In the previous cycle, I successfully reached half of A9 and achieved a ROI of nearly 40 times. However, the 519 incident and the two-year bear market caused me to lose nearly half of my assets. Every bull market makes people wealthy, but soon they lose everything due to inflated mentality. Next, here are my 10 strategies on how to preserve profits and stay in the market forever:
1. Smart diversification: Cryptocurrency is a high-risk field, so it’s crucial not to go all-in on 1 or 2 coins, even if they were once in the top ten by market cap, like #LUNA. Maintaining a balanced portfolio and weak correlation is key, while determining your investment portfolio and maximum quantity based on capital size and risk tolerance.
– For $5,000-$50,000: around 10 coins
– For $50,000-$500,000: around 20 coins
– For over $5,000,000: within 30 coins
Also, focus on the areas you are familiar with and the core narratives of each cycle, such as #AI #RWA #DEPIN #GAMEFI #SOL #MEME in the years 2023-2025.
2. Regular portfolio rebalancing: Investing, especially in cryptocurrencies, is challenging due to its fast-changing nature. It is essential to regularly track and rebalance your holdings. Use a data dashboard to connect your holdings through on-chain API interface data and customize your dashboard. Follow official Twitter accounts and communities to stay updated on the latest developments.
3. Risk management: Establish feasible risk control strategies with #BTC as the main reference. Set withdrawal thresholds for overall positions to avoid empty efforts. Remember to maintain independence between risk control managers, operators, or researchers, or automate execution with computers. Avoid emotional attachment and nostalgia when implementing risk control. Our strategy is the 230 program (similar to a private equity fund) with a 20% drawdown warning and 30% execution for BTC as the benchmark.
4. Be cautious in greed and greedy in fear: Market always faces FOMO and FUD. Due to the unregulated environment of cryptocurrencies and the prevalence of social media, there are constantly emerging voices. However, investing often goes against human nature. For example, on May 1st, when BTC dropped below $59,000, FUD was severe, and many people saw $50,000 or even $40,000 without logical and technical analysis. If technical analysis could beat the market, many people would already be millionaires, especially with the support of #AI. Therefore, independent thinking and comprehensive analysis of macro, micro, data, and funds are necessary to make market judgments based on probabilities.
5. Pay attention to market sentiment: In the market, we often make money in two ways, through emotions and cycles. The former determines the rotation of the track, often triggered by events, while the latter determines asset allocation and profits in cycles. Identifying the end and start of market track rotation is crucial. For example, the recent RWA hype caused by BlackRock led to significant gains for RWA projects like #GFI and #RIO within a week. However, after the hype, there will be a swing effect, and it will dissipate. At this moment, it is crucial to double the principal or implement dynamic balance strategy promptly. Experience here includes tracking search indexes, Twitter discussions, and smart money movements.
6. Stay hungry, stay learning: Focusing on your own track is essential. “A pint of water is worth more than a gallon of wine.” Everyone’s energy and learning capacity are limited, and it is impossible to be knowledgeable in every area. It is important to focus on your own track, such as #AI #RWA #SOL ecosystem #DEPIN #GAMEFI, even though there are other hot tracks in the market, such as #Restaking, #MEME, and #Modularization, that we are less involved in. The best approach is to seek an organization where everyone can work together, build a team with talented individuals supporting each other, and regularly participate in activities to learn from experienced professionals.
7. Protect your assets: Safety always comes first. It is recommended for users with more than $100,000 to use cold wallets. Any exchange carries risks, and the safest way is to control your own assets. Learn from large institutions that always store assets in cold wallets, while exchanges are merely intermediaries for trading. Assets are only transferred to exchanges when necessary. Otherwise, they are stored in cold wallets. This is the lesson from FTX, where many people, including myself, suffered heavy losses.
8. Take profits: This is crucial. It is important to plan and anticipate in each cycle, knowing when to take action instead of always rushing forward. In the market, there are times to rush and times to stop, and stopping is more important. Our prediction for this cycle is to plan profit-taking at two points:
– When the price exceeds $120,000, take out 10% of the position for every 10% increase.
– In the 2nd or 3rd quarter of 2025, liquidate the entire position in this cycle.
9. Be patient: Investment is a long-term endeavor that extends the dimensions of life, just like Warren Buffett’s thinking and investment. Always remember to make money in cycles, as this is the secret to consistent success. The cycle is like a pendulum that never stops. The world is a continuous drama with slightly changing plots and characters, but the core essence remains the same. For example, the longest cycle is the Kondratieff cycle, nested within which are multiple Kuznets cycles and Juglar cycles. We always go through recession, depression, recovery, prosperity, and back to recession, just like the well-known Merrill Lynch clock, in a continuous loop. Opportunities always exist, and wealth in life relies on Kondratieff cycles, while efforts have minimal effects.
10. Good health and stable mentality: Technical knowledge can be acquired, but becoming a consistently successful investor is rare. The core lies in mentality and health. Technical knowledge is referred to as variable variables that can be acquired through the 10,000-hour rule to become an expert. However, mentality cannot be quantified. It has innate factors (innate talent) and continuous improvement through practice. The majority of people’s differences lie not in technical knowledge but in mentality. It cannot be taught but can only be realized through repeated experiences of despair and market tempering. Lastly, I wish everyone happy investing and abundant results in the 2023-2025 cycle. Gratitude.