Knowing market rules but still can't make money? To succeed in encryption investment, you need these core abilities first.

Question: If the past events were to be repeated in exactly the same way, wouldn't it be too easy? How can everyone get rich so easily?

Answer: Even if the past events were to (once again) unfold exactly the same way, they would not become wealthy so easily. This is much harder than it seems.

Independent thinking

Only less than 5% of people can truly think independently, and this ability often requires the following steps:

Establish a solid epistemological foundation

Collect original data

Narrow the scope of the strategy using the original rules

The relationship between things is clear.

These steps are very difficult for most people. They have never tried, don't know where to start, have no relevant experience, and don't have the confidence to make their point stand out in the external noise.

Without this kind of characteristic, you basically have no way to start in the cryptocurrency industry. Even the simplest and most logical data sets (such as LTC charts - the first altcoin, and the "code" followed by all subsequent currencies) may seem as complex as an unsolved mystery to you.

IQ and relationship handling ability

In a sense, intelligence is a kind of empathic ability. You need to grasp the intentions of the questioner and understand the relationships they are trying to convey.

In the cryptocurrency market, the issuer is the participant of the whole market. People with high IQ can quickly discover relationships that others may never perceive.

For example, trying to explain the equation 3x = 6 to a dog is meaningless because it cannot understand abstract concepts like 'dividing both sides by 3'.

On the same principle, can you 'see' the distribution of emotions, gains and losses, and the overall trend behind it by observing a chart? If you can, you can infer the future market trends from it.

Powerful strategic thinking (Meta game)

Many intelligent people, although capable of independent thinking and discovering relationships, have a weak overall strategic mindset.

Here are some typical failure cases:

Developers believed that their technical abilities could give them a competitive advantage in the market.

Thought Leaders: Despite their high status, their past investment records are dismal.

Successful people: for example, can people like Paul Graham really find the right investment answers?

The Eliminated Group: This happens to almost everyone, just like professional athletes eventually lose their peak state.

Human beings are inherently flawed and unable to fully understand and accurately model complex market systems. To avoid these pitfalls, you need strong strategic thinking to help you filter information and assign its importance.

Risk in execution

Successful execution requires the following basic abilities:

Most people with startup capital are relatively stable in their lives and cannot easily invest their funds in high-risk cryptocurrency trading.

If you have a happy family life and a respected profession, the potential benefits of participating in cryptocurrency trading may be far lower than the potential risks.

There are many classic pitfalls in trading, even those with advantages may fall into them, such as:

* Regard profits as "casino money": Truly calm people will buy Shiba Inu coins for $300 and rise to $30 million, and stacking the same Shiba Inu coins with a family fortune of $30 million is considered exactly the same thing.

* Take action at critical moments: There are always similar patterns in the market. Many people know that they are in a bad trade or holding, but they hesitate to take action. "Oh, it dropped 40%... oh, it dropped 70%... oh, it dropped 65% from the historical high... oh, it dropped 85%... What should I do?"

How to avoid bankruptcy caused by external factors

Look at the list of major Bitcoin holders, how many people do you think still hold their bitcoins?

Bitcoin Top 500 Holders: Top 50

980,000 coins*. Satoshi Nakamoto

400,000 coins*. HD Moore (AHA)

400,000 coins*. Dustin D. Trammell (AHA)

400,000 coins*. Tod Beardsley (AHA)

350,000 coins*. Also known as "Dread Pirate Roberts" or "DPR".

300,000 coins. Roger Ver

300,000 coins*. 'knightmb'

200,000 coins. Mark Karpeles 8.5 182,592 coins. 「Loaded」

174,000 coins*. FBI (Federal Bureau of Investigation)

119,000 coins. 3 members of the AsicMiner management team (specific names unknown)

Common causes of bankruptcy include:

Being hacked

Exchange Misappropriation of User Funds (Similar Cases Abound)

Legal dispute

Tax issues

Why do almost all key figures in the cryptocurrency industry either receive legal subpoenas, disappear under suspicious circumstances, fall victim to scams, or get arrested?

In fact, preserving wealth is not an easy task. If you want to keep your Bitcoin forever, it seems that 'early death' is the safest way (this is ironic).

So how do people get rich through cryptocurrency?

Most of the people who get rich through cryptocurrency actually have a big misunderstanding of the market, but they happen to seize the opportunity at the critical moment.

Many people invest in Bitcoin because they say, 'You can use it to buy coffee' or 'It's a hedge against inflation,' or other popular arguments that come up every cycle, but these reasons haven't actually materialized.

If you thought in 2010 or 2012 that Bitcoin was a novel concept verification technology, which accumulated actual demand through the dark web market, proving its feasibility, and gradually triggering a series of speculative bubbles, then your judgment was correct.

However, at that time, there were not many people holding this view.

Some people invested in Ether very early on, simply because their high school poker friends told them it could be used to support decentralized games or other application scenarios. Others believed that Ether would become an unstoppable smart contract platform (until the ETC fork incident happened).

However, these ideas have hardly been realized. The vast majority of early 'whales' either sold their assets at low prices or experienced asset shrinkage of up to 95%. This indicates that they lack a deep understanding of market operations and do not have a clear investment strategy.

This article is authorized for reprint from: 'TechFlow'

Original author: Puffy

Do you know the market rules but still can't make money? To be a successful cryptocurrency investor, you need to have these core competencies first. This article was originally published in 'Crypto City'.