Making money requires underlying logic. Money earned without logic is just luck. I often tell people in the crypto space that if you have a large amount of capital, the safest way is to dollar-cost average in BTC, and also allocate a small portion to other assets that are less likely to go to zero, again using dollar-cost averaging.
Many people still understand dollar-cost averaging as 'buying in batches': not buying at the highest, not buying at the lowest, able to average down when it drops, which may result in less profit but definitely less loss. They think this is the biggest advantage of dollar-cost averaging.
Actually, it's not. The real benefit of dollar-cost averaging is that it gradually changes your perception of this asset, allowing you to hold it truly.
You must have experienced this: a big gamble, thinking a certain price is a buy, but after buying, the asset remains stagnant, like ETH or DOGE, which could stay still for a year and a half while Bitcoin reaches new highs. You will feel particularly tormented, doubting yourself daily.
Then, after finally rising, you sell as soon as it goes up because you've 'broken even'. Some people may not even wait to break even, getting frustrated and selling immediately.
Why is this happening? Because the holding period has been too long, and you can’t stand it anymore. But dollar-cost averaging won't do this.
Dollar-cost averaging means buying weekly, or even daily. Each purchase essentially refreshes your holding period. You might have dollar-cost averaged for a year, but if you just bought a portion this week, your brain feels like you just started holding it, and you won't be in a hurry to sell.
This is the true power of dollar-cost averaging — it can deceive your brain's perception, making you hold continuously.
This underlying logic, I have yet to see anyone discuss it on the internet.
Now you know why those who dollar-cost average find it easier to hold on, right?
I recently made some money shorting small coins, which is a reflection of information advantage.
In fact, I have always emphasized that our only information advantage as ordinary people is the long-term inflation of fiat currency - that’s why BTC is the most stable choice.
What advantage do you have in buying other small coins? Besides the overarching logic of 'the bull market is here', what basis do you have to judge that it can rise several times or hundreds of times? Don't even mention the bear market; some altcoins don't rise even at the peak of a bull market.
Many people make money in altcoins because they have information advantages, such as KOLs on Twitter, who have groups, resources, and teams behind them. Their ability to think and resonate together is their greatest advantage.
The information that ordinary people can see is mostly superficial and lagging, so it's normal not to dare to invest heavily. Therefore, if you don't have an information advantage, it's basically gambling, buying recklessly.
But I have recently optimized my strategy, and I want to share it with everyone:
Now the market has risen quite a bit; taking a one-sided short position actually carries considerable risk. To avoid sudden surges in a bull market, here’s what I did:
I go long on BTC while simultaneously shorting small coins.
I can handle several scenarios:
• If BTC rises, small coins surge; although there is a loss, it's small.
• If BTC falls and small coins crash, I make a huge profit by shorting.
• If BTC is sideways and small coins gradually fall, you still make money.
• If BTC rises and small coins fall, you make money directly.
The same strategy can be flipped: short BTC and go long on mainstream altcoins.
Make gains when the market rises, and short BTC to hedge when it falls, keeping risks manageable.
Combining these strategies, I have tested and found that I'm profitable in about 75% of cases.
The key is: control losses when losing, and maximize gains when making profits.
Over the long term, the accumulated money can continue to dollar-cost average in BTC or invest in other traditional assets, keeping the assets in a long-term upward channel.