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12 lessons to win and lose $ 12 million in cryptocurrencies

June 27, 2020

In the past few years, I’ve made over $ 12 million from investing in cryptocurrencies. I didn’t make a single profit until they were multiplied by a hundred at the peak of the market in December 2017. The timing was perfect. However, I only took a small percentage of those profits and then reinvested it into a blockchain startup.

So, The market crashed against me. I have not sold my positions. In any case, I participated in the pre-ICOs and added more risks and losses to the table. Here’s what I learned when I built the crypto market from top to bottom:

  1. Holding (the coins) is the simple strategy, but not the most profitable. If everything you do in the most volatile market that’s likely ever been is a “long-term optimistic bouquet,” Like me, you miss the opportunity. Long-term trust is a strong start, but it’s much better to identify cycles and patterns to minimize losses in ongoing bear markets.

  2. Large coins or stable coins in difficult times, small coins in soft times.

  3. Check the position of your old coins at least every three months, otherwise you could lose them. Coins are removed from the exchange, the exchange is closed, tokens improve the logs. Make sure that the number of different altcoins you own is manageable. Until the market ripens and apples can be distinguished from avocados, altcoins will continue their high price correlation. You may not have to have everyone you like.

  4. Do you have a written exit plan? At least one reference to run. You don’t want to find out your exit strategy in the middle of a roller coaster. I didn’t have one three years ago, but I already did. Includes diversification in other industries.

  5. It is impossible to sell above and buy below. It is not very realistic to believe that the market will reverse after months of decline and only increase the moment it is bought. Several times in the months after buying a coin, I lost 70% of an investment with the goal of making a forty-fold return. However …

  6. Pay attention to the current phase of the project in which you want to invest. There are networks like Polymath that can be extremely successful and profitable in the long run. However, they collected funds for their introduction and used them for product development, market research, overcoming critical regulatory hurdles, tests, etc. All of this takes years. During this time, these tokens will come to market through investor / adviser distributions while there is still little demand or use. Therefore, the focus is on other projects and the prices drop dramatically. We all like the hype of participating in ICOs, but it is likely possible a few years later to buy on platforms with a proven product, an approved business plan, at lower prices, and with much less risk from regulators and that they are ready for marketing are.

  7. The crypto market is not for everyone. My mother said to me, “If it were so easy to make so much money, everyone would do it.” For me, it’s like saying to Rafael Nadal: “If it were so easy to make so much money by hitting a ball with a racket, everyone would do it.” Yes, in crypto you can make a lot of money very quickly. But you can also lose a lot of money very quickly. In order to be “competitive” in the market, you need to have a clear head, a strong stomach and revised information. It is also advisable to be lucky, be on time and know what is being done. Tennis is not as easy as Rafael Nadal.

  8. Do not pay off your mortgage until you are 100% certain that you will no longer have to borrow money in the near future if you only have crypto – no matter how much. As soon as you leave your company job and have no fixed salary, you are alone and it is too risky to do business. No more American corporate warmth when it comes to taking out good health insurance or refinancing a home.

  9. Don’t be like most people and don’t get carried away by fear. At least pay attention to the narrator’s voice in your head. For most people, it’s never a good time to get on the market. When the market falls, “it’s over” and when it gets hot, “it’s too late”. There is always an anxiety-based excuse not to try something that is fun, risky, and adventurous. I have a cousin who researched and researched the market until his eggs turned blue. It felt like I was doing my doctorate. He didn’t invest. It had nothing to do with the market. It’s no fun.

  10. We have no idea what “too high” or “too low” means. Crypto is a new type of animal, so extreme that there is usually a higher high and lower bass. The volatility of this market requires a broader perspective that goes beyond our understanding of traditional markets. Three years ago, my parents said I should sell their ether (ETH) for $ 45. They insisted and I reluctantly accepted it. It was his money, after all, so I had to do it. But when the price of ether continued to rise a few days later, I thought, “I can’t believe I’m listening to my parents, they have no idea where Ether can go.” And I bought it again for $ 60. Wasn’t the $ 13 for Bitcoin (BTC) “too high” at the end of 2012? Yes, of course! Most people sell because they have no idea how high a coin can fly or because “a bird in hand is worth more than two in the bush”. My problem is the opposite: the market is sinking and I think: “Under no circumstances will I sell, it is too low” and it is sinking more and more. I sink down with the boat because it is always “too low for sale” for me. It is also not very clever. I still have to find a practical way to stop the losses and do better.

  11. I have mature, down-to-earth friends in the industry for those moments of red graphics or long walks through the bearish desert to tell you, “I don’t care what’s going on, I’ve seen this. Dozen times before.” It feels so good to hear from someone who knows your shit.

  12. Make a clear distinction between your bitterness in the market and what the market can do in the future. Just because you’ve done good doesn’t mean it will go up forever, and just because you’re desperate to peak before the breakout doesn’t mean the market will never go up again. Some of my friends won’t put a dollar on the market because they were burned. Just because you can no longer bear a loss psychologically does not mean that the market will not rise again. Distinguish between your personal circumstances and the world outside. Just because someone broke your heart doesn’t mean that all men or women are the way you tell yourself. Talk about what your decisions really mean for clarity (e.g., “I am scared and will not forgive myself if I lose more money”) and stop projecting your fears onto the market (e.g. B. “The Markt will never recover”). These two things have nothing to do with each other. Stop protecting yourself and call things the way they are, whether you invest or not.

Bonus hour (and no, it’s not “don’t invest what you can’t afford to lose”):

12 lessons to win and lose $ 12 million in cryptocurrencies12 lessons to win and lose $ 12 million in cryptocurrencies

Be proud to have followed your guts and listen to your heart regardless of the outcome. Of course, losing so much money is disappointing, and most people would probably know better. The question of change is: how many of them would have been able to lose that amount at all?

For me, investments – and life – are a compromise between risk reduction and opportunities. Which of these two options is more exciting for you when you invest? I know that I don’t like missing out on something, so I have to have a high risk tolerance if I want to sleep at night.

Some of the people who love me the most (especially my parents) can’t stop saying, “I told you you should have sold.” It should have been sold, but not at 40% or 300% profit, which they would have done. I’m not in crypto for that. However, I can agree with the fact that I should have sold more with a profit of 10,000%.

Some of my friends also regret not selling at the highest point. One of them said to me: “If we hadn’t celebrated that evening in December 2017, we would have sold all of them.” That’s right, but how much fun I had treating all my friends that night! Epos. These months in spring and winter 2017 and then in January 2018 with CoinMarketCap in green all along the line … Nobody knows how much I enjoyed this journey upwards. I can’t wait any longer and I’m done. I am ready to go back up and this time there is no going back.

This article does not contain any investment recommendations or recommendations. Every step of investment and trading involves risks. You have to do your own research when making a decision.

The views, thoughts and opinions expressed here are solely those of the author and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Richard Vitoria He is an angel investor and evangelist in the blockchain space. Since entering the industry in 2014, he has invested directly in more than 20 projects, including Ethereum and Polymath. He is currently the CEO of a private fund that invests in digital assets and blockchain companies that change the world.