1. About Earnings

If the initial capital is 1,000,000, when the earnings reach 100%, the assets will grow to 2,000,000. However, if a subsequent loss of 50% occurs, the assets will fall back to 1,000,000. It is not hard to see that a 50% loss is significantly more difficult compared to earning 100%.

2. About Price Fluctuations

Assuming the initial capital is 1,000,000, if it rises by 10% on the first day, the assets will reach 1,100,000; however, if it drops by 10% on the second day, the assets will only be 990,000. Conversely, if it drops by 10% on the first day and then rises by 10% on the second day, the final assets will also be 990,000.

3. About Volatility

If one starts with 1,000,000, earning 40% in the first year, losing 20% in the second, earning another 40% in the third, losing 20% in the fourth, earning 40% in the fifth, and losing 20% in the sixth year, the assets will ultimately remain at 1,405,000, with an annualized return of only 5.83% over six years, which is even lower than the coupon rate of a 5-year treasury bond.

4. About Earning 1% Daily

If the initial capital is 1,000,000, and one can achieve a profit of 1% daily and then exit, after 250 days, the assets can reach 12,032,000, and after 500 days, the assets can grow to as much as 145 million.

5. About Earning 200% Annually

Assuming an initial capital of 1,000,000, if one can achieve a 200% return for five consecutive years, after five years, the assets will reach as high as 243 million. However, it should be noted that maintaining such high returns is very difficult in reality.

6. About Averaging Down

For example, if one buys a cryptocurrency for 10,000 yuan when the price is 10 yuan, and then buys another 10,000 yuan when the price drops to 5 yuan, the average cost of that cryptocurrency is not the expected 7.5 yuan but can be reduced to 6.67 yuan.

7. About Holding Costs

Assuming the initial capital is 1,000,000, if one invests in a cryptocurrency and makes a 10% profit, when deciding to sell, if one retains 100,000 yuan in market value, the holding cost will turn to zero, allowing for long-term holding without pressure. If one is extremely optimistic about this cryptocurrency and retains 200,000 yuan in market value, the profit percentage will increase from 10% to 100%. But do not celebrate too early, because if the cryptocurrency drops by 50% later, there is still a possibility of incurring losses.