In 2016, when I first got to know blockchain, there was no Binance at that time. There were only OK, Huobi, Yuanbao, JuBi, BitTimes and other exchanges, plus a handful of dozens of altcoins.
After 94 in 2017, domestic exchanges and ICOs were liquidated.
However, at the end of the year, there was a rainbow after the rain. Along with it, many domestic exchanges went overseas and flourished. Cryptocurrency also went from a niche to the mainstream and capitalized with this bull market.
Over the years, domestic exchanges have collapsed one after another. In the past two years alone, dozens of exchanges, large and small, have either closed down or fled. Running away is the norm, and Huobi seems to be the only one to be closed down.
In recent years, the once unlimited silver has been reduced to zero, and most of the earliest copycats have been reduced to zero. Even a powerful company like LUNA, with a market value of tens of billions, has turned into a bubble overnight.
The more experience I gain, the more I understand that if I want to succeed in investing, I must first avoid choosing projects or exchanges that go back to zero.
If it was before 2016, as long as you held positions in OK and a few decentralized wallets such as Dogecoin, Bitcoin and other similar tokens, and held them until today without moving, you would still have very high returns even after two years of bear market.
But you have to choose the right project and the right wallet, and the conditions are actually quite harsh.
Until now, I often see many users who hold millions of Doge on JuBi defending their rights, and there are quite a few of them; many investors still have hundreds of thousands or millions of financial assets in Anyin Exchange, and have lost all their money so far; it is common to pay for EOS by mistake and lose millions.
The longer we stay in this industry and the more bankruptcies we see, the more we understand that being alive is actually the greatest victory.
This circle is extremely risky and challenging, with many pitfalls. The first step in investing is to avoid pitfalls, and the second is to choose projects.
Of course, some pitfalls cannot be predicted in advance, and there is nothing we can do about it, but some pitfalls can be judged in advance.
What we need to do is to avoid these pitfalls.
Let’s not talk about the pyramid scheme coins like Radarcoin and Environmentalcoin, which should have known that they would eventually return to zero. For example, cryptocurrencies like FIL, Chia, and BZZ, which seemed to have good early publicity, actually had a pattern and ending of being harvested from the moment they were launched.
Taking FIL as an example, if people can clearly understand that the essence of FIL mining is to raise funds and share dividends, and that it has some disadvantages such as high pricing, high market value, low cost, and low application rate, many people may not buy FIL worth more than US$200 for pledge mining, nor will they buy mining machines that cost hundreds of thousands or millions of dollars. In addition, they will not buy FIL at the bottom in September 2021 when the country has already clarified the status of computing power mining.
So, to this day, I still often receive inquiries from many FIL miners. They all regret joining FIL mining, but now it is too late.
There is also the recently hyped World Currency WLD, which skyrocketed as soon as it went online and has a very high market value. In fact, it is also a tool for capital to harvest leeks, and many people have already been harvested.
How many media and how many tools have touted the so-called WLD World Coin? This reminds me that there was an Earth Coin in 2016, which was also hyped up very high, but eventually returned to zero.
Of course, the circulation of WLD is still very low, and it is possible that it will be controlled and hyped in the future, but we need to be wary of the same trend as FIL after the second hype.
We talk about or recall the past not to reminisce, but to summarize experience. Projects like FIL, which already have problems, should have discovered the problems earlier, and perhaps a lot of losses could have been recovered.
In fact, there is another important issue, that is, many people may find problems with some projects, but they will be brainwashed, or bound by inertial thinking, or they will not be determined to stop losses.
Some projects and exchanges have problems and may take a very long time to collapse, which is enough to paralyze everyone during this period. As time goes on, people even doubt their own judgment and eventually rush in and get trapped.
In the past two years, dozens of exchanges that have run away have countless users, and many of them may have made this mistake. I have written many articles about warnings of fake exchanges, but everyone seems to ignore them every time. After the collapse, when the money is gone, they come to consult what to do, but it is too late.
In the cryptocurrency world, it is very easy to be confused about whether an investment is right or wrong during the time when the trader is in control of the market. Just like the last drop before every rise and the last rise before the bear market, these can easily confuse people in the short term.
Therefore, it is important to be firm in your heart. You must understand that money in the cryptocurrency world is not so easy to make, and every bad guy wants to harvest you.
There is a prerequisite for being firm in your heart. That is, you must have relatively correct judgment and the right direction, but you don’t need to pursue extreme accuracy excessively, because no one can do that.
During the crazy phase of the market, everyone does not need to study, but in the current market situation, you should enrich your brain and take enough rest time to prepare for the future.
After talking so much, there is actually nothing hot to write about and nothing good to share. My point of view has always been clear: since the end of last year, there have been opportunities in the future. There is no need to be afraid at any time within the bottom box. Of course, try not to choose the upper part of the box to buy at the bottom.
Finally, let me briefly talk about some potential risks. I will not go into the specific analysis, you can find it yourself. But you need to understand that these potential risks may explode sooner or later, no matter how stable it is today.
1. Risk of holding too many single stablecoins. In short, never over-trust any single stablecoin, which is a product of companies controlled by centralized capital and has a very small risk of decoupling and explosion.
2. Before the lawsuit between the SEC and Binance and Coinbase exchanges is over, there is a risk that "security tokens" may be delisted. In addition to XRP, many tokens listed as securities are backed by American companies, and their issuance methods do violate securities laws. Therefore, they may be delisted by Binance and Coinbase or listed as restricted areas.
3. Sun Ge owns TRX, P-net, Huobi, USDD stablecoin, BTT, Sun, NFT and other tokens and exchanges. There is a Chinese idiom called "karma cycle". Everything we do will be paid back in the future. This is the way of heaven, and no one can escape it. In short, Sun Ge is deeply involved in the currency circle, and his harvesting methods are extremely brutal. The problem is very serious. He has been hyping it up, which is actually exchanging time for space.
4. Imitating ETH public chain and no innovative projects. The continuous upgrading of ETH will slowly squeeze out the survival value of many public chains, including TRX and SOL. Operators of public chain projects will easily run into problems as long as they are overly profit-oriented and centralized. The project owners of SOL and TRX have such problems, always putting money-making and harvesting first. I think these two risks are the biggest among the top ten in market value.
It is now the third quarter of 2023, and the bull market at the beginning of the year has been in correction for two months. The next round of bull market may be violent, but many will also return to zero and be eliminated.
As ordinary retail investors, our biggest risk is not missing opportunities, but catching a zero-based project. As long as we don’t take this wrong step, we can be the biggest winner without doing anything.