Cryptocurrency Influencers and the ‘National Exchange Contract’ Trap
Some KOLs use their ‘influence’ to support national exchanges and engage in national exchange contracts, but in essence, they are acting as counter parties, forcing retail investors out by requiring infinite margin increases. I've seen quite a bit of this in the industry, including those long-term KOLs who have their fans engage in a national exchange coin contract, basically apologizing to fans washed out on Monday and showing off on Friday how much they earned after adding margin, making those who got washed out feel regretful for not adding margin. Is it possible that you are their long-term cash cow? While collecting your fees, they are leading you to act as counter parties against the national exchange's dog coin. Think a bit about why they dare to infinitely increase margin to hold positions, consistently engaging in contracts for one coin.
If you decide to invest in Bitcoin layer two projects, especially those from Chinese exchanges, you need to be psychologically prepared for significant volatility or even massive losses. Projects from Chinese exchanges are extremely high risk, and leveraging is akin to ‘gambling with your life’, so try to avoid it.
For newly launched or significantly appreciated Chinese projects, you can wait for a price correction or even a tenfold drop before considering entry.
Try to distinguish between the different performances of Asian coins and American coins through daily charts, trading depth, and other data.
There is no discrimination; last year I even saw someone on the other side of the ocean leading people to engage in contracts on Weibo, claiming to provide incredibly accurate points, but later that group got liquidated. My little buddy was also affected by that guy's friends who had Ferraris, young models, and yachts, looking no more than 20 years old, and he is from Jiangsu. It's best to avoid investing in leverage on national exchanges, as it is akin to self-harm.
Many people say that numerous projects support a group of KOLs to lead people into contracts; they are not deceiving you, it is indeed very common. Also, do not envy those engaging in contracts for single coin clones A8, A9; when the market is bad and they can lose thousands of USDT daily in market cap management, how could they possibly provide you with counter party for A8, A9.