Understanding candlestick charts is not difficult; controlling your mindset is the real skill.
As a female analyst who has been in the cryptocurrency industry for six years, I have seen too many people come in with dreams of getting rich quickly, yet they can't even achieve the most basic goal of 'not losing money.' I have also paid seven figures in tuition to gradually understand the survival rules of this market.
Today, I want to share 8 core insights that I have exchanged for real money, hoping to help you avoid taking wrong turns.
1. Protecting your principal is more important than anything else.
The cruelest math problem in the cryptocurrency world: Doubling 1 million to 2 million requires a gain of 100%, but losing back to 1 million from 2 million only requires a loss of 50%. If you can't hold onto your profits, everything is just fleeting.
I have a friend in my community who made 800,000 last year in the first half relying on ETH, but in the second half, greed led him to leverage and chase after meme coins, losing 1.2 million in just one month, including his principal. The crypto space has never lacked opportunities to make money; what it lacks are people who can hold onto profits. Before thinking about how to earn more, learn how not to lose money first.
2. Less fussing around means making money
Many people see their accounts gain 50,000 today and lose 30,000 tomorrow; it seems lively, but in reality, it’s just a lot of effort for nothing. Let’s do the math: with a principal of 1 million, if you experience a '40% gain followed by a 20% loss' cycle each year, after six years, the actual annualized return rate is only 5.8%, which is less than buying government bonds for peace of mind.
I’ve seen the most typical comparison: one friend watches the market every day and makes short-term trades, completing over 200 trades in a year, spending 80,000 on fees, and ends up losing 15%; another friend invests monthly in mainstream coins, not watching short-term fluctuations, and ends the year with a stable profit of 12%. In the crypto space, less trading is often the best strategy.
3. Compound interest is true profit
Don’t be deceived by the myth of 'ten times in a year'; behind those stories are one in ten thousand opportunities and huge risks. Real profits come from stable compound interest: with a principal of 1 million, earning a steady 1% daily, you can reach 145 million in two years.
But this requires extreme discipline. I’ve seen someone make three times in the short term and then want to 'make another push', only to end up betting heavily on obscure coins, losing all profits in a week. Slow is fast, especially applicable in the crypto space.
4. Calculate your goal clearly before taking action
Investing without clear goals is like a headless fly. For example, if you want to turn 1 million into 10 million over 10 years, the annualized return rate needs to reach 25.89%—this number needs to be accumulated by earning 20%-30% consistently each year, not through gambling once.
I would suggest beginners start from reverse forecasting: based on your capital and risk tolerance, first determine a reasonable annual target, and then create a specific investment and position plan. Trading without a plan is just planning for liquidation.
5. Averaging down is a technical skill, not an intuitive one
Averaging down is not just 'adding money when you have it'; it requires precise calculations. For example: buying 1,000 coins at 10 for 10,000, and then buying another 1,000 coins at 5 for 10,000; the average cost is 6.67, not 7.5. If the second purchase is only 5,000, the cost will become 8, making it harder to break even.
In my early days, I relied entirely on intuition for averaging down: buying coins at 15 and then 10, putting in 20,000, and then buying another 30,000 at 8, which resulted in a high average cost and took six months to break even. Before averaging down, be sure to calculate the ratio of the investment amount to the number of holdings.
6. The base position should be like a safety net, not gambling capital
Wanting to keep a base position to 'bet for greater returns' is human nature, but the proportion of the base position must be controlled. If you have 1 million capital and earn 10% (floating profit of 100,000), keeping 100,000 as a base position means that even if there's a pullback, you can only lose the floating profit; if you keep 200,000 as a base position, a market reversal could hurt your principal.
My lesson with SOL: when I had a floating profit of 200,000, I greedily kept 150,000 as a base position, and as a result, SOL pulled back 15%, not only losing the floating profit but also incurring a loss of 20,000. The less the base position, the higher the quality of sleep.
7. A sharp drop is a touchstone
During a sharp market drop, coins that can 'withstand the decline' are usually not just lucky; they have financial backing or solid fundamentals. Last year, when FTX collapsed and the market fell by 25%, some quality coins only dropped by 18%, while worthless coins fell by 80%.
Those coins that resist downturns often rebound faster. A sharp drop is the best moment to test the quality of coins; only those that can withstand it are worth holding for the long term.
8. The crypto space is a marathon, not a sprint
Many people treat the crypto space as a 'casino', hoping to get rich overnight through one market movement, but often end up exiting midway. Those who can consistently make money treat the crypto space as a long-term business to manage.
I know a friend who treated the crypto space as a second job for three years, investing monthly in mainstream coins, and his contract position never exceeded 10%. Although he never made '10 times', he had a stable annual return of 30%, doubling his principal in three years, earning more than most who chase trends.
Final insights
Surviving in this market requires rules and patience. I firmly believe that the greatest value in the crypto space is not making you rich overnight, but teaching you how to manage risks, control emotions, and make rational decisions.
These insights may seem conservative, but they are key to your survival. Understand and execute early, and three years from now, you will have a completely different perspective and outcome in the crypto space.
I have walked this path for six years; now I pass the torch to you—are you willing to walk steadily down this road? Follow Ake to learn more about first-hand information and precise points in the crypto space; becoming your guide, learning is your greatest wealth!#美联储降息 #巨鲸动向 $ETH
