Unwinding, as a term in the cryptocurrency circle, refers to the act of selling a cryptocurrency when its price rises back to the buying price in order to recover funds. Learning to trap is to truly learn to hunt; learning to unwind is to truly understand trading cryptocurrencies.

Below are methods for unwinding, generally divided into two types.

1. Active unwinding strategies

1.1. Cutting losses

If it is realized that the purchase was a serious mistake, especially if bought at the peak of a significant bull market during a prior surge, one must have the determination to cut losses and sell promptly to ensure the safety of funds. There are numerous opportunities in the cryptocurrency market; as long as funds do not suffer major losses, one can always earn back the money.

1.2. Switching coins

When the cryptocurrency held is in a losing position and still has room to drop, if one accurately judges that another cryptocurrency has significant potential for an upward trend and stronger performance, one can decisively switch coins to offset losses from the old coin with profits from the new one.

1.3. Short selling

When it is determined that one is deeply trapped and cannot cut losses, and there is potential for further decline in the overall market or a specific cryptocurrency, one can adopt short selling, first selling the trapped cryptocurrency, and then buying it back at a lower position to effectively reduce costs.

2. Passive unwinding strategies

2.1. Averaging down

If the buying price is not high or there is confidence in the future market, one can choose to use the averaging down technique. However, ordinary investors can usually only endure one or two rounds of averaging down, so the timing for averaging down is crucial.

2.2. Waiting it out

When heavily trapped and unable to cut losses or add to the position, one can only wait passively. As long as it is one's own money, not borrowed or loaned, there is patience to wait. One must not act emotionally, giving up or blindly adding to the position or cutting losses carelessly. Being trapped is not terrible; sometimes not being trapped means not making money, and being trapped might actually lead to significant profits.