something actually that the world needs that your cryptocurrency is creating? Number two, is the team still building? That's a big one. A lot of teams, once the price goes down, just gives up and lets it die. Is the tokenomics intact? Like is the project actually creating something that is aligned and still like building something? A lot of projects have a good product, but their tokenomics don't actually do anything, which means the price will never go up. Is there actual real traction or hype? Like is there a community behind it? Creating content on social media? And is the narrative so relevant? Like do you think there will be some sort of hype around the project in the future? Another three questions you can ask yourself that will help. Would you buy it again today? If you had no emotional attachment, Would you confidently buy it again today? Are you stuck in it just because you've been in there for so long? And are you emotionally attached? Are you actually there because you like it versus logically? Just remember recovering from losses, it takes a so much higher return to get back to break even. If it's down 80%, it's going to get 400%. If it's down 90% it's going to go up 900%. Last but not least, do think about tax. When selling in Australia, you can look to tax loss harvesting. If you offset those losses against future capital gains, that's really, really important.
I know it could be hard to understand whether or not to sell or buy the coin. Sometimes buying more will bring down the average buy price and that will give you the most returns in the future. Sometimes your altcoin just might be dead in the water. So make sure you make the right decision because I do believe in the coming months the market's going to return and you want to be prepared.
