Whether you are in the crypto market or not, as long as you pay a little attention, it always seems that those stories of hundreds or thousands of times riches will itch your heart, making you unable to resist putting yourself in that position, and then stepping onto the stage.
However, only after truly participating will you realize that behind a few lucky individuals who struck it rich, the vast majority are just silent casualties or even losing everything.
01
Do not assume anyone will think of you
Even if you feel like part of the cryptocurrency Twitter community, feeling like you belong to a big family, in reality, you are fighting alone in this market. The cryptocurrency market is a 'player versus player' arena, where everyone is pursuing their own interests.
No one will sincerely consider you; all decisions and actions revolve around self-interest. Therefore, you need to remain vigilant, relying on your own judgment rather than expecting goodwill from others.
02
Information asymmetry on Twitter is extremely high
On social media platforms like Twitter, information asymmetry is very serious. Some influential people may have more insider information or market dynamics, while ordinary investors often find themselves at a disadvantage. To make wise investment decisions in the cryptocurrency market, you need to be clear about who the truly valuable information sources are.
Pay attention to the right people; you may gain huge 'alpha.' Blindly following the wrong people may lead to total loss. Learning to discern the reliability and motives of information sources is key to successful investing.
03
Trust your own judgment
When market sentiment fluctuates, others’ suggestions are often unreliable.
When the market is rising, if you ask others what to buy now, they might say: 'Buy at the market's high? Are you stupid?'
When the market is down, if you ask others what to buy now, they will say: 'It's all over, buying now is foolish.'
These feedbacks often reflect the extremes of market sentiment rather than objective advice. Therefore, learn to trust your own analysis and judgment, and do not be swayed by others' emotional statements.
04
Stay away from echo chambers
On Twitter, it is easy to fall into an 'echo chamber,' only hearing voices that align with your own views. Do not use social media to seek confirmation bias; instead, use it to test and challenge your investment perspectives.
For example, if you are considering investing in a popular token (like 'HYPE'), besides focusing on the positive voices supporting it, actively seek out opposing opinions. You may have overlooked some key risks or issues. Keeping an open mind will help you make more comprehensive decisions.
05
Spend time on valuable things
Rather than arguing online with anonymous people, spend your time on more productive matters, such as:
Read project whitepapers to understand the technology and business logic of the project in depth;
Experiment with related applications on-chain, personally experience their functions and potential;
Interact with the community on Telegram or Discord, ask questions, and get firsthand information;
Record your investment thoughts and write down your investment logic.
Thinking on paper can help you clarify your thoughts. Writing down your investment arguments before making an investment can allow you to assess decisions more rationally and avoid emotional trading.
06
Do not let the gains of others shake your beliefs
Seeing others making large sums of money in a short time can make you feel fear, doubt, or fear of missing out regarding your long-term holdings. But remember, the investment logic for long-term holdings is measured in years, not weeks or days.
If your investment argument still holds, stick to your position; but if the market or project's fundamentals have changed, sell decisively. Never 'fall in love with your position'; maintaining flexibility and rationality is crucial.
07
Emotional management in trading
In trading, emotions are often the biggest enemy. Here are some suggestions:
If you feel overly excited about a position, consider selling;
If a certain asset's price suddenly skyrockets, sell decisively.
The market cannot rise forever; the key to long-term survival is learning to lock in profits. Greed can make you miss the best exit opportunities.
08
Understand the sources of income in decentralized finance (DeFi)
In DeFi platforms, if you cannot clearly explain the source of income in two sentences, you are likely the 'source' of income. In other words, you may be providing liquidity or taking on risks for others without realizing it. Before investing in DeFi projects, be sure to understand their economic models and risk points.
09
Narratives determine everything
In the cryptocurrency market, narratives are the core force driving prices. The stories built by market participants can greatly influence asset values. For example, Dogecoin once reached a total market value close to $100 billion, which was entirely driven by narratives.
This reminds me of a saying: 'Do you want to make money, or do you want to prove you are right?' In the market, following narratives often yields better returns than being fixated on being 'correct.'
10
Do not chase highs
When you discover a new project and think, 'Wow, this idea is amazing,' but procrastinate for weeks without investing, then when its price suddenly soars, do not chase the high. Your best investment opportunity was missed weeks ago. Jumping in now may lead to buying at a local high. Learn to accept missed opportunities and patiently wait for the next.
11
Emotions are temporary
When you start making money, you may feel extreme excitement; this feeling can be addictive, and you'll want to constantly recreate that sensation. However, overtrading or frequent position switching often stems from chasing that feeling rather than rational investment decisions. Learning to control emotions and stay calm is crucial to avoiding unnecessary losses.
12
Understand market cycles and sector rotation
In a bull market, not all assets will rise at the same time. Typically, the market will go through different phases, with certain sectors (like DeFi, NFT, Layer 2, etc.) performing alternately. Pay close attention to emerging narratives and trends, and position yourself in advance rather than chasing sectors that have already started. Planning your investment strategy will give you an advantage in the market rotation.
13
The cost of making mistakes is lower when you are young
Making mistakes in your twenties is much cheaper than making mistakes in your forties; losing $1,000 is much easier to bear than losing $100,000. When I first tried leveraged trading, I lost thousands of dollars in a few minutes, but that failure taught me valuable lessons. Failure is part of growth, but ensure that the cost of failure is within your means.
14
Why most people do not make money in the crypto market
Ordinary investors often find themselves at a disadvantage in the cryptocurrency market for the following reasons:
YouTubers or influencers promote a project on Twitter, and the price begins to rise;
The token enters the top 100 on CoinGecko, attracting more attention;
KOLs, venture capitalists, or early investors start selling during the rise;
The project becomes 'well-known', and ordinary investors begin to buy in;
Retail investors buy and push prices up, but the gains are limited;
KOLs, VCs, etc., sell all their holdings;
Token prices crash (usually while you are sleeping), and you are forced to take a loss.
Understanding this pattern can help you avoid becoming a 'bag holder.'
15
Give yourself time
We all want to get rich quickly, but success in the cryptocurrency market takes time. Slow and steady wins the race. Of Warren Buffett's $84.5 billion fortune, $81.5 billion (over 96%) was accumulated after he turned 65. This reminds us that patience and long-term persistence are key to wealth accumulation.
16
What you want is not retirement, but freedom
Many people think retirement is the goal, imagining themselves lounging on a Caribbean beach. But retirement can become boring after just a week. The real goal is freedom - waking up every day to do what you want, creating value with interesting people, while also having enough time for family and friends. The cryptocurrency market may offer you financial freedom, but do not forget to pursue more meaningful life goals.
17
The cost of being full-time in cryptocurrency
If you want to quit your stable 9-to-5 job and fully engage in the cryptocurrency market, ask yourself if you are ready to be online 10 to 16 hours a day, 7 days a week, for years. Even then, there are no guarantees of success. Dedicating yourself full-time to the crypto market requires extreme self-discipline, patience, and mental resilience.
18
Reflections after success
When you 'succeed' in the cryptocurrency market, you may find that this is not what you initially wanted. You have money, but you are still you. Money does not solve all problems. If your only goal is money, you may feel empty or even depressed after achieving success. Therefore, set goals that are more important than money, such as personal growth, family happiness, or social contribution, to make your success more meaningful.
