logo
    • Buy Crypto
    • Markets
    • Futures
    • Spot
    • Earn
    • Affiliates & AI
    • More
    1. WEEX
    2. Crypto News
    3. From 30% Profit to Losing It All: Beware of the "Greed Trap" in the Crypto Bear Market

    From 30% Profit to Losing It All: Beware of the "Greed Trap" in the Crypto Bear Market

    By: blockbeats|2025/04/07 09:00:03
    0
    Share
    copy
    Prefer us on GooglePrefer us on Google
    BillionBillion
    SurviveSurvive
    THISTHIS
    YieldYield
    MANYMANY
     
    Original Article Title: How to survive a bear market in DeFi market neutral
    Original Article Author: Santisa, Crypto KOL
    Original Article Translation: Felix, PANews

    Before delving into the content of this article, let's first consider the following story (or perhaps reality).

    An "endless" tariff list is announced. Subsequently, the market crashes, and meme coins collapse.

    Your original low-risk "mining farm" yield drops from 30% to nearly Treasury bill levels.

    This is unacceptable to you. You had planned to retire with $300,000, earning $90,000 annually from "mining." Therefore, the yield had to be high.

    So, you start exploring down the risk curve, chasing an imagined level of yield as if the market would favor you.

    You swapped blue-chip projects for unknown new projects; you increased your yield by deploying assets to high-risk new fixed-term protocols or AMMs. You started feeling smug.

    Weeks later, you begin to question why you had been so risk-averse in the first place. It was clearly a "safe and reliable" way to make money.

    Then, a surprise comes.

    From 30% Profit to Losing It All: Beware of the

    The ultra-liquid infrastructure trading project you entrusted your life savings to, custody, leverage, L2-wrapped, collapses, and now your PT-shitUSD-27AUG2025 has lost 70%. You received some airdropped governance tokens, only for the project to be abandoned months later.

    While this story is exaggerated, it reflects the reality that unfolds repeatedly during a bear market when yields are compressed. Based on this, this article will attempt to provide a survival manual for the yield bear market.

    People strive to adapt to the new reality, facing market crashes, they increase risk to compensate for the yield shortfall while ignoring the potential costs of these decisions.

    Market-neutral investors are also speculators, with their advantage lying in finding unadjusted rates. Unlike their directional trading counterparts, these speculators face only two outcomes: either making a little profit every day or losing a substantial amount in one go.

    Personally, I believe that crypto market-neutral rates become severely mismatched during an uptrend, offering alpha higher than their true risk, but conversely during a downtrend, they provide returns lower than the risk-free rate (RFR) while taking on a significant amount of risk.

    Clearly, sometimes you need to take risks, and sometimes you need to mitigate risks. Those who fail to see this will become someone else's "Thanksgiving dinner".

    For example, at the time of writing this article, AAVE's USDC yield is 2.7%, and sUSD's yield is 4.5%.

    · AAVE USDC bears 60% of the RFR while also bearing smart contract, oracle, custody, and financial risks.

    · Maker, while bearing smart contract and custody risks and actively investing in higher-risk projects, bears a fee of 25 basis points above the RFR.

    When analyzing the interest rate of a neutral investment in the DeFi market, you need to consider:

    · Custodial risk

    · Financial risk

    · Smart contract risk

    · Risk-free rate

    You can assign an annual risk percentage to each type of risk, then add the RFR to determine the "risk-adjusted return" required for each investment opportunity. Anything above this rate is considered alpha, while anything below is not alpha.

    A recent calculation found that Maker's risk-adjusted required return is 9.56% for a fair compensation.

    Maker's current rate is approximately 4.5%.

    Both AAVE and Maker hold Tier 2 capital (about 1% of total deposits), but even with substantial insurance, depositors should not accept yields below the RFR.

    In the era of Blackroll T-bills and regulated on-chain issuers, this is the consequence of lethargy, key loss, and foolish capital.

    So what should you do? It depends on your scale.

    If your portfolio scale is small (less than $5 million), there are still attractive options. Check out protocols that are more secure in all chain deployments; they often provide incentives on some lesser-known chains with lower TVL or engage in basic trading on high-yield, low-liquidity perpetuals.

    If you have a large amount of capital (over $20 million):

    Buy short-term Treasury bills and wait for things to evolve. The favorable market conditions will eventually return. You can also look into OTC trading; many projects are still looking for TVL and are willing to significantly dilute their holders.

    If you have LP, let them know, even let them exit. The on-chain treasury bond is still below the real trade. Don't let the untuned risk-return ratio cloud your judgment. Good opportunities are obvious. Keep it simple, avoid greed. You should stay here for the long term, manage your risk-return properly; if not, the market will take care of it for you.

    Related Reading: Comprehensive Data Analysis: Where Did the Funds Flow Behind the $100 Billion Growth of Stablecoins? Shitcoins didn't rise, where did the money go?

    Original Article Link

    -- Price

    --

    This content is provided for general informational purposes only and doesn't constitute financial, investment, legal, or tax advice. Any events, rewards, online promotions, or related information mentioned herein should not be considered a recommendation, solicitation, or invitation to purchase, sell, trade, or otherwise deal in any crypto assets. Crypto assets are highly volatile and may result in loss. The availability of WEEX services, products, and related events may vary by region. You are responsible for ensuring that your participation is in accordance with applicable local laws and regulations.

    You may also like

    Cryptocurrencies Make Their Way in Latin America Amid Regulatory Gaps and Controversies

    Cryptocurrencies Make Their Way in Latin America Amid Regulatory Gaps and Controversies

    Who Really Captures Crypto Revenues?

    Who Really Captures Crypto Revenues?

    Google and Ryanair Sign Five-Year Cloud and AI Agreement

    Google and Ryanair Sign Five-Year Cloud and AI Agreement

    Google Pixel 11 Released: Minor Hardware Changes, Major Gemini Features

    Google Pixel 11 Released: Minor Hardware Changes, Major Gemini Features

    How to Use Dune: Dashboards That Help Cryptocurrency Investors

    How to Use Dune: Dashboards That Help Cryptocurrency Investors

    Crypto and Tokenized Stocks: The SEC's Major Shift Becomes Clearer

    Crypto and Tokenized Stocks: The SEC's Major Shift Becomes Clearer

    The SEC is preparing a framework for crypto fundraising and an exemption that could open 24/7 trading of tokenized stocks.
    Contradicting Expectations! Goldman Sachs Strategist: The Federal Reserve May Remain Steady This Year

    Contradicting Expectations! Goldman Sachs Strategist: The Federal Reserve May Remain Steady This Year

    What Makes FOMO So Scary?

    What Makes FOMO So Scary?

    Intervention in the Yen: The Joint Maneuver That Manipulates Its Wealth and Exposes State Fragility

    Intervention in the Yen: The Joint Maneuver That Manipulates Its Wealth and Exposes State Fragility

    London Controls 70% of Gold Trading, UK Moves to Regulate Tokenized Gold! FCA Proposes New Regulations

    London Controls 70% of Gold Trading, UK Moves to Regulate Tokenized Gold! FCA Proposes New Regulations

    Bitcoin Core Developer States: Code, Not White Paper, Matters

    Bitcoin Core Developer States: Code, Not White Paper, Matters

    Bitcoin Core developer Jeff Garzik stated that the early success of Bitcoin did not stem from the white paper, but rather from widespread exposure generated by a post on Slashdot in July 2010, along with the combination of both factors, as quoted by Wu Blockchain.
    SpaceX Director Antonio Gracias Discloses 6.5% Stake

    SpaceX Director Antonio Gracias Discloses 6.5% Stake

    AI Hyperscalers Are Pricing Bitcoin Miners Off The Grid— Here's Why Its A Massive Win-Win

    AI Hyperscalers Are Pricing Bitcoin Miners Off The Grid— Here's Why Its A Massive Win-Win

    AI is pricing Bitcoin miners off the main power grid. Headlines call it a surrender, but a massive infrastructure win is hiding inside the eviction.
    Rasmal Ventures Participates in Yuno's $45 Million Round

    Rasmal Ventures Participates in Yuno's $45 Million Round

    The Real Cost of Strategy's Forced Dollar Hoarding

    The Real Cost of Strategy's Forced Dollar Hoarding

    Fractionating Bitcoin Custody is the Only Real Shield in the Sector

    Fractionating Bitcoin Custody is the Only Real Shield in the Sector

    MEXC Leaves the Netherlands: Kraken Partnership Absorbs Customers

    MEXC Leaves the Netherlands: Kraken Partnership Absorbs Customers

    ENS Completes a Quiet "Self-Revolution"

    ENS Completes a Quiet "Self-Revolution"

    How to Buy SpaceX Stock in 2026: Price, Ticker, and Where to Buy

    How to Buy SpaceX Stock in 2026: Price, Ticker, and Where to Buy

    Learn how to buy SpaceX stock in 2026, including the SPCX ticker, latest price, brokerage access, tokenized stock options, trading hours, and key considerations.
    Blockchain.RIO Establishes Rio as a Global Stage for Financial Innovation

    Blockchain.RIO Establishes Rio as a Global Stage for Financial Innovation

    The Blockchain Rio Week 2026 began this Tuesday, August 11, in Rio de Janeiro, with a day entirely dedicated to the institutional layer of the sector — regulators, central banks, market associations, and major financial institutions, before the opening of the main event to a broader audience. The da...
    "It was right to fire Luke Dashjr, even if it was 10 years late": Turtlecute

    "It was right to fire Luke Dashjr, even if it was 10 years late": Turtlecute

    Hardware Wallet: The Challenge of Zero Trust in Your Seed

    Hardware Wallet: The Challenge of Zero Trust in Your Seed

    Is Bitcoin Approaching a Bottom? The Paradoxical Signal from USDT

    Is Bitcoin Approaching a Bottom? The Paradoxical Signal from USDT

    Even if Bitcoin Rises, It May Not Concern You

    Even if Bitcoin Rises, It May Not Concern You

    Binance rejects claim it will withdraw Singapore case against RedotPay

    Binance rejects claim it will withdraw Singapore case against RedotPay

    Global Cybersecurity Alliance (GCSA) and Academy of Engineering and Technology of the Developing World (AETDEW) Jointly Establish AI Cybersecurity Research Center

    Global Cybersecurity Alliance (GCSA) and Academy of Engineering and Technology of the Developing World (AETDEW) Jointly Establish AI Cybersecurity Research Center

    Bank of England to test stablecoin, digital currency use in cross-border finance

    Bank of England to test stablecoin, digital currency use in cross-border finance

    Why RWA is Still Growing Amid the DeFi Downturn?

    Why RWA is Still Growing Amid the DeFi Downturn?

    Web3: Foreign Media Reports Crypto Exchanges Expand Multi-Asset Trading with CFDs

    Web3: Foreign Media Reports Crypto Exchanges Expand Multi-Asset Trading with CFDs

    Gold Price and Inflation: Can the US CPI Push Gold to $5,000?

    Gold Price and Inflation: Can the US CPI Push Gold to $5,000?

    Cryptocurrencies Make Their Way in Latin America Amid Regulatory Gaps and Controversies

    Who Really Captures Crypto Revenues?

    Google and Ryanair Sign Five-Year Cloud and AI Agreement

    Google Pixel 11 Released: Minor Hardware Changes, Major Gemini Features

    How to Use Dune: Dashboards That Help Cryptocurrency Investors

    Crypto and Tokenized Stocks: The SEC's Major Shift Becomes Clearer

    The SEC is preparing a framework for crypto fundraising and an exemption that could open 24/7 trading of tokenized stocks.
    ...
    Invite friends, get rewards
    Invite to get up to $160 + 40% commission
    Invite friends, get rewardsInvite

    Contents

    Billion

    Latest articles

    2026/08/12

    Hardware Wallets Aren’t the Problem, Says Ledger Exec. AI Attackers Are

    FASTFAST
    00.00%--
    CHIPCHIP
    00.00%--
    2026/08/11

    web3: Leveraged ETFs Boost AI Stocks, Closing Rebalancing May Amplify Volatility

    INDEXINDEX
    00.00%--
    CHIPCHIP
    00.00%--
    2026/08/11

    A Decade After Losing 35% of Its Wafers, This Japanese Stock Is Back in the Quake Zone

    NOWNOW
    00.00%--
    CHIPCHIP
    00.00%--
    2026/08/11

    Morgan Stanley Analysis: AI Chip Surge, Can Power Keep Up? Implied Demand of About 38GW by 2027

    CHIPCHIP
    00.00%--
    2026/08/09

    Situational Awareness Bets US$ 400 Million on Chips After Losing Half of Its Fund

    CHIPCHIP
    00.00%--
    More

    Latest coin listings on WEEX

    logoCommunity
    iconiconiconiconiconiconicon
    Customer Support:@weikecs
    Business Cooperation:@weikecs
    Quant Trading & MM:bd@weex.com
    VIP Program:support@weex.com
    • About Us
    • Announcement Center
    • Media Kit
    • WEEX Community
    • WXT Zone
    • Announcement
    • Legal Statement
    • Risk Disclosure
    • Terms and Policies
    • Privacy Policy
    • Whistleblower Notice
    • AML/CTF Policy
    • Law Enforcement
    • User Guide
    • Product Launches
    • Crypto News
    • Product Launches
    • Crypto Wiki
    • Learn
    • Q&A
    • Spot
    • Futures
    • Glossary
    • VIP Program
    • Download
    • Affiliate
    • Protection Fund
    • Proof of Reserves
    • Sitemap
    • ETFs
    • Crypto Prices
    • Price Predictions
    • WXT Price
    • BTC Price
    • ETH Price
    • DOGE Price
    • How to Buy Crypto
    • How to Buy WXT
    • How to Buy BTC
    • How to Buy ETH
    • How to Buy DOGE
    • Help Center
    • Fee Schedule
    • Trading Rules
    • WEEX Academy
    • Contact Verifier
    • Submit Feedback
    • About Us
    • Announcement Center
    • Media Kit
    • WEEX Community
    • WXT Zone
    • Announcement
    • Help Center
    • Fee Schedule
    • Trading Rules
    • WEEX Academy
    • Contact Verifier
    • Submit Feedback
    • Customer Support Bot
    • VIP Services
    • Legal Statement
    • Risk Disclosure
    • Terms and Policies
    • Privacy Policy
    • Whistleblower Notice
    • AML/CTF Policy
    • Law Enforcement
    • Proof of Reserves
    • Invite Friends
    • OTC
    • Download
    • Affiliate
    • VIP Program
    • API
    • Broker
    • Listing Application
    • Affiliate T&C
    • Sitemap
    • Futures
    • Spot
    • Copy Trade
    • Markets
    • WEEX Store
    • User Guide
    • Product Launches
    • Crypto News
    • Product Launches
    • Crypto Wiki
    • Learn
    • Q&A
    • Spot
    • Futures
    • Glossary
    • VIP Program
    • Download
    • Affiliate
    • Protection Fund
    • Proof of Reserves
    • Sitemap
    • ETFs
    • Crypto Prices
    • Price Predictions
    • WXT Price
    • BTC Price
    • ETH Price
    • DOGE Price
    • How to Buy Crypto
    • How to Buy WXT
    • How to Buy BTC
    • How to Buy ETH
    • How to Buy DOGE
    • About Us
    • Announcement Center
    • Media Kit
    • WEEX Community
    • WXT Zone
    • Announcement
    • Help Center
    • Fee Schedule
    • Trading Rules
    • WEEX Academy
    • Contact Verifier
    • Submit Feedback
    • Legal Statement
    • Risk Disclosure
    • Terms and Policies
    • Privacy Policy
    • Whistleblower Notice
    • AML/CTF Policy
    • Law Enforcement
    • Customer Support Bot
    • VIP Services
    • Futures
    • Spot
    • Copy Trade
    • Markets
    • WEEX Store
    • Proof of Reserves
    • Invite Friends
    • OTC
    • Download
    • Affiliate
    • VIP Program
    • API
    • Broker
    • Listing Application
    • Affiliate T&C
    • Sitemap
    • User Guide
    • Product Launches
    • Crypto News
    • Product Launches
    • Crypto Wiki
    • Learn
    • Q&A
    • Spot
    • Futures
    • Glossary
    • VIP Program
    • Download
    • Affiliate
    • Protection Fund
    • Proof of Reserves
    • Sitemap
    • ETFs
    • Crypto Prices
    • Price Predictions
    • WXT Price
    • BTC Price
    • ETH Price
    • DOGE Price
    • How to Buy Crypto
    • How to Buy WXT
    • How to Buy BTC
    • How to Buy ETH
    • How to Buy DOGE

    Where new wealth is made

    Download app

    Sign Up
    h5 logo
    Download