Most people who became wealthy through cryptocurrency happened to seize opportunities at critical moments.
Author: Puffy
Translation: Deep Tide TechFlow
Q: If the past were to repeat itself exactly, wouldn't it be too easy? How could everyone become wealthy so effortlessly?
A: Even if the past were to repeat itself (again) exactly, they wouldn't become wealthy so easily. It's much harder than it seems.
Independent Thinking
Less than 5% of people can truly think independently, and this ability often requires the following steps:
Establish a solid epistemological foundation
Gather original data
Apply meta-rules to narrow down strategy options
Clarify the relationships between things
These steps are very difficult for most people. They have never tried, don't know where to start, lack relevant experience, and have no confidence in making their views stand out amidst external noise.
Without this trait, you basically have no way to start in the cryptocurrency field. Even the simplest, most logically related datasets (like LTC charts—the first altcoin, and the "code" followed by all subsequent coins) may seem as complex as an unsolved mystery to you.
IQ and Relationship Handling Ability
Intelligence, in a sense, is a form of empathy. You need to grasp the intent of the questioner and understand the relationships they are trying to convey.
In the cryptocurrency market, the questioner is the entire market's participants. Those with high IQs can quickly identify relationships that others may never perceive.
For example, trying to explain the equation 3x = 6 to a dog is pointless because it cannot understand abstract concepts like "dividing both sides by 3."
Similarly, can you "see" the distribution of emotions, unrealized gains and losses, and the overall trend behind a chart just by observing it? If you can, you can infer the future direction of the market from it.
Powerful Strategic Thinking (Meta Game)
Many smart people can think independently and discover relationships, but their overall strategic thinking is often very weak.
Here are some typical failure cases:
Developers: Think their technical skills will give them a market advantage.
Thought leaders: Despite their high status, their past investment records are dismal.
Successful individuals: Can someone like Paul Graham really find the right investment answers?
The eliminated crowd: This happens to almost everyone, just like professional athletes eventually lose their peak performance.
Humans are inherently flawed and cannot fully understand and accurately model complex market systems. To avoid these traps, you need strong strategic thinking to help you filter information and allocate its importance.
Risks in Execution
Successful execution requires the following basic abilities:
Most people with startup capital are relatively stable in life and cannot easily invest funds into high-risk cryptocurrency trading.
If you have a happy family life and a respected career, the potential gains from participating in cryptocurrency trading may be far less than the potential risks.
There are many classic traps in trading that even those with advantages can fall into, such as:
Viewing profits as "casino money": Truly calm individuals will see buying SHIB with $300 and it rising to $30 million as the same as buying the same SHIB stack with $30 million of family wealth.
Taking action at critical moments: The market always repeats similar patterns. Many people know they are in a bad trade or position but hesitate to act. "Oh, it dropped 40%… Oh, it dropped 70%… Oh, it fell 65% from its historical high… Oh, it dropped 85%… What should I do?"
How to Avoid Bankruptcy Due to External Factors
Looking at the list of major Bitcoin holders, how many do you think still hold their Bitcoin?
Top 500 Bitcoin Holders: Top 50
980,000 coins*. Satoshi Nakamoto
400,000 coins*. HD Moore (AHA)
400,000 coins*. Dustin D. Trammell (AHA)
400,000 coins*. Tod Beardsley (AHA)
350,000 coins*. "Dread Pirate Roberts" aka "DPR"
300,000 coins. Roger Ver
300,000 coins*. "knightmb"
200,000 coins. Mark Karpeles
8.5 182,592 coins. "Loaded"
174,000 coins*. FBI (Federal Bureau of Investigation)
119,000 coins. 3 members of the AsicMiner management team (specific names unknown)
Common reasons for bankruptcy include:
Hacking attacks
Exchanges misappropriating user assets (countless similar cases)
Legal disputes
Tax issues
Why do almost every core figure in the cryptocurrency field eventually receive legal subpoenas, go missing under suspicious circumstances, or fall victim to scams or arrests?
In fact, preserving wealth is not an easy task. If you want to keep your Bitcoin forever, it seems that "dying early" is the safest way (this is sarcasm).
So how do people become wealthy through cryptocurrency?
Most people who became wealthy through cryptocurrency actually have a significant misunderstanding of the market, but they happened to seize opportunities at critical moments.
Many people invest in Bitcoin for reasons like "you can buy coffee with it" or "to combat inflation," or other popular sayings that come and go with each cycle, but these reasons have not materialized.
If you thought in 2010 or 2012 that Bitcoin was a novel proof-of-concept technology that accumulated real demand through dark web markets, proving its feasibility and gradually triggering a series of speculative bubbles, then your judgment was correct.
However, very few people held this view at the time.
Some people invested in ETH very early simply because their high school poker friends told them it could support decentralized games or other applications. Others believed ETH would become an unstoppable smart contract platform (until the ETC fork event occurred).
However, these ideas have hardly been realized. The vast majority of early "whales" either sold their assets at low prices or experienced a 95% reduction in their assets. This indicates a lack of deep understanding of how the market operates, let alone a clear investment strategy.
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