What is the most authentic approach in the crypto world?
I have always advised everyone that beginners should use small amounts of capital to practice, at least to minimize losses. Many people think that 'hanging on' is easy, but in fact, it requires resisting many temptations. If someone truly has the ability, who would want to just hang on? Who doesn't want to go all in and occupy the palace? But the reality is that most people cannot do this. In the market, do not focus on the market's increase; the key is how much you personally can take, what you actually pocket is what truly belongs to you.
You can win many times, but as long as you lose once, you may wipe out all your previous earnings.
So how to trade 'steady as a rock'?
1. Timely stop-loss: Control the loss amount and reduce the maximum drawdown; this is the most critical point.
2. High win-loss ratio: The profit from a single trade should be greater than the loss from a single trade, maintaining a good win-loss ratio.
3. Trailing stop-loss: Preserve profits until the market reverses, aiming to capture the complete market trend.
4. Continuous repetition: Consistent strategy, stick to execution.
About the 'Impossible Triangle of Excess Returns'
There is a theory called the 'Impossible Triangle of Excess Returns', which states that a strategy that can make big money can only satisfy two of the following three points:
1. Continuously effective
2. Well-known
3. Simple to execute
If you meet points 1 and 2, then execution is definitely not simple; for example, some people have inherent advantages and can obtain cheap chips in advance, or they have strong high-frequency trading skills where just being faster than others can make money.
If you meet points 1 and 3, then there must be opportunities that others do not know about, which is essentially an information gap; many small start-up businesses rely on this.
If you meet points 2 and 3, then it is very difficult to be continuously effective; many patterns and indicators are sometimes accurate and sometimes not, which is the reflexivity of the market, as the market adjusts based on participants' behavior.
The essence of making money actually boils down to three points:
1. Do what others cannot do (there is a threshold)
2. Think of what others cannot think of (cognitive advantage)
3. Persist in what others cannot endure (grit and perseverance)
In the crypto world, no matter which path you choose, the key is to maintain a steady mindset and keep a good rhythm; do not think about achieving everything in one go.