Survival Guide for Bear Market: Three Cryptocurrency Profit Strategies That Doesn’t Rely on Markets

Original text: The DeFi Investor

Compiled by: Yuliya, PANews

Despite the recent sluggish performance of the cryptocurrency market, there are still profit opportunities in the market that do not rely on the rise in token prices. In fact, in addition to traditional traders and investors, there are many players who have achieved considerable returns in this field through other channels. This article will conduct in-depth analysis of three profit models that do not rely on market trends from the technical and strategic levels.

1. Airdrop and revenue farm

In the current DeFi ecosystem, the liquidity mining and airdrop mechanism with leading assets such as BTC, ETH, and SOL as the core is becoming increasingly perfect. Taking the Pendle protocol as an example, its smart contract supports stablecoin asset locking to obtain a fixed annualized rate of return (APY) of 19%, and a fixed annualized return of 12% for BTC assets. By optimizing strategy combination and capital utilization efficiency, professional operators can achieve 50-80% annualized returns on stablecoin.

2. Shorting arbitrage for high FDV new coins

 New tokens launched by Binance recently

Technical analysis of the newly launched tokens on Binance Exchange shows that most of the tokens show a significant downward trend after TGE . This market phenomenon mainly stems from two core factors:

• Tokens are severely decentralized : On-chain data shows that tens of thousands of tokens are issued every day
• Valuation system imbalance : Project parties tend to cash out early investors through high valuation model

As the market says, "There are often opportunities in chaos." This market inefficiency provides professional traders with significant short selling opportunities. The derivatives trading platform represented by Hyperliquid provides an effective trading channel for short-selling strategies by quickly launching a new currency perpetual contract. However, it should be noted that considering the high volatility characteristics of newly issued tokens, it is recommended to adopt a low leverage strategy to optimize the risk-to-return ratio and accumulate strategic experience through small-scale experiments.

3. Fund rate arbitrage (Delta neutral strategy)

In the pricing mechanism of the perpetual contract market, the capital fee rate serves as a cyclical settlement mechanism between long and short parties, providing arbitrageurs with significant profit margins.

• When the capital rate is positive, the long direction needs to pay the fee in the short direction;
• When the funding rate is negative, the short pays the long.

Professional traders can capture the fund rate spread by building a Delta neutral portfolio. At the specific operational level, when a significant positive capital rate is observed, a BTC spot long and a contract short position of $1,000 can be established at the same time (the capital rate can be monitored through the Coinglass platform), and stable returns can be obtained through market neutral strategies. .

At present, Ethena and Resolv and other agreements have developed automated fund rate arbitrage systems to provide users with passive benefits. However, by manually operating multi-variety arbitrage strategies, although time-consuming, they may still obtain higher returns. Investors can use the "Funding Comparison" functional section of the Hyperliquid platform to look for arbitrage opportunities.

Summarize

Even during the market downturn, there are still numerous opportunities in the cryptocurrency space. Contrary to general perception, there are still many invalid phenomena in the crypto market, which provides a rich profit margin for arbitrageurs. It is recommended that every participant should find a specific field that they are good at and can make profits, and continue to improve, and strive to become an expert in this field.