Chan Theory enlightenment: In the crypto space, 'preferences' are traps; don’t let biases ruin your positions!
Hello, cryptocurrency investors! I am [Lao Luo], a KOL focused on sharing blockchain technology and trading strategies. In the last two episodes, we discussed the first and second lessons of Chan Zhong Shuo Zen theory, emphasizing that making money is the only standard and that there are no mysterious stockholders in the market, only winners and losers.
Today, we continue to advance to the third lesson,
Although the original Chan Theory targets the stock market, its philosophical core is equally profound in the crypto market, especially in the current volatility of 2025. After the Bitcoin halving, market hotspots rotate frequently, and many people get stuck in the mud due to 'preferences'. This lesson strikes at the weaknesses of human nature: your preferences are often death traps! Through simple explanations and examples from the crypto space, we help everyone break free from emotions and enhance trading rationality.
1. The essence of preferences: the deadly hooks of market temptation.
The third lesson of Chan Theory begins with an analogy to the World Cup, pointing out that discussing stocks is boring, but the market often experiences significant drops around the World Cup. This 'common sense' is interesting, but reminds us not to be deceived by appearances. Core sentence: 'Your preferences are your death trap!' The original text states that the first rule of market survival is to eliminate all preferences. Temptations trap you in death through preferences. The market needs 'a fleeting relationship', not a long-lasting one; the only eternal thing is making money, and everything unrelated to making money is nonsense.
Deep meaning analysis: This originates from Zen wisdom—markets are illusory, and preferences are 'attachments', generating greed, anger, and ignorance. Philosophically, preferences stem from subjective biases, obscuring objectivity. Chan Theory critiques 'bird-wing love' style investment: falling in love with a stock often leads to ignoring risks. The reason for buying is not 'good or bad' but 'can it make money?'. Only by seeing through the preference trap can one have a fresh start. Furthermore, utilizing the trap to make money: buy by identifying short traps, sell using long traps.
In the crypto world, this becomes even more fatal. In the first half of 2025, the Solana ecosystem exploded, and many preferred meme coins (like a certain dog-themed project), chasing high prices due to 'fun', resulting in black swan events (like on-chain congestion) leading to crashes. Why? Preferences are like hooks: liking 'narratives' (like AI + blockchain) often leads to ignoring volatility. The World Cup analogy applies to the crypto market's 'event-driven' nature: around the halving, the market often retraces, but those who prefer 'bull market faith' always buy at high points. At a deeper level: the crypto market operates 24/7, with temptations everywhere. Referencing other KOLs like 'Blockchain Observers' or 'Navigators in the Crypto Sea', they often say 'don’t fall in love with projects'; Chan Theory deepens this: preferences are a detour that must be seen through one by one. Otherwise, as the original text states, 'sell low and buy high', in the crypto version, it is FOMO at high points and panic selling at low points.
2. The market is like a training ground: from seeing through to utilizing traps.
The original text emphasizes: seeing the traps clearly is the first step, utilizing traps to make money is the advanced stage. When buying, the short trap is an opportunity; when selling, the long trap is paradise. The market is not lacking people who 'sell low and buy high'; nothing can make everyone profitable, even in a bull market, some still incur losses. Behavior resembles martial arts training, with success relying on wisdom, character, talent, and diligence.
Chan Theory integrates Zen and practical combat; the market is a 'dojo', and preferences are 'obstacles'. To make money, one needs to be 'free of joy and worries' and respond calmly.
Philosophical essence: there is no absolute fairness. Those who prefer 'stable coins' in a bull market may miss out on surges; those who prefer 'high risk' are more likely to face liquidation. The key to cultivation: observe (identify traps) and act (seize opportunities).
After the Ethereum Dencun upgrade in 2025, Layer 2 projects rotate. Many prefer 'established' ones like ETH, neglecting emerging ones like Base, resulting in missed opportunities of tenfold gains. The trap utilization: at the end of the bear market (end of 2024), the panic among shorts is a buying point—Bitcoin dropped to $50,000, and many sold, but hunters saw it as a short trap and bought low. During the bull market climax, the frenzy among bulls is a selling point—such as the meme coin hype, where enthusiasts chase high prices, and we utilize the bull trap to sell high and lock in profits. At a deeper level: behaviors in the crypto space are like 'superior martial arts'—requiring talent (insight), diligence (on-chain data analysis). Other KOLs, like 'Trading Zen Masters', discuss mindset management, while Chan Theory is more practical: not seeing through preferences will lead to becoming a moth to the flame. Example: In the first half of the year, the Ordinals inscription craze led preference-driven 'collectors' to HODL until the crash; rational traders used corrections to enter and exit, profiting from swings.
3. Crypto strategies: Avoid preference traps, grasp the essence of making money.
Chan Theory not only critiques but also provides a path: the reason for buying is solely for making money; if it can win, it’s good; otherwise, it’s nonsense. One must see through preferences in the market and utilize traps. There are still losers in a bull market because they haven’t cultivated properly.
Deep wisdom: This is a mirror of life—the market magnifies human nature. Preferences are like 'death traps', stemming from ignorance; making money requires awakening. Chan Theory emphasizes practice: don’t just talk; see through in action.
Identifying preference traps.: Self-check for preferences—love DeFi? Don’t overlook hacker risks; love meme? Don’t chase narratives. In 2025, the AI coin hype saw many preferring 'concepts', resulting in project exits. Strategy: set rules, only buy those with profit potential (like TVL growth + on-chain activity).
Utilizing market traps.: When buying, find the short low—using on-chain tools to observe whale selling pressure exhaustion. When selling, catch the long peak—RSI overbought + high volume, then exit. Example: After Bitcoin broke $80,000 and retraced, many enthusiasts added positions; we saw it as a short trap and waited for confirmation of a rebound before entering.
Training path: start with small amounts to gain experience. Bull market rhythm: warming up (testing hot spots), main rally (following strong coins), retracement (using traps for rotation). Risk control: stop loss, don’t stop profit, don’t let preferences interfere.
Deep application.: There are no 'handsome myths' in the crypto space (like perfect projects); handsome footballers are more interesting than stockholders, but the market is unrelated to Chan Theory plus Zen flavor: survival relies on being free of preferences and calmly making money.
As a KOL, I have witnessed countless cases of liquidation due to preferences: one fan preferred NFTs and held on during the bear-to-bull shift in 2025, resulting in missed rebounds. Chan Theory redemption: see through biases, seize opportunities.
Awakening to preference traps, stepping towards the path of winners.
The core of the third lesson of Chan Theory: preferences are death traps, eliminate them, and utilize market temptations to make money. At a deeper level, it is about Zen practice: from seeing through to calmness. The crypto space needs this wisdom even more—temptations abound, and traps are deep. In the next episode, we will analyze the fourth lesson, 'Rationality is achieved through action', discussing the practical path in the cryptocurrency market.
Feel free to comment on your 'preference' traps or join the community to discuss Chan Theory in the crypto space. Like and share to support dissemination! Remember: the market is ruthless, and making money is eternal.
