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RE: 'Defensive Sectors' And Bear Markets

in LeoFinance2 years ago

The value of a stablecoin doesn't become apparent until you've reached the peak of a bull and crashed to the depths of a bear...

And while DeFi, such as liquidity pools, do provide a source of income during bears, one must be aware of the potential risk of impermanent loss, where the overall value of your LP tokens goes down due to market fluctuations.

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Great insight! There's definitely the risk of impermanent loss for DeFi during bear markets. Bear markets is the time when some tokens visit the 'graveyard' and if one happens to have a significant amount of those in their portfolio, the loss could be devastating.