what is Bull Market vs. Bear Market in Crypto world?
Prices go up over an extended period in a bull market, while prices go down in a bear market. In a bull market, traders and investors might generally want to go long. In a bear market, they might want to short the asset or stay in cash.
In some cases, staying in cash or stablecoins may also mean shorting the market, as investors may expect prices to decline. The main difference is that staying in cash is more about preserving capital, while shorting is about taking advantage of the decline in asset prices. But if you sell an asset expecting to buy it back lower, you’re essentially in a short position – even if you’re not directly taking advantage of the drop.
One other thing to consider is fees. Staying in stablecoins likely won’t incur any fees, as there isn’t a cost to custody. However, many short positions will require a funding fee or interest rate to keep the position open.