While you are still fantasizing about 100x coin, the pro has silently regarded you as Liquidity.

Original Author: Route 2 FI

Reprint: Daisy, Mars Finance

Whether you are in the cryptocurrency market or not, as long as you pay a little attention, it seems you will always be tempted by those stories of making hundreds or thousands of times in wealth, unable to resist putting yourself in their place, and thus stepping onto the card table.

However, only after truly participating will one realize that behind the few lucky individuals who have become wealthy, the vast majority are just silent cannon fodder, even losing everything.

After several years of deep cultivation in the cryptocurrency market, I have learned these 18 lessons:

1. Don’t assume anyone will think of you.

Even if you feel like you are part of the cryptocurrency Twitter community and 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 truly consider you; all decisions and actions revolve around self-interest. Therefore, you need to stay alert and rely on your own judgment rather than expecting the goodwill of others.

2. The information asymmetry on Twitter is extremely high.

On social media platforms like Twitter, the phenomenon of information asymmetry is very serious. Some influential individuals may have access to more insider information or market dynamics, while ordinary investors often find themselves at a disadvantage. To make informed investment decisions in the cryptocurrency market, you need to clearly identify who the truly valuable sources of information are.

Focus on the right people, and you may gain significant “alpha”; blindly following the wrong ones, and you may lose everything. Learning to discern the reliability and motivations of information sources is key to successful investing.

3. Trust your own judgment

When market sentiment fluctuates, others’ advice is often unreliable.

When the market is rising, if you ask others what to buy now, they might say: “Buy at the market’s peak? Are you stupid?”

When the market is down, and you ask others what to buy now, they will say: “Everything is over, buying now is foolish behavior.”

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 influenced by the emotional remarks of others.

4. Stay away from echo chambers

On Twitter, it is easy to fall into an “echo chamber,” where you only hear voices that align with your own views. Don’t 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”), in addition to paying attention to the voices supporting it, you should also actively seek out opposing opinions. Perhaps you have overlooked some key risks or issues. Keeping an open mind will allow you to make a more comprehensive decision.

5. Spend time on valuable things.

Instead of arguing online with anonymous people, it’s better to spend time on more productive things, such as:

Read the project white paper to gain a deeper understanding of the project’s technology and business logic.

Experiment with relevant applications on the blockchain to personally experience their functions and potential;

Interact with the community on Telegram or Discord, ask questions, and get firsthand information;

Record your investment ideas and write down your investment logic.

Thinking on paper can help you clarify your thoughts more clearly. Writing down your investment arguments before investing allows you to assess decisions more rationally and avoid emotional actions.

6. Do not waver in your beliefs because of others’ gains.

Seeing others make a lot of money in a short period of time may cause you to feel fear, doubt, or fear of missing out regarding your long-term holdings. But you need to remember that the investment logic of long-term holdings is measured in years, not in weeks or days.

If your investment thesis still holds, then hold on; but if the market or the fundamentals of the project have changed, decisively sell. Never “fall in love with your position”; maintaining flexibility and rationality is crucial.

7. Emotional Management in Trading

In trading, emotions are often the biggest enemy. Here are some suggestions:

If you feel overly excited about a certain position, consider selling it;

If the price of an asset suddenly surges, sell decisively.

The market cannot rise forever; the key to long-term survival is to learn how to lock in profits. Greed may cause you to miss the best exit opportunities.

8. Understand the sources of income in decentralized finance (DeFi)

In a DeFi platform, if you cannot clearly explain the source of earnings in two sentences, you are likely the “source” of the earnings. In other words, you may be providing liquidity or taking on risks for others without realizing it. Before investing in DeFi projects, it is essential to understand their economic model and risk points.

9. Narrative determines everything

In the cryptocurrency market, narratives are the core driving force behind price movements. The stories constructed collectively by market participants can significantly influence asset value. For example: Dogecoin once had a total market capitalization close to $100 billion, which was entirely the result of narrative-driven factors.

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 the narrative often brings more rewards than being obsessed with being “right.”

10. Do not chase the high

When you discover a new project and think, “Wow, this idea is amazing,” but then procrastinate for weeks without investing, don’t chase the price when it suddenly skyrockets. Your best investment opportunity was missed weeks ago. Jumping in now could very likely mean buying at a local high point. Learn to accept missed opportunities and patiently wait for the next one.

11. Emotions are temporary.

When you start making money, you may feel extremely excited, and this feeling can become addictive, making you want to constantly recreate that pleasure. However, excessive trading or frequently rotating positions often stems from chasing this feeling rather than making rational investment decisions. Learning to control your emotions and stay calm is essential to avoid unnecessary losses.

12. Understanding Market Cycles and Sector Rotation

In a bull market, not all assets will rise simultaneously. Typically, the market will go through different stages, and certain sectors (such as DeFi, NFT, Layer 2, etc.) will take turns performing. Pay close attention to emerging narratives and trends, and position yourself in advance rather than chasing already launched sectors. Plan your investment strategy well to gain an advantage in market rotations.

13. The cost of making mistakes is lower when you are young.

Making mistakes in your 20s is far less costly than making mistakes in your 40s; a lesson learned from losing $1,000 is much easier to bear than one learned from losing $100,000. When I first tried leveraged trading, I lost thousands of dollars in just a few minutes, but that failure taught me valuable lessons. Failure is part of growth, but make sure that the cost of failure is within your means.

14. Why do most people fail to make money in the cryptocurrency market?

Ordinary investors are often at a disadvantage in the cryptocurrency market for the following reasons:

A YouTuber or influencer promotes a project on Twitter, and the price starts to rise;

The token enters the top 100 on CoinGecko, attracting more attention;

KOLs, venture capitalists or early investors start selling when the price rises;

The project has become “well-known,” and ordinary investors have started to buy in;

Retail investors buy in to push up prices, but the increase is limited;

KOLs, VCs, etc. sold all their holdings;

The token price plummets (usually while you’re asleep), and you’re forced to cut your losses.

Understanding this model can help you avoid becoming a “bag holder.”

15. Give yourself time.

We all hope 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 commitment 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 beach in the Caribbean. But retirement life 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 having enough time to spend with family and friends. The cryptocurrency market may offer you financial freedom, but don’t forget to pursue more meaningful life goals.

17. The Cost of Being a Full-Time Cryptocurrency Trader

If you want to quit your stable nine-to-five job and fully immerse yourself in the cryptocurrency market, ask yourself if you are prepared to be online 10 to 16 hours a day, 7 days a week, for several years. Even then, there are no guarantees of success. Fully dedicating yourself to the crypto market requires a high level of self-discipline, patience, and mental resilience.

18. Reflection on Success

When you are “successful” in the cryptocurrency market, you may find that it is not what you originally wanted. You have money, but you are still the same you. Money does not solve all problems. If your only goal is money, you may feel empty or even depressed after achieving success. Therefore, setting goals that are more important than money, such as personal growth, family happiness, or social contribution, can make your success more meaningful.