Cryptocurrency Contracts: Retail Investors' Meat Grinder, Whales' ATM
Fantasy vs Reality: Retail Investors' Dreams of Getting Rich Shattered
Do you think you can accurately buy the dip and sell the top? The reality is: Shorting at $90,000, the whales push the price up to $105,000 and liquidate the shorts; chasing the price high, the whales crash the price to $80,000 and liquidate the longs. With 50x leverage, two rounds of operations can wipe out the principal, while the whales make a fortune.
Why Do Retail Investors Always Lose? Three Major Traps
Whales' Dimensional Attack and Spike Harvesting: When the exchange depth is insufficient, the whales can create a 20% price movement in one minute, rendering stop-loss orders useless. Contract Loophole: In extreme market conditions, the profitable party must bear the risk of liquidation losses, effectively making the retail investors “foot the bill” for the whales. Human Weakness Targeted: Greed and Fear: Wanting to double profits when in the green, wanting to break even when in the red, frequent trading fees eat into 30% of the principal. Leverage Suicide: With 100x leverage, a 1% movement can trigger liquidation. Those using more than 20x leverage have a liquidation rate exceeding 97% in three months. Technical Indicator Trap - False Breakout Lure: Whales draw lines to create the illusion of a “breakout,” with BTC plummeting 15% within 24 hours after multiple new highs. Double Kill: Whales simultaneously manipulate spot and contracts, first enticing longs then crashing the price, and finally pushing it up to eliminate shorts.
Survival Rules: From Retail Investor to Hunter
Recognize the Essence
Contracts are a Zero-Sum Game: Fees + Liquidation Sharing, retail investors face an annualized cost exceeding 30%. Spot investors have averaged a 438% gain from 2020 to now, while contract players have averaged an 89% loss.
Ironclad Discipline
Position Control: Each trade should be ≤5% of the principal, major coins leverage ≤10x, altcoins ≤5x. Stop Loss First: Cut losses at 5% immediately; don’t believe in “holding to break even.” Trend Trading: Only capture monthly level breakouts, such as BTC breaking out after 3 months of consolidation, which occurs only 2-3 times a year.
Advanced Strategies
Hedging: Miners sell 30% of their monthly yield to hedge risk; even when a certain mining site’s BTC drops 30% in 2024, they still make a 20% profit. Spot-Futures Arbitrage: When the quarterly contract premium exceeds 5%, buy spot + sell contracts for risk-free arbitrage.
The Heart-Wrenching Truth: Mathematical Rules Determine Outcomes
Fees + Funding Rate + Liquidation Sharing, daily holding cost is 0.12%, annualized exceeding 30%. Professional traders candidly say: “Playing contracts for a year is not as good as lying on spot for three years.”
Blindly Going Solo Will Never Bring Opportunities; follow me to explore tenfold potential coins! Top-tier primary resources!
Today's Focus: PNUT ETH INIT DOGE
