Who exactly are Degens? Cultural analysis of risky speculators in the crypto community

In the cryptocurrency world, you may have heard the word “degens,” which often appears in community discussions in a self-deprecating or mocking manner. This online term comes from the English word “degenerate” (degenerate) and has evolved into a unique identity label in the Web3 ecosystem, which carries both risk warnings and implies a certain community culture identity.

Degen’s Dual Identity: From Slang to Identity

In cryptocurrency trading, “degen” was originally used to describe speculators who employ aggressive trading strategies and are willing to take significant risks in pursuit of high returns. These people usually participate in the market through leveraged trading, fast-in and fast-out, rather than following traditional long-term investment logic.

Interestingly, while the term carries a negative connotation, many participants in the crypto community have transformed it into a symbol of pride. Degens self-identify their trading behavior as speculative and adventurous, yet as a result, they become the most active and passionate contributors in the community. They not only actively participate in project discussions, provide criticism and suggestions, but are also known for their loyalty to the communities they support. This mindset reflects a complex attitude towards risk-takers in the crypto world – both warning of their dangers and acknowledging their enthusiasm and commitment.

High Leverage and Speculation: The Real Risks of Degens Trading

After understanding the trading logic of Degens, it is essential to face the risks posed by such strategies. To amplify trade sizes and increase possible gains, traders frequently use high-leverage tools. In a short period of time, these strategies can lead to amazing profits, especially in a market with highly volatile assets like Bitcoin.

However, leverage is a double-edged sword. The same strategy can cause huge losses at the same speed and scale. Because degens’ judgments are often based on short-term price fluctuations rather than long-term fundamental analysis, they often face extreme market volatility environments. A sudden price jump can turn profits into losses, or even lead to forced liquidation. This risk-reward equation is often more unbalanced in speculative markets than expected.

The Pitfalls of DeFi Degens: Pump-and-Sell Scams and Market Manipulation

In the realm of decentralized finance (DeFi), the word “degens” has taken on a new meaning—it is also used to refer to those involved in pump and dump scams. This manipulation involves buying a large number of coins to drive up the price, inducing others to follow suit, and then selling them in large quantities, ultimately leaving only later holders to bear the losses.

Such misconduct has had a serious negative impact on the DeFi ecosystem. Unfounded hype and deliberate market manipulation not only hurt latecomers but also damage the development environment for legitimate projects. Many projects with real value have suffered unjustified injustices because they compete with these scams, and the credibility of the entire ecosystem has also declined.

Understanding the Two Sides of Degens: Community Contribution and Risk Warning

In conclusion, degens are a complex group in the crypto world. On the one hand, they represent the power of the community willing to take risks and actively participate in ecological construction; On the other hand, their trading methods and manipulative behavior of certain participants are also a significant source of market risk.

To understand the true nature of Degens, we must not only recognize their contributions and enthusiasm for the community, but also be wary of the harms caused by high-leverage trading and market scams. For those new to the crypto market, understanding what degens are is essentially learning how to make rational decisions in this world full of opportunities and risks. Whether you agree with Degens’ trading philosophy or not, careful assessment of risk should be a prerequisite for engaging in any investment activity.