Diversification helps you to spread risk among your assets especially in crypto where the market is very volatile, it's very helpful if mastered.
Over the past year, I think a lot of investors strongly regretted that did not use diversification, it would be possible to save and even earn during the next big price hike
Well, last year deversification especially and would not help in this market, I think the bear market is better to be generally out of the market than in any transaction ! and so of course it is better to deversify when the market starts to grow !
Not only when there is a market increase, always diversifying your portfolio reduces your risk. There is no difference in the amount of money, more diversification means less risk. Indeed, you can complete with less damage in bearish with diversification.