As the Bitcoin ecosystem gains attention at the end of 2023, along with the expectation of a Bitcoin spot ETF in 2024, the Bitcoin halving event, and the Federal Reserve’s signal of an accommodative monetary policy, the market generally believes that a bull market will come along with the new year. This article will share some investment experiences in the crypto market, hoping to help investors achieve satisfactory returns in the future. This article is sourced from the author 0XKYLE.
Article, compiled, organized, and written by DeepTide.
(Prior summary: Rich Dad’s investment advice: Bitcoin and gold are the best choices, stocks and bonds will face the biggest crash in history)
(Background supplement: Will meme coins be the best target for 2023?)
Table of Contents
Trading
On-chain
Psychology
Life advice
This article mainly introduces 50 lessons learned by the author in the cryptocurrency market in 2023, hoping that these lessons can help readers in the bull market of 2024.
Before explaining the 50 lessons in detail, the author first explains one point that he agrees with the most: to get rid of the bear market mode and leave room for the new investment model of the bull market.
He believes that the cryptocurrency bull market is highly reflexive. Although the market has recently experienced fluctuations, it is not meaningful to wait for a pullback to buy. Trying to time the top has little significance. Despite being bullish himself, the author has made such mistakes in the past few weeks.
Below, we will introduce in detail the lessons learned by the author in the cryptocurrency world in 2023. These experiences are not only about trading but also about integrating knowledge and action in life.
Trading
1. Patience is a position.
2. Don’t trade your profits and losses.
3. Bulls continue to go long, bears reduce positions. In an attention-driven market, assets that receive capital attention are strong indicators and have strong reflexivity. On the contrary, poorly performing assets have lower attention and are likely to remain so, resulting in weaker price increases.
4. Examine alt/BTC and alt/ETH charts in technical analysis.
5. Trading should be process-driven – write down the steps to take and repeat them.
6. Usually, your life is guided by emotions. Trading is the opposite – you can’t follow emotions, such as reducing positions because you feel bad, or adding positions because you feel good.
7. Most of your profits will come from a few good trades in a month/year, but you have to pay attention to the market for a long time to seize these opportunities. You can’t exit now and expect to come back to complete a great trade.
8. Slow and steady – no need to rush, there will be opportunities tomorrow and in the future.
9. Apply the framework I often use in cryptocurrency trading, as mentioned in previous articles.
10. In a bear market, focus on income and users because valuations return to normal levels, and important indicators are based on fundamentals.
11. In a bull market, focus on growth and speculation because important indicators are more reflexive, such as narrative/founder/flywheel.
12. Pay attention to trading.
13. Checking the price of long-term positions every day may seem insignificant, but it is actually a bad behavior that exposes you to the daily fluctuations of the market and leads you to subconsciously reassess your investments.
14. Your trading advantage is closely related to your personality and your goals in life. Understand yourself and find out what type of trader you are.
15. When you know what type of trader you are, don’t try to become better in other areas. Instead, continue to hone your own style. You won’t see Warren Buffett trying to become better at algorithmic trading.
16. Don’t trade out of boredom, as this influence is huge.
17. Use leverage to go long when there is mass fear, hold spot positions when there is mass leverage going long, exit the market when there is mass euphoria.
18. In a bull market, you consider “the more you earn, the better,” but you should consider “the less you lose, the better” because the market will do a lot for you.
19. Trading and investing are constantly evolving – the coin you went long on an hour ago is not the same coin now; that’s why you have to constantly plan different scenarios and plans.
20. Your investment portfolio is like a battleship – determine the trend, take core positions, make corresponding adjustments based on market conditions, and allocate flexible positions if there is volatility. Changing core positions requires too much time and capital.
21. You must have a selling process because your emotions won’t do it.
22. Target prices as exit points are bad because they have arbitrary possibilities – SOL at 60? 80? 120? 150? You can’t decide when to sell based on price.
On-chain
23. Always test your trades.
24. For emerging projects, you should focus on people – they control all the attention in the market. An active team and a strong founder equal storytellers who can tell stories, which means more market attention.
25. Crypto Twitter (CT) is always late to the market, and it is generally unwise to follow when you see the entire Twitter promoting something.
26. Crypto Twitter is also very toxic and time-consuming. Minimize exposure as much as possible and use TweetDeck for research.
27. In a bear market, everything should have a negative expectation because many projects will not survive. But in a bull market, you must have a positive mindset because they will bring greater profits.
28. Never chase beta (second-best choices), it is better to go long on the leaders.
29. Narrative rotation is a game of short-term outperformance and long-term underperformance.
30. Position size is important. If your altcoin has risen 10 times and your position size is only 0.1%, on the other hand, a large position has doubled, even if your position size is only 50%, you will still earn more than the altcoin.
31. Cryptocurrencies easily distract investors. Teams that know how to announce events and milestones are strategic drivers, and you should always bet on them because it means a stronger token.
32. For low market cap altcoins, you always want to exit when attention decreases.
33. Most people fall into the trap of small/mid-cap coins, convincing themselves that they are investing for the long term once the project cools down, expecting the market cap of the project to continue to rise. I hope you don’t deceive yourself.
Psychology
34. Don’t envy others, take them as your inspiration. You can’t spend other people’s money, and they can’t spend yours. The only standard is yourself.
35. FOMO is the killer of emotions. When you feel FOMO, deal with it properly.
36. Laziness is a sin and it greatly affects your investment (lazy to do research/try new protocols/think deeply).
37. The four main things that every great trader must recognize and overcome are: making mistakes, losing money, FOMO, and missing out on opportunities to make money.
38. Fear of being wrong comes from the self – to heal it, realize that your life is not just trading. So what if you’re wrong? It’s not everything to you, your friends, family, or anyone else doesn’t care if you make a wrong trade.
39. Fear of losing money comes from not fully accepting risk, accept that the market has uncertain outcomes.
40. Avoiding losses is impossible. Losses in trading are like spending income to buy vegetables in a restaurant. It’s the cost of doing business and doesn’t matter at all.
41. If you can’t control emotions, learn to manage them and turn them into your advantage. When you feel excited, take it as a selling indicator (vice versa).
42. Stop trying to impose your will on the market, and don’t have any expectations for it.
Life advice
43. Never say no, but rarely say yes. If you say yes, it must be something that drives you forward or adds value.
44. Consistent “okay” is much better than occasional “great.” Most work is just showing up every day, even if you didn’t do much.
45. The pursuit of goals guides you towards happiness, not the goals themselves. As they say, “If you’re in this process, then you’re already successful.”
46. Fear is in your mind. Why are children not afraid of insects or things we are afraid of? The answer is: we are born clean but taught to fear certain things. Conversely, we can be taught not to fear these things. It’s a matter of perspective.
47. Don’t compare yourself to others. Instead of comparing, figure out if you truly enjoy what you’re doing or if it’s just for social status (prestigious job, etc.).
48. Studies show that social interactions contribute to happiness.
49. There won’t suddenly be a day when you wake up with the motivation to do a certain task. Now is the best time to do the things you’re afraid of.
50. Life is simple, but it’s not easy.
I hope the above lessons can bring some help to your investment, trading, and life in 2024.