Author: FC_0x0, Source: Author's Twitter @FC_0X0
As one of the most famous and mysterious traders in the Crypto field, GCR started with $1,000 and invested up to $100 million.
It turns out his trading strategy is like this.
I've heard of GCR for a long time, but I want to understand him systematically, not because he made $100 million, but because I saw an article by @7upDAO, which mentioned some untold stories.
It turns out that GCR was not a trader by profession, it turns out he has said so many golden sentences, and he also has a small group, this series of curiosity, let me start to study GCR, today I will tell you his story, hoping to help your trading.
GCR inherits his name "Gigantic-Cassocked-Rebirth" from the FTX exchange, and he has never publicly discussed his background. In early 2021, GCR began to be active on Twitter, posting his judgments on the market and details of his trading activities. At that time, he was not famous, and he only had a small number of followers on Twitter.
From the beginning, he has been a loyal fan of contrarian trading.
One of his earliest posts detailed how he shorted the GameStop (GME) stock driven by retail investors in January 2021, which is also one of the typical representatives of his contrarian trading.
On Twitter, he mentioned that he initially only had $1,000, and all his wealth growth came from trading. For him, trading is the only viable thing.
GCR says he is a hard-working person. When the market is doing well, he encourages other traders to spend more than 120 hours a week to hone their skills. He encouraged his readers to take a break at the end of 2022, but he said he hasn't rested a single day in nearly 3.5 years.
How is GCR's trading style?
GCR is known for his contrarian trading, often choosing to short when the market is generally bullish.
He emphasizes the importance of patience and finding unique advantages, and it is this strategy that has allowed him to succeed in the volatile market.
In his 2021 tweets, he often mentioned a concept of the "Tree of Life", which is the key to finding opportunities in the market. Many people began to speculate on the meaning of this concept, and later GCR said that the "Tree of Life" is actually just a willingness to bet against the consensus view.
He realizes that in the market, the views of the majority are often wrong, and the real opportunities are often hidden in the opposite direction of the consensus. GCR's contrarian thinking strategy reflects a deep understanding of the mainstream public behavior in the market and an accurate grasp of group psychology.
He is also a loyal fan of George Soros, often mentioning Soros' views and discussing the concepts of reflexivity and contrarian thinking. GCR is deeply influenced by these theories and applies them to his own trading strategy:
To find profit opportunities and opportunities in the market through contrarian thinking, and to achieve success through trading decisions that are different from the crowd.
In fact, I heard this view in an interview with @benchmark, which is called "Non-Consensus Investing". In fact, my purchase of Polkadot and everyone's purchase of SOL last year were "non-consensus investments".
So what is "non-consensus"? I think the best criterion is when a group of people form an opinion but without logic, then you can start to pay attention, maybe this is a good opportunity.
About GCR's small group
In October 2021, GCR began recruiting members for a new team, which is RebirthDAO, with the goal of forming a decentralized hedge fund by combining the power of many highly successful traders in the Crypto market.
RebirthDAO's first trade was a news trade in October 2021 (identifying and capitalizing on the approval of the Proshares BTC futures ETF), which GCR said was very successful, as they received an alert that pushed BTC prices from $57.1K to $59K, giving them a precious time advantage of a few seconds over other news traders.
In the group, GCR is very strict.
Most group members are large traders, with asset sizes possibly reaching tens of millions or even billions of dollars. The group mainly discusses price-related topics, and he requires rigor for every word, but occasionally also involves other issues, such as whether the US ZZ or Trump-like figures can be elected.
In fact, GCR has two small groups, one of about 50 people, and another small group of about a dozen people. There are some European traders in the group. The European traders can be summarized in two characteristics:
First, Europeans may have a certain mysterious self-confidence;
Second, many of Europe's cognitions and cultural preferences may have a touch of cynicism due to the sparse population.
In fact, Europe does not have much influence on the market, although Europe also has some good traders, but the biggest influence on the market is still the traders in the United States, including Wall Street and so on. GCR said that it was the CEO of BlackRock who saved the ETF, otherwise the bull market cycle would not have come so quickly.
And in this group, the members' weekly speech count will also be counted, and the people in it will be forced to make several price predictions every week, and then they will be reviewed and ranked, and the bottom 20% will be kicked out every week. In summary:
First, control your information input;
Second, find your own alpha following.
Through RebirthDAO, GCR began to try to profit from what he considered an overheated Altcoin market. At that time, the total value of the Crypto market exceeded $3 trillion, and GCR was looking for coins that would have a large number of new coin issuances in 2023, and had his DAO team collect as much information as possible about the unlocking of token issuance volumes.
RebirthDAO did not choose to short the largest market cap BTC or Ethereum, but planned to short the weakest batch of Altcoins in the market. GCR said he is most interested in the tokens with the largest issuance volumes in the first half of 2022.
The research team used various means to collect this information, not only by checking documents, but also by analyzing on-chain wallets and even directly contacting project team members to understand their token issuance scale in 2022.
Sometimes GCR will use code words, mentioning a certain time period or a certain coin, and the group members need to go and research to understand what happened during that period and which coins may be affected. Larger traders usually won't tell you the answer directly, but give some hints, and you need to interpret them yourself.
GCR's Brilliant Track Record
The most famous story about GCR should be what happened in 2021. At that time, he started to be bearish on the market and short some Altcoins at the market top, and made a lot of money as a result, earning him the title of "Short Master" and becoming a "legendary trader".
During the 2021-2022 period, GCR was active on the FTX exchange, and his name was always on the top trader leaderboard of FTX.
But GCR has always maintained an anonymous identity, just as mentioned earlier, he has publicly stated through social platforms that he has no background, started from $1,000, and accumulated wealth through trading in the Crypto market. It is said that his highest assets reached $124 million.
GCR once predicted that if 20 ETH were invested in SHIB and held for 5 months, a return of $40 million could be obtained. In the end, this prediction was verified, and only 2 ETH could achieve it.
During the period of April and May 2021, he issued many bearish warnings, strongly opposing the "super cycle" view that was "popular" in 2021, represented by 3AC's Su Zhu and other traders.
His reasons for supporting his position are sometimes very simple, just the opposite of the "mainstream market view".
One of GCR's most famous trades in early 2021 was shorting DOGE on May 9, 2021, the day Elon Musk appeared on Saturday Night Live.
In the second half of 2021, GCR turned bearish, publicly issuing advice, reminding traders to pay attention to his previous warnings - to reduce trading in adverse conditions, and not to have any illusions that Altcoins can have "independent market conditions".
On July 15, GCR posted his very famous 2022 bear market forecast in his small group, mentioning that "there will be a long and profound bear market, with even the strongest projects having little breathing room."
"The local bottom will be around $20,000... the macroeconomic/stock market top in 2022,... most Altcoins will drop 95% or 99%."
However, GCR's bearish attitude does not mean he will leave the Crypto market, on the contrary, although he remains optimistic about the remaining opportunities in the 2021 market, his strategy shifted in the second half of 2021 to utilizing the outflow of market liquidity to take short positions. Since then, he has been heavily shorting Altcoins that are weak or strong relative to BTC.
In August, GCR began speculating on NFTs, in addition to attempting to purchase hundreds of "Pudgy Penguins" NFTs, his address also won a "Sad Doge" NFT in an auction, which he sold for $2 million a month later.
However, he commented that NFTs are a very difficult asset class to gain exposure to, he said: "My NFT investments are in the millions, but less than 1% of my net worth, and are part of my broader barbell investment strategy."
In November 2021, he publicly shorted SHIB.
In 2022, GCR shorted LUNA for $20 million, ultimately making a huge profit, this trade becoming a landmark case in his career, demonstrating his precise market judgment.
GCR's predictions are numerous and highly accurate, which is one of the reasons he has been "deified".
For example, he predicted in mid-2023 that Trump has a 90% chance of being elected the next US president, and according to current trends, the probability is actually quite high. GCR bought Trump's MEME COIN at $0.1 or $0.2, and it is said that he has already made over $35 million in unrealized gains. He also predicted the emergence of @friendtech.
GCR's Trading Philosophy
GCR often shares his trading philosophy on Twitter, which at first glance seems to be obvious conclusions. But if you can actually apply them to trading practice, you will have very good returns.
1. The key to success is to buy in quickly and early
To trade MEME, you need to buy in immediately when an interesting early token/narrative appears, and then sell it at the peak of the hype. Buying in after the hype has already started is the biggest mistake.
"People fail because they do the exact opposite: they enter the market slowly, and then become more and more greedy over time, eventually going All In."
2. Firm Belief
Cryptocurrencies have become very popular, with funds like Black Rock starting to invest in cryptocurrencies and the RWA field. When you feel that Bitcoin will never rise again, you should do your best to prepare for the bull market.
After the FTX collapse, when SOL fell to $8, GCR bought 6,000 SOL and chose to continue to believe, holding until SOL reached $100, thus making the easiest $550,000 of his life.
"When people no longer believe in the future, that is the peak of the apocalypse."
3. Hype New Coins
There will be many new coins in the bull market cycle, and if you see a project with huge potential, the next step is to analyze: "Is this team wealthy enough, or do they have the motivation to hype the token?"
If so, the team needs to become more prosperous, and you can continue to believe in the project.
4. "Bad" does not always mean defeat
Projects that have taken a long time to build may create the worst token economics in the world, but the token performance may be better than other projects. This may be because the project has waited too long to get a good market to make a profit.
Therefore, do not cross out such projects from your watch list, they can bring you more returns than you think, such as $ARKM.
5. Reaction > News
When you see major news reports or announcements, you don't need to check their accuracy.
"When news affects prices, market participants often focus on whether it is true. Many times, the truthfulness of the headline is not important. The market's reaction to the news and its duration are more meaningful."
If the market is severely shaken by an incredible news, then short or consider buying promising tokens.
6. Golden Rule - Leverage Profitable Tokens, Quickly Sell Losing Tokens
Try to imagine a Ponzi scheme as a professional boxer: the winners get the prize money, the losers get nothing. Many people would rather sell the well-performing tokens than sell the losing tokens, and instead increase their investment, which is very undesirable.
GCR's Advice for Beginners
GCR's advice to young traders is to spend time in the market looking for all possible advantages.
"Even if you live another 80 years, you will never have such an easy opportunity to build generational wealth."
1. In the absence of valuation reasons, whole numbers are obvious convergence points for self-reflexive assets (i.e., either potential support or resistance points), and we need to respect Schelling points. 2022/3/23 (Telling you that on crypto charts, whole price levels often represent psychological areas for people.)
2. I've been telling people for the past few weeks that the biggest threat to any successful project is its own success. Because success can breed imitation, and this is a greedy industry, it will ruthlessly turn to original derivatives, chasing higher upside. 2022/4/8
3. Pairs Trading is an art that has been discarded in bull markets, but if you utilize this art well, you will win on both sides. 2022/9/12
4. Wealth is not wealth until it is realized, when trading volume > market cap, it usually indicates that the uptrend is in its final stage. 2023/1/27 (Telling you a timing to take profits.)
5. Many people's failures are because they did the exact opposite. Currently, I will continue to hold large spot BTC + ETH positions, because I believe the market bottomed out last November, and I am still optimistic about the future. 2023/2/5 (In the long run, the performance of long-term holders is much easier to outperform frequent traders.)
6. Those who chase two rabbits will not catch either one. 2023/3/18 (Telling you that you should only focus on one thing at a time.)
In 2024, GCR is Still the "Big Short"
4 months ago, GCR posted a series of the latest market views in a Telegram group, once again becoming the "Big Short".
On MEME
Someone asked GCR about his views on MEME COINS, GCR predicted that most coins will be slaughtered, the prices of the new generation of MEME COINS will be mainly supported by trading volume (the same players trading), on-chain liquidity is very low, which means that capitulation will be much faster than previous cycles.
The Solana ecosystem may be the first to collapse, followed by Ethereum. We have already seen the initial signs of weakness in "blue-chip" MEME (like WIF).
He said it is almost impossible to meaningfully short most of these coins, but he doesn't want to hold these coins when the first domino falls, the final round of on-chain hypergambling is about to end.
On Ethereum
A group member said: "The stock market is rising, and there are elections going on, so I decided to stay long."
GCR responded that updating beliefs is necessary for profitable trading in the market, Ethereum's L1 is being devoured by its own L2, SOL is being devoured by the dilution of MEME, through methods like http://pump.fun. There is almost no new Altcoin inflow, but thousands of new Altcoins are created every day.
However, the above is just GCR's personal view, the market is difficult to predict, DYOR.
