Brothers, hello everyone, I am trader Zhu Yidan. Today I had a chat with a fan who was once worth tens of millions. She shared her experiences in the crypto world, where she lost most of her savings in just three years. She asked me if there are still opportunities in the current crypto world. This question made me ponder deeply.
I believe that opportunities in the crypto world are becoming fewer and fewer. The difficulty for ordinary people to make money here is increasing. Most people come in just to lose money, quickly losing their principal during the novice stage, leaving them no time to accumulate the right trading knowledge. The fundamental reason lies in the decreasing amounts of new money, while old money continues to flow out, leading to worsening liquidity in the crypto pond. The food chain is sluggish from top to bottom; a small pond cannot raise big fish.
From 2017 to 2021, with the easing of the macro environment, the crypto world experienced two rounds of crazy bull markets. At that time, as long as you bought spot and held it, there would always be a day to soar. These people are what we call spot traders. In this round, many old investors were deeply influenced by this mindset. Spot trading, which is generally considered a stable trading method, encountered a disastrous Waterloo in this round. Spot trading is no longer a joke; it has become a laughing stock because altcoins can indeed drop by dozens of times from their highs. An altcoin that was once worth 100,000 can be worth only a few thousand after holding it for a year and a half.
Compared to spot trading, the riskier contract trading is a meat grinder for retail investors. Too many people have gone bankrupt because of contracts, but today I don't want to criticize contracts. Instead, I believe contracts are the only way for small funds to grow significantly at this stage. With insufficient liquidity, leverage comes into play, but the difficulty is too great for the average person to handle, and it requires a lot of effort.
For small funds, Bitcoin and Ethereum no longer have the multiple returns to change fate. Looking at the long cycle of altcoins, they are continuously declining. Currently, there aren't many good opportunities for bullish positions in this market. One can only trade on hot topics; if there are no hot topics, don’t trade. If there is no profit effect, don’t trade. I would rather stay in cash than trade. The most important thing is to manage stop losses effectively, try out small costs, and protect the principal. This is the best response strategy I can think of at this stage.
A true bull market will only arrive during a period of economic stimulus, when hot money pours in, turning the small pond of the crypto world into an ocean. At that time, the sky is high for birds to fly, and the sea is wide for fish to leap. Right now, the key is: just hold on!
