I think there are several reasons:
1) You have a light BTC position, or even no BTC, but a lot of altcoins. Or you originally had BTC, and you switched to altcoins during the rise, thinking you could earn more.
2) You bought the altcoin during the surge, not before the surge. So when the price drops, the price drops sharply, and you can easily lose 30% or even 50% of your capital.
3) You have a light position at a low price, and after making a profit, you start to increase your position after it has doubled or multiplied several times, and you do not take profit at a high price, but expect the market to rise more, but it actually falls. In general, your light position rises with the market, and your full position falls with the market, and your return rate lags behind the market average return rate.
4) You may have lightly invested in a meme coin and experienced a 3-5 times, or even a 5-10 times increase. After exiting at a high, you believe you can catch the next one and multiply your assets again. As a result, you end up giving back most of the previous profits the next time. Therefore, after one cycle, your asset return rate still lags behind BTC.
Where is the problem?
Return expectations. The vast majority of people always believe they can outperform the market average return (BTC), which is why they buy altcoins. Otherwise, they could just invest fully in BTC. However, from a rational perspective, the market is a zero-sum game, where a few earn the money of the many, so the returns of most people will inevitably underperform the average return. The stock market is the same; the vast majority cannot outperform the SSE 50 or the S&P 500.
What should be done?
An objective and correct understanding of the market. Currently, the cryptocurrency market has a market cap of 4 trillion USD, which is much larger than the peak points of the bull markets in 2021 and 2017. Where does this much capital come from? Traditional financial institutions, like BlackRock, which has an asset size of 12 trillion USD. Once they enter this market, it will inevitably manifest as institutionalization and characteristics similar to the US stock market.
Revisiting the continuous rise over several months in 2017 and 2021, where most assets surged 10-fold, 50-fold, or even hundreds of times, is akin to looking for a sword on a boat. According to my own judgment indicators, the current trend has broken the typical rising characteristics of the past two bull markets, and we must adopt new concepts to respond to the current market.
The method is simple: observe market sentiment. If the price rises significantly, sell; do not expect to sell at the highest point of the bull market. If the price falls significantly, buy; do not expect to buy at the lowest point. This strategy cannot maximize your returns because you may sell only to find the market continues to rise. However, since you are selling in batches, your actual rate of return is more like the 10-day or 20-day moving average of the total value of the assets held, as shown in the diagram below. This way, the money you earn when the market rises is really in your hands and will not be given back to the market when it falls (though you may give back a small portion to the market, which is still acceptable). The overall asset return curve rises slowly, which I believe is reasonable and should be the pursued return curve. There is also insider information about a certain coin expected to launch in the next couple of days, leaving behind a chance for entry at 333.
