I often ask friends who have purchased digital currencies: How can one firmly hold the digital currencies in hand? Some say it relies on a good mindset, some say it relies on fearlessness and mindless buying and holding, and some say it relies on faith.
Generally speaking, my response to similar answers is simple, direct, and blunt—nonsense!
I will ask you four questions:
First: How can one firmly hold digital currency?
Second: Who are the people that make hundreds or thousands of times profit?
Third: What is the essence of digital currency investment?
Fourth: What is the best investment strategy for digital currency?
In terms of mindset, what does a good mindset mean? It is not easy to maintain a good mindset in the face of huge wealth effects and volatile markets.
If the coins you hold have risen hundreds or even thousands of times, can you really still hold them calmly?
If a coin that has risen hundreds or thousands of times suddenly crashes, wouldn’t you struggle with whether to sell it?
Or if you bet all your fortune and even leveraged to buy coins that are halved or even halved again, can you really remain calm?
Only a saint can remain calm; we mere mortals shouldn't deceive ourselves into thinking we can maintain a good mindset and calmness at that time. I can guarantee that at that time, the vast majority of people's thoughts will be that as long as they can break even, they won’t play anymore.
Those who say to hold mindlessly are mostly newcomers to the coin circle who have not experienced a bear market.
In a bull market, buying anything makes money; even if there are occasional adjustments, they quickly recover. Of course, one wouldn’t feel any risks; after all, it will all rise back, so one can certainly buy and hold mindlessly.
This mindless holding is not due to courage, but ignorance. When the market turns bearish, it becomes a situation where anything bought will lose money, and those who suffer huge losses will panic. At that time, if you ask them whether they dare to hold, I estimate that most people will explode: Only fools buy coins! You buy coins, your whole family buys coins!
Let's talk about those who say holding relies on faith. I want to ask: What is faith?
Many people talk about faith without even knowing what Bitcoin and blockchain are.
If you do not have a deep understanding of something, and do not have that kind of deep-rooted sense of recognition, where does the faith come from?
Many people's so-called faith is nothing more than having made money in the bull market and becoming infatuated with the kind of wealth that comes without huge sacrifices, then it turns into faith. I dare say that the vast majority of such people will have their views changed in an instant with just one bearish candle!
I can clearly tell everyone: The fundamental reason for successful investment, besides luck, is strategy! Strategy is the most reliable factor for success, not those vague beliefs.
First, adaptability analysis of core strategies
5%-10% position management principle
Current situation: The total market value of cryptocurrencies is about $2.8 trillion in 2025, Bitcoin's dominance rises to 59.1%, and market differentiation intensifies. Speculative projects like MEME coins are highly volatile (e.g., TST rose over 13,000% in one day and then plummeted 90%), validating the risks of high positions.
Optimization suggestions:
Maintain a risk exposure of 5%-10%, but it needs to be dynamically adjusted: it can be reduced to 5% in the later stages of a bull market and increased to 10% in the later stages of a bear market.
Add a 'stablecoin reserve' mechanism: Keep 20%-30% of funds in compliant stablecoins like USDC to meet liquidity needs during extreme volatility.
30%-40% base currency allocation
Current situation:
Bitcoin: The inflow of US pension ETF funds has strengthened its strategic position, with Standard Chartered predicting it could break $200,000 by the end of 2025.
Ethereum: Dragged down by the Layer2 ecosystem, the price plummeted from $3,336 to $1,805, but may see a rebound driven by technology after the Cancun upgrade.
Ripple (XRP): Legal risks lifted after the SEC dropped its appeal, but institutional sales are still restricted; allocation ratio needs to be controlled (recommended not to exceed 10% of total base currency).
Optimization suggestions:
Base currency allocation adjusted to: Bitcoin 50% + Ethereum 30% + Layer2 leaders (ARB/OP) 20%.
Add 'technical verification indicators': Prioritize projects with on-chain TVL growth exceeding 50% and active developers (e.g., ARB's TVL breaking $25 billion).
No swing trading principle
Current situation:
Market volatility remains significant, with Bitcoin's daily amplitude often exceeding 10%.
Corporate leverage holding risks are emerging: Some listed companies are financing currency purchases through convertible bonds, which could trigger forced sales if the coin price drops.
Optimization suggestions:
Introduce a 'dynamic profit-taking' mechanism: When the holding currency price breaks through historical highs, sell 10% of the position for every 50% increase, locking in profits while leaving room for further gains.
Combine with a dollar-cost averaging strategy: Trigger 'double investment' when the price falls below the 200-day moving average, for example, doubling the monthly investment amount until the price rises above the moving average.
Second, iterative direction of potential coin selection
Technology-driven projects
Layer2 track:
Arbitrum (ARB): occupies 54% of the Layer2 market, leading protocols like Uniswap and Aave have migrated here, it is recommended to allocate 10% of total base currency.
Eclipse (ES): An innovative solution that combines Solana's high performance with Ethereum's security, with the token rising over 200% on its first day, but beware of liquidity risk.
AI + Blockchain:
Bittensor (TAO): A decentralized AI network, with tokens rising over 90% this year and rapid expansion of the subnet ecosystem.
MKB: Optimizes smart contract execution through AI, controlling price fluctuations within ±7% under the hive economy model, already supported by traditional financial institutions.
Key points for risk control
Avoid purely speculative projects: For example, the market value of the TRUMP coin issued by the Trump family plummeted by 90%, so be wary of 'political MEME coins' without actual application support.
Compliance screening: Prioritize projects that have passed the Hong Kong Monetary Authority's stablecoin regulation (like USDC) or are included in the SEC ETF approval list.
Third, response strategies to new market variables
Impact of regulatory policies
United States: (FIT21 Act) promotes compliance, but the approval process for altcoin ETFs is slow; attention needs to be paid to the SEC's characterization of Layer2 tokens.
Hong Kong: A stablecoin licensing system will be implemented in August 2025, with compliant stablecoins like USDC and DAI becoming mainstream tools for cross-border payments.
Response measures:
Allocate 5%-10% of funds to compliant stablecoins to enjoy policy benefits.
Avoid holding tokens that have not been classified as securities (such as altcoins not included in ETFs).
Macroeconomic linkage
Federal Reserve policy: If interest rates are lowered in the second half of 2025, Bitcoin may hit $250,000; if high rates are maintained, safe-haven assets like gold (+18%) may siphon funds.
Corporate behavior: MicroStrategy-style leveraged currency purchasing models pose systemic risks; attention should be paid to the financial reports of listed companies holding Bitcoin.
Response measures:
Allocate 5% of funds to gold ETFs (like GLD) to hedge against interest rate risks.
Track Coinbase's holdings report to avoid high-leverage corporate-related tokens.
Fourth, practical tools and skill upgrades
Smart contract auditing
Use tools like Certik, OpenZeppelin to review project code, focusing on:
Reentrancy protection mechanism (ReentrancyGuard)
Permission control (Ownable)
Oracle security (Chainlink aggregator)
On-chain data analysis
On-chain indicators:
Exchange net flow (changes in exchange wallet balance)
MVRV ratio (market cap to realized value ratio)
Changes in miner holdings (Glassnode data)
Tool recommendations:
Nansen tracks the movements of whale addresses
Dune Analytics analyzes DeFi protocol TVL
Psychological construction plan
Stress testing:
Simulate response strategies when the holding currency price is halved, including capital addition capability and psychological tolerance threshold.
Establish an 'emotion log' to record the psychological state during each trading decision to avoid repeated emotional operations.
Fifth, risk warning and exit mechanisms
Hard stop-loss rules
Technical stop-loss:
If it falls below the 200-day moving average and trading volume increases, reduce holdings by 50%.
If the closing price is below the previous low support level for three consecutive days, liquidate and exit.
Fundamental stop-loss:
The core project team has lost more than 50%.
Regulators have clearly defined tokens as securities.
Timing of exit
Cycle judgment:
When Bitcoin's market capitalization exceeds 65%, enter the late bull market and gradually reduce holdings to a 5% position.
When DeFi TVL has decreased for 6 consecutive months, it indicates that the market is entering the mid-bear market, keep 20% stablecoins + 80% cash.
Sixth, structural opportunities for long-term layouts
Cross-chain infrastructure
Recommended projects:
Multichain (MULTI): Supports cross-chain for 30+ blockchains; although TVL dropped 27.5% in Q1 2025, it remains a core hub for DeFi.
Axelar (AXL): Provides decentralized cross-chain communication, with staking annual yields of up to 18%.
Emerging market opportunities
Latin America and Southeast Asia: During the strong dollar cycle, local investors increase Bitcoin holdings to hedge against local currency depreciation; it is recommended to allocate 5% of funds to regionally stablecoins pegged to USDT (like USDS).
In this uncertain market, the only certainty is change itself. If you currently feel helpless and confused in trading, and want to learn more about the coin circle and get the latest cutting-edge information, click on the avatar to follow the old investor and stop getting lost!
The old investor only does real trading, the team still has spots to join.
