At three in the morning, the Bitcoin candlestick chart on the screen suddenly plummeted, and my account evaporated 530,000 within half an hour — that was my first personal experience of the cryptocurrency world’s 'bloody harvest,' which made me fully understand the significance of risk control.
In 2016, after failing in my startup, I stepped into the cryptocurrency world with only 50,000 yuan left in savings. Like many newcomers, I experienced the ecstasy of my account soaring to 800,000 overnight, and I also tasted the bitterness of it shrinking to 180,000 in just a few weeks.
Nine years have passed, and I am still active in this market, not because I am a 'master,' but because after paying nearly one million dollars in tuition, I finally learned how to survive in this cruel 'shura field.'
01 The bitter lessons of survivors, those years when the leeks were cut
The harsh truth of the cryptocurrency world is: 99% of participants ultimately become leeks, and only 1% can survive glamorously. I've witnessed factory workers whose monthly salaries evaporated instantly after investment, and I've seen people around me contemplating suicide after being liquidated due to leverage.
The bear market of 2018 taught me the first key lesson: money made in a bull market can disappear in an instant during a bear market. At that time, the altcoins I held had dropped more than 90%, nearly going to zero.
The biggest illusion in the cryptocurrency world is 'paper profits.' Many mistakenly regard luck as strength and ultimately pay a heavy price. A founder of an exchange candidly said: 'The cryptocurrency world is the most brutal market I've ever seen; it allows 24-hour trading and evolves much faster than the stock market.'
There are no permanent winners here, only temporary survivors.
02 Three iron rules that kept me alive in the cryptocurrency world
1. Principal protection mindset: withdraw the principal when profits reach 50%
The biggest trap in the cryptocurrency world is 'greed.' I once heavily invested in a DeFi project and made ten times the return, but due to not taking profits in time, I ultimately watched my profits evaporate.
Now I have set a strict rule: once an investment profit reaches 50%, immediately withdraw the principal and only use profits to continue gambling. This seems simple, but it requires strong self-discipline.
Mechanical trading discipline is crucial. Set automatic stop-loss points (recommended not to exceed -15%), and withdraw initial investments when profits reach 30% of the principal.
The first rule of survival in the cryptocurrency world is: survive, to have a chance to see tomorrow's market.
2. Monetizing cognition: Only earn money you truly understand
In 2019, the IEO boom swept in, and many blindly followed the trend. I chose to wait and see, as I couldn't understand the underlying logic. In 2021, I heavily invested in Layer 2 because I spent six months studying the technical whitepapers.
In the cryptocurrency world, you will never earn money beyond your cognitive range. Even if you earn by luck, you will eventually lose it all based on skill.
For beginners, the first step is always to learn the basics, not to blindly invest funds. Reliable decisions come from one's own research, not from recommendations by 'experts' on social media.
Data shows that the probability of profit increases by 230% for those who have systematically studied blockchain knowledge.
3. Position Management: Diversifying risk is the long-term strategy
After nine years in the cryptocurrency world, my position allocation has always been stable: 60% Bitcoin and Ethereum as core holdings, 20% in mainstream public chains, 10% for trying out emerging sectors, and 10% cash on standby, with no single cryptocurrency exceeding 15% of the total position.
The most common fatal mistake for beginners is to go all-in. Data shows that all-in traders have an 11 times higher probability of liquidation than those who diversify.
Always remember: do not invest all your funds in the cryptocurrency world, only use spare money for investment, strictly controlling it within 10% of liquid assets.
The market is always changing, but reasonable position management is the best weapon to navigate through bull and bear markets.
03 A practical survival guide for beginners
Based on years of experience, I've summarized several core suggestions for beginners:
Stay away from contract leverage: users with 10x leverage have an average survival period of only 17 days, with 83% of liquidation orders occurring when leverage is ≥5x. Beginners should completely avoid contract trading at first.
Focus on mainstream cryptocurrencies: most small cryptocurrencies in the cryptocurrency world ultimately go to zero. In 2021, the survival rate of the top 50 meme coins was only 12%. Beginners should start with Bitcoin and Ethereum; although the gains may be smaller, the risks are relatively controllable.
Choose reliable platforms: small exchanges carry the risk of running away; choose mainstream platforms and diversify asset storage. I lost hundreds of Ethereum when an exchange called Fcoin ran away; this was a painful lesson.
Cultivate an anti-fragile mindset: top traders do not operate within 24 hours after a loss, regularly review trading logs, and acknowledge cognitive limitations. The cryptocurrency world tests not only skills but also mindset.
My nine years in the cryptocurrency world have taught me that the 'experts' in a bull market often show their true colors in a bear market. Those who truly survive are not the smartest, but the ones who understand risk control best.
Whenever I see stories of 'getting rich overnight' flooding social media, I always think of the advice from that old leek who turned 100,000 into 30 million: 'Fast rises and slow falls are the market makers accumulating, while fast falls and slow rises are the market makers selling off; trading volume reflects market sentiment.'
In the future cryptocurrency world, I will continue to use 60% of my funds to hold onto Bitcoin and Ethereum core assets, allocate 20% to mainstream public chains, try out emerging sectors with 10%, and keep the remaining 10% in cash waiting for market mispricing opportunities. In this industry, surviving longer is more important than making money quickly.
