We have of course tricked you a bit with this title, because in principle no cryptocurrency is resistant to bear markets. Even the big one bitcoin has already lost more than 70 percent from the all-time high of November 2021. That does not alter the fact that there are certain coins that will most likely always outperform the rest in difficult times.
Which cryptos are they?
In principle, you can say that the larger the market cap, or market capitalization, of a currency, the more resistant it is to bear markets. A larger market cap often means more liquidity, which means that, for example, the price of BTC relatively less corrects during bear markets than the price of a small altcoin. If you want to defend yourself against potential bear markets, it is important to be in large currencies as much as possible.
Even after a good 13 years, bitcoin is still king of the market and ethereum has to double in market cap to reach the level of bitcoin. It should therefore come as no surprise that Bitcoin often outperforms all other currencies during bear markets. Only in the stablecoins you are safer, but that is of course not really an investment. Unless you choose to put your stablecoins to work on the major exchanges.
Besides bitcoin is also allowed ethereum increasingly qualifying as a currency resilient to bear markets. After the transition to Proof-of-Stake, the institutional public is also increasingly targeting ether. This is evident, among other things, from the fact that Fidelity is abandoning its bitcoin-only policy and will soon also be offering ether to its institutional clientele.
This bear market, stablecoins have proven to be the best means of defending yourself against a crypto winter. That in itself is not surprising, given that you are of course in fiat money and if the rates fall, then that is the best place to hide yourself. What is extra interesting is that you can also catch interest on these stablecoins at exchanges such as Binance.
You will receive about the first $1,000 of Binance USD (BUSD) and Tether USD (USDT) at Binance for example, 8 percent interest on an annual basis. After the first $ 1,000, this percentage already drops to 0.8 percent, but it remains a decent return. There is of course a risk involved, but in the bear market that can certainly be interesting.