This article is from: Taiki Maeda

Translation｜Odaily Planet Daily (@OdailyChina); Translator｜Azuma (@azuma_eth)

In the crypto market, almost everyone knows Eugene Ng Ah Sio (0xENAS), whose real identity is Darryl Wang, co-founder of Tangent Ventures.

For a long time, Darryl shared his personal trading insights and operation reviews through the once-anonymous account Eugene, providing various valuable market opportunity analyses.

Darryl is one of the best cryptocurrency traders in the world, but his growth journey has not been smooth.

After nearly facing liquidation in May 2021, Darryl continuously evolved as an investor and successfully established a well-known fund in the industry.

Since 2022, I have had several conversations with Darryl on my YouTube channel, and I will transcribe the content that has influenced me the most.

Considering that Darryl is one of the sharpest minds in this market, I hope this content can also help you.

Q1: Personal Background

• Host (Taiki Maeda): To help everyone understand you better, can you share what you are currently doing?

Eugene: I am the co-founder of Tangent Ventures, which is a multi-strategy proprietary investment firm. I focus on liquidity markets, while my partner Jason is responsible for the venture capital market. We also co-manage a research-oriented spot investment portfolio, focusing on long-term fundamental strategies.

Before this, I was one of the heads of Defiance Capital.

I initially entered the cryptocurrency market as a retail investor in 2020, but I have grown a lot since then.

Q2: Lessons Learned

• Host: You are now a very successful trader, but I remember you faced some setbacks in 2021. Can you share your mistakes and the lessons you learned from them?

Eugene: In early 2021, I adopted a high-risk strategy and aggressively leveraged my positions. I briefly made a profit in February, but when I reinvested in March, I failed to avoid the crash in May. I was over-leveraged, and when the market dropped, I added more leverage, suffering an 80% drawdown at the worst point and was forced to close my core positions at the lows.

That was a brutal experience, but it taught me the most important lesson — survival first. After that, I chose to cut my losses and start over.

Another significant mistake I made was concentrating my positions too heavily in a single DeFi protocol, which has never recovered since its decline. That loss made me realize that no matter how strong your conviction is, diversification is necessary.

The most important thing is to always stay in the game. Don’t let any single trade completely knock you out. Adaptability, risk management, and learning from mistakes are key to long-term success. Even today, as we adjust our bet sizes, minimizing bankruptcy risk is our top priority.

Q3: Evolution of Trading Style

• Host: How has your trading style evolved?

Eugene: The first step is to identify core strategies — looking for asymmetric opportunities with significant potential returns. The challenge lies in identifying them in real-time; I don’t have a magic ball that reveals everything, and all decisions come from experience, trial and error, and intuition development.

For me, cryptocurrency is still very intuitive. When I see new opportunities, I usually have an intuitive reaction within minutes, and over time, I’ve found that my first instinct is often correct.

Looking back, I’ve tried to analyze what triggers that intuition — what specific factors give me confidence in an investment… the answer is “patterns often repeat”; despite the market constantly evolving, the biggest winners often share similar characteristics.

Over time, we have built a proprietary framework at Tangent to visualize and quantify these characteristics, helping us better identify them. These frameworks have greatly improved accuracy and allowed others in the company to leverage my market experience.

Q4: Trading Psychology

• Host: How do you cope with the psychological challenges of trading?

Eugene: Yes, this is a huge challenge.

In a 24/7 market like cryptocurrency, you need to constantly battle emotions of greed, fear, and the worry that someone will sell off.

It’s crucial to keep a clear head; if I feel emotionally unbalanced, I will pause my trading. Sometimes, I will completely step away from cryptocurrency for two to three days to reset.

One key lesson I’ve learned is “you can’t catch every opportunity”; you must accept the fact that you will miss some opportunities. I stick to my area of expertise, recognizing my strengths and ignoring distractions is vital for long-term success. As GCR once said: “He who chases two rabbits catches neither.”

Q5: Position Structure

• Host: What kind of betting structure do you generally adopt?

Eugene: I believe in the power of concentrated positions. Sometimes, the top three holdings in our portfolio can account for 80%, focusing on aligning your portfolio with your most confident bets.

Of course, this also means you need strict risk management to avoid significant drawdowns.

Q6: Risk Balancing

• Host: How do you find a balance between avoiding risk and achieving massive returns?

Eugene: This is a dilemma. In the last cycle, I took on significant risks — for example, putting 80% of my net worth into a single asset — which sounds absurd in hindsight, but that boldness also brought huge returns.

As an investor in the new cycle, I am now more cautious, but I still ask myself: what allowed me to make those big moves before, and how can I replicate that without being reckless now?

The challenge is to maintain the previous conviction while taking risks, all while keeping a realistic attitude towards market volatility.

Q7: Daring to Dream

• Host: I remember you put 80% of your net worth into AVAX in 2021. Looking back, if you had the chance, would you make the same decision again?

Eugene: It’s hard to say; it seems absurd now, but that level of risk exposure allowed me to compound significantly. As I matured, I gained a higher awareness of risk and developed a completely different system and framework to prevent me from making big mistakes. I was more naive back then, and I believe that mindset played a significant role in my success in the last cycle.

It’s important to be aware of risk, but it’s also crucial to dare to dream when the market presents opportunities.

• Host: So, you mean your approach is now more cautious, but you still need to be able to take on the same risks to achieve outsized returns?

Eugene: Exactly. Even if it sounds daunting, making big and concentrated bets is essential. It’s difficult to execute, but that’s the way to achieve the best returns. You must be willing to take those risks, even if they make you uncomfortable.

Q8: Recent Mistakes

• Host: It sounds like you have established strong discipline. Can you share a bad trade you made and what you learned from it?

Eugene: I’m just an ordinary person and often make mistakes.

A recent mistake that left a deep impression on me was over-leveraging SOL at $210 and not adhering to a stop loss at $200.

The most important lesson in trading is to control downside risk, and to do that, you must execute stop losses. Once you become lax in this area, mistakes can accumulate dangerously, and your risk can far exceed your initial plan.

Q9: Don’t Fall in Love with Positions

• Host: What would you like to say to your former self?

Eugene: I would ask myself, “If you sold your entire portfolio today, would you buy back the same assets in the same proportions?” Most people would realize they wouldn’t, but they continue to hold bad positions due to emotional attachment.

Additionally, opportunity cost is important — investing every dollar in one asset means it cannot be reinvested elsewhere.

Another thing is to avoid the mindset of “making it all back in one trade.” This is a common trap. Don’t engage in revenge trading; instead, focus on accumulating small victories.

Q10: When to Cut Losses?

• Host: How do you know when to cut losses on a position?

Eugene: This is difficult. Many people hold onto losing positions due to emotional attachment or hope for a turnaround. But the key is to be honest with yourself. If you reassess your thesis and the situation hasn’t improved, then it’s time to move on.

This is where many retail investors struggle the most.

Q11: Avoiding Bias, Trusting the Team

• Host: How do you ensure that bias does not affect your judgment?

Eugene: Team collaboration helps mitigate this issue. In our company, we keep everything transparent, so when I do something questionable, people can point it out.

Accountability keeps me restrained. We conduct rigorous and even brutal post-mortems on every major decision, and we encourage everyone, including new employees, to point out more “senior” members in a brutally transparent manner. There is no room for arrogance in the market; it’s crucial to build a team committed to extreme honesty without emotional interference.

If you are solo, find someone to share your positions with and get feedback. This helps alleviate emotional decision-making.

• Host: So, accountability plays a huge role in keeping you focused?

Eugene: Yes. You need to have a team or even a trusted person to discuss trades with, ensuring you don’t lose control when you make mistakes. If you make a mistake, it’s important to accept it, move on, and not dig yourself deeper.

This sense of accountability prevents you from making more mistakes.

• Host: Can you share an example of how this has helped you avoid mistakes?

Eugene: I once built a large short position on DOGE, thinking a certain market event would trigger a sell-off. One of my team members questioned my thesis, and instead of doubling down, I paused to reflect and realized that the position was not solid. This transparency and honest feedback allowed me to cut losses early and reassess.

If I had been operating alone, I might have stuck with that position and watched the losses grow.

Q12: Social Media Choices

• Host: For those looking for their community or trustworthy friends, what do you suggest they do?

Eugene: Many alpha opportunities have shifted from Twitter/X to Telegram and Discord communities.

Twitter/X is a great platform, but I now prefer Telegram channels as my primary communication medium.

Q13: Trader Qualities

• Host: What common traits do successful traders share?

Eugene: Successful traders excel at handling pressure. When the market is volatile, they can make decisions calmly. If you have this ability, hone it; if not, recognize it and don’t force yourself into high-pressure situations.

It’s crucial to recognize your strengths and weaknesses and choose your opportunities accordingly.

Q14: Common Mistakes Traders Make

• Host: What are the most common mistakes traders make?

Eugene: I often see people counting their chickens before they hatch.

This happens when people get caught up in the idea of “I’ve made it” due to portfolio growth and start making significant lifestyle changes. They think the money on paper is real cash, so they buy unnecessary things like expensive cars or luxury watches, but the reality is that until the money is in your bank account and taxes are paid, it’s just points on a scoreboard.

I always view cryptocurrency as a game — it’s not real money until it turns into cash. People often mismanage their wealth and lifestyle when they don’t understand this.

Q15: Operational Misconceptions

• Host: What are some common misconceptions people have about cryptocurrency?

Eugene: One of the biggest misconceptions is that you should allocate funds based on fundamentals. People think that if a project has strong fundamentals, the price will rise accordingly, but in reality, the market doesn’t care about fundamentals 90% of the time.

The real way to make money is to predict which narratives will become popular before others do. At least that’s my experience. It’s a bit like knowing something will happen and trying to grab it as quickly as possible because the market can change faster and further than expected.

Q16: Advice for Newcomers

• Host: What advice would you give to someone just entering the cryptocurrency market?

Eugene: Honestly, if I were entering the cryptocurrency market today, I would question whether it’s worth it.

But if you still want to get in, I would first recommend focusing on on-chain assets. They are the assets with the best upside potential, allowing small portfolios to compound quickly, but the on-chain market won’t last forever — on-chain assets have specific cycles, and when they dry up, you also need to be able to trade on CEX.

Mastering both aspects of trading is key, but I would focus on mastering one and being proficient in the other, rather than trying to master both at the same time.

Q17: Personal Dreams

• Host: You’ve been in the cryptocurrency space for a while. What are your personal goals for the next 10 years? Do you see cryptocurrency as just a means to an end?

Eugene: First of all, I absolutely love this market. Competing with the best traders and investors in the world is one of the main reasons I entered this space. In the next 10 years, my goal is to build the best proprietary fund in the cryptocurrency field.

In the long term, I’m looking to the stars. I’ve always dreamed of contributing to humanity’s progress as an interstellar species. This largely means supporting space exploration in any way I can. One of my bucket list items is to go to space before I die.

• Host: That’s incredible. So, you believe cryptocurrency is not just about wealth accumulation — it’s also part of a grander vision?

Eugene: Exactly. There has been a lot of discussion about the mission of cryptocurrency, and I don’t need to repeat it here.

For me, beyond that, cryptocurrency is also a platform for achieving extraordinary wealth, giving us the opportunity to compete on a global scale. I want to leverage that success to support larger causes, such as biomedical research, space exploration, and environmental protection.

We have actually invested in robotics, biocomputing, home cancer detection, and other cutting-edge technologies unrelated to cryptocurrency. Sometimes, the founders are even former cryptocurrency practitioners or people interested in cryptocurrency. Everything is interconnected.

Q18: Final Advice for Readers

Host: Finally, do you have any advice for the readers?

Eugene: One thing I want to say is to give back. If you’ve achieved success, remember that someone paved the way for you. Expressing gratitude and sharing your knowledge with others is one of the most meaningful things in this field.

From a trading perspective, don’t become too attached to your positions. The market will always surprise you. When you’re wrong, you should cut losses quickly and humbly admit your mistakes. Most importantly, view unrealized gains as points on a scoreboard — until the money is in your bank account, it’s not real cash. If you remember this, you will avoid some of the biggest traps in this field.

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