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

    [Editorial] The Rails Are Laid Before the World Notices

    [Editorial] The Rails Are Laid Before the World Notices

    Recently, countries leading in RWA (Real World Asset tokenization) include the United States, the United Kingdom, Switzerland, Germany, France, Singapore, Hong Kong, and Japan. ...
    In the Crypto Bear Market, Which Crypto Stocks Are Institutional Giants Accumulating?

    In the Crypto Bear Market, Which Crypto Stocks Are Institutional Giants Accumulating?

    web3: Rakuten Integrates XRP into Its Points and Payment Ecosystem

    web3: Rakuten Integrates XRP into Its Points and Payment Ecosystem

    Rare Evo Conference 2026: Awaiting Clarity & The Agentic Economy Arrives

    Rare Evo Conference 2026: Awaiting Clarity & The Agentic Economy Arrives

    Everything is Broken, Bitcoin is Burning, but it is Becoming Stronger Because of This

    Everything is Broken, Bitcoin is Burning, but it is Becoming Stronger Because of This

    Zcash is borrowing crypto’s new institutional playbook as privacy goes mainstream

    Zcash is borrowing crypto’s new institutional playbook as privacy goes mainstream

    Zcash is building a new distribution layer to expand privacy infrastructure, institutional integrations, and real-world access.
    Charles Schwab has added Bitcoin, Ether trading to its $13 trillion platform

    Charles Schwab has added Bitcoin, Ether trading to its $13 trillion platform

    Why Are Cryptocurrency Believers Throwing Their Coins into AI?

    Why Are Cryptocurrency Believers Throwing Their Coins into AI?

    QuickNode, Privy, N26: Have your data been leaked after the Metabase hack?

    QuickNode, Privy, N26: Have your data been leaked after the Metabase hack?

    Stablecoin BRLV: Crown and Nexa Finance Form Partnership

    Stablecoin BRLV: Crown and Nexa Finance Form Partnership

    Emerging Markets Recovered Flows in July, Thanks to Bonds

    Emerging Markets Recovered Flows in July, Thanks to Bonds

    International capital increased bets on emerging debt and reduced outflows from emerging market equities. Nonetheless, last month's balance was positive after two months of significant outflows. Regarding future access to debt markets, there are some clouds and risks on the horizon.
    The Revolution of Humanoid Robots: When Will They Arrive in Homes and Where Do Investors See Opportunities

    The Revolution of Humanoid Robots: When Will They Arrive in Homes and Where Do Investors See Opportunities

    The advancement of robotics accelerates an industry that still faces challenges of scale, costs, autonomy, and safety before achieving mass adoption. Meanwhile, the latest reports show that more concrete business opportunities are beginning to emerge among supplier companies.
    How to Invest in AI Stocks in 2026: From Nvidia to AI Crypto Coins

    How to Invest in AI Stocks in 2026: From Nvidia to AI Crypto Coins

    Learn how to invest in AI stocks in 2026 with this complete guide. Explore individual AI stocks, AI ETFs, tokenized stocks, AI crypto, and the best ways to gain exposure to the growing AI market.
    Copper expands into US with regulated crypto custody and trading services

    Copper expands into US with regulated crypto custody and trading services

    Bank of America Commits $250 Billion to U.S. Infrastructure

    Bank of America Commits $250 Billion to U.S. Infrastructure

    All-Market Access, 1,000 BTC Protection Fund: How Does WEEX Redefine Crypto Trading Experience?

    All-Market Access, 1,000 BTC Protection Fund: How Does WEEX Redefine Crypto Trading Experience?

    Since 2018, WEEX has built its trading experience on three pillars — security, cross-asset access, and liquidity. Here's how a 1,000 BTC Protection Fund, 330+ TradFi pairs, and Top-2 BTC futures liquidity translate into faster fills, safer trades, and more markets in one account.

    The Wall Street Journal: How AI Trading is Stealing the Spotlight from Cryptocurrency?

    The Wall Street Journal: How AI Trading is Stealing the Spotlight from Cryptocurrency?

    Can Holding Shares Earn Dividends? Hyperliquid is Bringing Traditional Stock Market Rules on Chain

    Can Holding Shares Earn Dividends? Hyperliquid is Bringing Traditional Stock Market Rules on Chain

    Hyperliquid adds bulk adjustment functionality at the balance layer: automatically distributing dividends, executing stock splits and mergers, completing airdrops—on-chain stocks are finally starting to fill the "corporate action" gap.
    SEC clears Franklin mutual funds and ETFs to invest in BENJI

    SEC clears Franklin mutual funds and ETFs to invest in BENJI

    YC Leader Supports High Investment Strategy in AI

    YC Leader Supports High Investment Strategy in AI

    USDT Supply Drops by $4 Billion, Raising Liquidity Concerns and Reducing Investor Market Exposure

    USDT Supply Drops by $4 Billion, Raising Liquidity Concerns and Reducing Investor Market Exposure

    CPI Provides Breathing Room for the Market, but High Deficits, Yen, and Energy Risks Keep Long-Term Funding Costs Elevated

    CPI Provides Breathing Room for the Market, but High Deficits, Yen, and Energy Risks Keep Long-Term Funding Costs Elevated

    Hyperliquid opens low-latency data access under $1K

    Hyperliquid opens low-latency data access under $1K

    Fidelity Plans to Stake ETH Holdings: How Long Can Small Ethereum ETFs Last?

    Fidelity Plans to Stake ETH Holdings: How Long Can Small Ethereum ETFs Last?

    Glassnode Identifies Conditions for a New Bitcoin Crash

    Glassnode Identifies Conditions for a New Bitcoin Crash

    From Subsidy Narrative to Real Returns: The Turning Point Year for DePIN Power Networks

    From Subsidy Narrative to Real Returns: The Turning Point Year for DePIN Power Networks

    What Lies Behind the Professional Appearance of Iranian Exchanges? 30 Criteria for Assessing Reality

    What Lies Behind the Professional Appearance of Iranian Exchanges? 30 Criteria for Assessing Reality

    J.P. Morgan's Global Market Strategy: Are Current Commodities Reminiscent of 2022?

    J.P. Morgan's Global Market Strategy: Are Current Commodities Reminiscent of 2022?

    Coldcard Hack Triggers $15 Billion in Bitcoin Transfers

    Coldcard Hack Triggers $15 Billion in Bitcoin Transfers

    New “Zoomsday” exploit could expose crypto users to zero click attacks

    New “Zoomsday” exploit could expose crypto users to zero click attacks

    [Editorial] The Rails Are Laid Before the World Notices

    Recently, countries leading in RWA (Real World Asset tokenization) include the United States, the United Kingdom, Switzerland, Germany, France, Singapore, Hong Kong, and Japan. ...

    In the Crypto Bear Market, Which Crypto Stocks Are Institutional Giants Accumulating?

    web3: Rakuten Integrates XRP into Its Points and Payment Ecosystem

    Rare Evo Conference 2026: Awaiting Clarity & The Agentic Economy Arrives

    Everything is Broken, Bitcoin is Burning, but it is Becoming Stronger Because of This

    Zcash is borrowing crypto’s new institutional playbook as privacy goes mainstream

    Zcash is building a new distribution layer to expand privacy infrastructure, institutional integrations, and real-world access.
    ...
    Invite friends, get rewards
    Invite to get up to $160 + 40% commission
    Invite friends, get rewardsInvite

    Contents

    Billion

    Latest articles

    2026/08/13

    The Revolution of Humanoid Robots: When Will They Arrive in Homes and Where Do Investors See Opportunities

    The advancement of robotics accelerates an industry that still faces challenges of scale, costs, autonomy, and safety before achieving mass adoption. Meanwhile, the latest reports show that more concrete business opportunities are beginning to emerge among supplier companies.
    UNITREEUNITREE
    00.00%--
    NOWNOW
    00.00%--
    SONYSONY
    00.00%--
    SAMSUNGSAMSUNG
    00.00%--
    CHIPCHIP
    00.00%--
    2026/08/13

    Bank of America Commits $250 Billion to U.S. Infrastructure

    POWERPOWER
    00.00%--
    CHIPCHIP
    00.00%--
    2026/08/12

    web3: Cerebras Shares Drop 14% After Raising Full-Year Guidance

    FASTFAST
    00.00%--
    CHIPCHIP
    00.00%--
    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%--
    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