The Daily Gwei - Proof of Profit- The Daily Gwei #396
Proof of Profit- The Daily Gwei #396Contrary to popular belief, crypto investing isn't actually easy.I believe that the old adage “time in the market beats timing the market” suits the crypto market so perfectly even though crypto also has the highest concentration of people who try to time the market. Whether it’s over-trading, getting blown up using leverage, averaging losers or just holding onto an asset for far too long - most people will actually lose a lot of the money they make and will also severely under-perform a benchmark index asset like ETH. I think that the crypto markets have warped many people’s sense of investing and convinced them that it’s an easy endeavor when in fact it’s incredibly hard to be a good investor. And I mean - who can blame them - during really bullish periods you can throw money at just about anything and make a gain of some kind. Though it’s always the comedown that gets people - the long, slow bleed of their portfolio as the asset that everyone once thought was the holy grail turned out to be nothing more than over-hyped and overbought. This is really where most people lose their money - holding onto a position for far too long that bleeds out against USD (or any other fiat) and bleeds out even harder against something like ETH or BTC. I personally know people who have held assets for years that are now down 95%+ against ETH and they are still convinced that they will get “one last pump” to exit their positions - this is obviously very dangerous thinking. I personally benchmark my investments against ETH because if I’m not outperforming ETH over the long-run (being 1 year at the very least), then what was even the point of entering into a position of a much riskier asset. On top of this, my taxes are denominated in fiat (AUD) so to outperform ETH with other assets I have to factor in taxes into the equation which just makes it even harder. Couple that with the fact that most crypto-assets are tied to projects that will fail (as most startups do), it becomes even harder to outperform ETH. Of course, this isn’t to say you can’t outperform ETH by speculating on other assets, but being conscious of when to take profits is what gives you a much better chance of winning. The reason most people never actually net out positively from actively trading is because they are unable to keep their emotions and biases in check. They let fear & greed dictate trades, allow biases to cloud their judgement and get big egos if they hit one big lucky trade which just results in them over-trading. Many people also blow themselves up with leverage since basically every exchange out there offers these services to brand-new investors who have absolutely no business leverage trading. Though this is the nature of the beast - one giant global casino with the professionals feeding on the fresh meat of retail until they bleed out and the cycle ends for a period of time and the market enters a downtrend. I’ve made plenty of mistakes over the years - falling for pump & dumps, buying into borderline scams, holding onto assets for too long - but how I survived was learning from these mistakes and being conscious of when I’m feeling fear and when I’m feeling greedy. These 2 emotions are probably responsible for most of the losses that people incur in crypto and you can see this playing out whenever there’s a big liquidation event - lots of over-leveraged people just getting wiped out because of their greed. On the flip side, lots of people will “panic sell” when prices are falling rapidly which just confluences with the greed to create those scary dumps we all know too well. Now, everything I’ve said above isn’t to be taken as investment advice, but this commentary is the result of my own journey with investing in crypto and it took many years for me to optimize my strategy so that I could actually keep the profits I made. It’s also helped me to not throw away any of my precious ETH and also stack more of it through some targeted investments in other assets. I hope that you can learn something from these lessons and apply them to your own strategies - after all, your worst enemy and best friend in investing is yourself. Have a great day everyone, Enjoyed today’s piece? I send out a fresh one every week day - be sure to subscribe to receive it in your inbox! Join the Daily Gwei EcosystemAll information presented above is for educational purposes only and should not be taken as investment advice. If you liked this post from The Daily Gwei, why not share it? |
Older messages
Optimizing Ethereum - The Daily Gwei #395
Wednesday, December 8, 2021
Getting as much juice as we can out of a hardware-constrained Ethereum.
The Global Empire - The Daily Gwei #394
Tuesday, December 7, 2021
We're in the decentralized empire business.
Organically Grown - The Daily Gwei #393
Monday, December 6, 2021
Is your community grass-fed?
Yelling at Clouds - The Daily Gwei #392
Friday, December 3, 2021
The future is now old man.
Cultured Beginnings - The Daily Gwei #391
Thursday, December 2, 2021
It's all about the culture.
You Might Also Like
Mingdao: Transforming Illusions into Reality - Discussing MicroStrategy's Grand Strategy
Monday, November 25, 2024
MicroStrategy has truly hatched the biggest golden egg in this crypto cycle, with paper profits exceeding $15 billion in less than two years. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Finish signing in to Crypto.com DeFi Research
Monday, November 25, 2024
Here's a link to sign in to Crypto.com DeFi Research. This link can only be used once and expires in one hour. If expired, please try signing in again here. Sign in now © 2024 Crypto.com 1
Polymarket: A revolution in prediction markets
Sunday, November 24, 2024
CryptoSlate's latest report explores Polymarket's evolution, its role in high-stakes prediction events like US elections, and the impact of its controversies on its market position. ͏ ͏ ͏ ͏ ͏ ͏
Asia's weekly TOP10 crypto news (Nov 18 to Nov 24)
Sunday, November 24, 2024
The Japanese government has announced plans to advance a new economic stimulus package, expected to receive approval by the end of 2024. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
A Distinctive Black Flag Brand | Black Flag DAO Weekly Rollup
Saturday, November 23, 2024
Catch Up With What Happened This Week in Black Flag DAO ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Blockchain Association urges Trump to tackle crypto reform in first 100 days
Saturday, November 23, 2024
The association sent a letter with five priorities to the President-elect, including regulatory clarity and ending crypto firms' "debanking." ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Weekly Project Updates: SOL Reaches New All-Time High, Magic Eden to Hold TGE on December 10, 10 Trillion BONK Tok…
Saturday, November 23, 2024
Bloomberg ETF analyst James Seyffart shared that Cboe has filed applications with the SEC for four Solana spot ETFs, with issuers being VanEck, 21Shares, Canary Capital, and Bitwise. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Galaxy Digital CEO Mike Novogratz says Bitcoin reaching $100,000 is ‘just the start’
Friday, November 22, 2024
Galaxy's CEO also warned that the market is currently heavy with leverage, with a correction until $80000 being possible after the $100000 is surpassed. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
👂 Your Voice Matters! Help Us Improve Our Newsletters
Friday, November 22, 2024
Your feedback helps make our reporting more insightful. ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏
Reminder: Bitcoin Becomes 8th Largest Asset Globally After Surpassing Silver
Friday, November 22, 2024
We bring you the top stories in crypto every week! Stories like... Tuesday Nov 19, 2024 Sign Up Your Weekly Update On All Things Crypto TL;DR Welcome to this week's edition of CryptoWeekly Recap,