Author: Picolas Cage
Compiled by: TechFlow TechFlow
Original Title: The Era of Quick Riches Through Crypto is Over; Some Advice for Retail Investors During the Bear Market
Some thoughts on the market, and advice on how to profit from it/cope with it.
The market has changed significantly over the past two years, maturing and attracting more institutional funding and adoption.
1) As a small retail investor, you may not be able to make a life-changing fortune with Bitcoin. I think Bitcoin has little room for further aggressive price increases. It's already too large an asset class. I bought Bitcoin at $6,000 in 2018 and had the opportunity to earn a 20x return.
To get another 20 times return from now? That would mean Bitcoin would have to reach $1.8 million – which, in my opinion, would take well over 8 years.
I believe a more appropriate perspective for retail investors is to view Bitcoin as a store of value with sustained demand. The downside is that you can't simply buy the "safest" asset among cryptocurrencies (like Bitcoin, which is ranked number one) and expect to achieve life-changing returns with just a few thousand dollars.
The good news is that when I first entered the market, holding Bitcoin was pure torture. March 2020? A 40% drop in a single day. Imagine Bitcoin plummeting to $54,000 in a single day. This kind of extreme volatility makes it incredibly difficult to maintain sustained exposure to the crypto market.
Therefore, the good news is (and this might be a bit risky), the likelihood of Bitcoin experiencing that kind of drop in a single day is extremely small—it might take a week, but that gives you enough time to adjust and rethink your strategy.
2) As mentioned in point one, making money from cryptocurrencies has become more difficult, requiring you to extend your risk curve further. This means investing in Altcoin, or more recently, memecoins. Memecoins are the Altcoin of this cycle—the memecoin frenzy is what I call "altcoin season."
The problem is that memes, by definition, are not worthy of long-term trust or holding, so they completed their infamous "roller coaster" ride much faster.
The proliferation of meme culture, coupled with the reality that Bitcoin can no longer generate huge wealth, has fostered a prevalent short-sighted mentality among retail investors and young people.
I believe this short-sightedness is amplified by the "high-dopamine culture" among Generation Z and younger. TikTok, YouTube Shorts, Instagram Reels—plus modern games—all are about pursuing instant dopamine pleasure.
When this thrill-seeking mentality is applied to investing or trading, the result is that 99% of people will be "harvested" (suffer heavy losses) – and this has proven to be true, as meme coins have "harvested" most people.
Even popular cryptocurrencies like ETH (Ethereum) and SOL (Solana) have underperformed unless you can time the market perfectly to buy the dips at the bottom of the bear market. These factors have collectively fueled the popularity of the "get rich quick" mentality in the market.
3) The era of getting rich quickly is over, and it may not work now.
As I explained, there used to be opportunities to get rich quickly by trading mainstream cryptocurrencies (such as BTC or ETH), but with the entry of institutional investors, this possibility has largely disappeared. I have already outlined the pros and cons of this change, and what it inevitably leads to (short-termism, instant gratification, gambling-like investing, blind following, etc.).
So, what should we do now? As a bored "old uncle," I want to tell you that it's absolutely worthwhile to slowly get rich over the next 5-10 years.
For your reference, true wealth is not about owning more than $5 million in assets and living on a yacht; true wealth is not about being unable to escape so-called "government oppression," but about having more free time to pursue your interests and hobbies on earth, and being able to spend quality time with friends, partners, or children, instead of being suffocated by financial pressure—that is true wealth.
For example, having a small loan or mortgage—these things can genuinely improve your quality of life. Don't be swayed by the "Rolex and luxury sports car" nonsense—that's all designed to keep you poor and trapped in the system. If you believe that owning luxury cars, expensive watches, and material wealth is the key to happiness, then you're still trapped in the Matrix. (@Tatebrother)
That's enough talk. Here are some practical tips:
Laddering in: Yes, while Bitcoin's volatility has decreased, it still remains volatile. Be patient, pay attention to market sentiment, and wait for a market "blow" before buying in batches. I'm not suggesting you try to precisely buy the dips; that's too difficult and risky. I'm saying be patient, keep some cash on hand, and invest more as the price drops, using a tiered entry strategy.
Dollar-cost averaging (DCA):
Invest a fixed amount of money that you can afford each month, such as $250, to buy the equivalent of Bitcoin each month (it would be better to buy $62.50 per week).
This is a boring but effective strategy because you're essentially always buying at the lows. When Bitcoin's price rises, you don't even need to wait for an all-time high (ATH) to get a decent return. Moreover, as we discussed earlier, Bitcoin is almost certain to continue existing for the next decade, making it even easier to hold Bitcoin as an asset—that's what Cobie meant when he said "the easy way is $100,000 to $250,000."
Participate in Farm Airdrops:
Yes, airdrops have decreased in frequency, but they still happen occasionally. This is free money; remember to set aside some for taxes.
Learn about encryption and continue to research it:
Use your free time to learn about cryptocurrency and use that knowledge to build your account. Once your account has grown, look for InfoFi partnership opportunities (if they still exist) or collaborate with respected and trustworthy projects through KOLs. However, never promote worthless projects for quick profits; this is not only unethical but will also damage your personal brand in the long run. Remember, your friends are not your "bagholders."
Don't quit your job:
I cannot stress this enough. Investing is like a roller coaster—you can't get off halfway through the ride until the end. If your funds are invested in long-term, multi-year investments (like ETH or BTC), you can't just withdraw them because you need the money at the end.
Treat your invested money as if it has already "disappeared"—so only invest funds you can afford to lose. Don't overinvest, and don't invest or trade emotionally. Develop your investment rationale and cultivate a resilient mindset (avoid panic selling). Please don't do anything foolish, like building a 5-10 year investment plan around things like AIDogecoinNFTclubwifhat.
Save money and be frugal:
If you use your newly earned money to buy flashy things, then you are doing the following:
"We use things we don't need, and money we don't have, to please people we don't like."
"Oh, but I do have money." Believe me, bro, you don't. You'll need that money later. I'm 36, believe me, you'll need it. Life is expensive, really expensive—especially when you have a family to support.
Most young men buy luxury goods to please women or friends because they lack a sense of security, which is completely understandable. I've been through that age too; it's tough and not easy—but that's not an acceptable excuse.
The wisest thing I did when I was young to deal with this problem was to get strong and fit. I took advantage of my high testosterone levels at the time and focused on exercising. This made me feel confident, even superior, walking into any room because I was always strong and well-proportioned.
I don't need to wear an expensive watch to prove anything; my body does it all. I also don't need to wear luxury brand clothes. Even if you're wearing a $10,000 shirt, I'll still look better in a regular T-shirt because it fits my body and shows off my athletic physique.
In short, this is just my humble suggestion and personal opinion, and it's normal for some people to disagree. I've said enough, and we could have continued, but I'll stop here.
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