Opportunities in the cryptocurrency industry

There is always a new way to make money/capture alpha so no need to fomo one if you missed it, move on to next, keep searching, stay open.

I was deeply moved when I saw this sentence. Combining my own gains and losses in the cryptocurrency industry over the years, I think it may be more comprehensive to understand this sentence from two aspects.

First of all, we must choose a sunrise industry that suits us based on our actual situation.

Only sunrise industries mean that new opportunities can continue to emerge, and we don’t have to worry about missing out on previous opportunities and never having future opportunities.

The cryptocurrency industry has been around since Bitcoin was launched in 2009. Although it is not as old as many old industries, it has developed into several sub-fields. These sub-fields have gradually differentiated after different periods of development. In my opinion, some of them are already "sunset" industries, while others are still "sunrise" industries.

For example, mining and centralized exchanges are clearly “sunset” industries. Without sufficient funds and a strong enough operation team, it is difficult to even enter their threshold. Even if you enter, it is difficult to maintain it for a long time.

If an ordinary entrepreneur chooses to start a business in these two fields now, I think it is almost impossible to have new opportunities, so the probability of failure is quite high. If an ordinary investor wants to invest in these two industries, he may only get the average profit of the industry, but not excess profit.

But at the same time, the gaming and NFT fields are still in a relatively early stage of development, so there will still be many opportunities to start a business in these emerging fields. Similarly, investing in these fields is also likely to generate excess returns.

If we look beyond the cryptocurrency industry, we will find that many fields are considered promising industries by the general public, such as new energy, artificial intelligence, electric vehicles, etc. However, for ordinary people like us, do those so-called promising industries have anything to do with us? In my opinion, they have very little to do with us.

Because for ordinary people who have no money, no connections, no resources, and no professional knowledge, even if we enter these industries, we will probably only do the lowest-end jobs. Therefore, these so-called sunrise industries are meaningless to us who hope to get excess returns.

Secondly, since we have chosen a sunrise industry, the subtext means that we are still in a very early stage and there will be a lot of new opportunities in the future.

From the rise of DeFi in the summer of 2020 to the NFT bull market in 2021, we will find a very interesting phenomenon: the newcomers in each field have almost no background, almost all new faces, and do not overlap with each other. For example, AC, the founder of YFI, seized the opportunity of DeFi, but it seems to be limited to DeFi; the advantages of the founding team of CryptoPunk (Larva Labs) seem to be limited to NFT and have not spread to DeFi. Similarly, the founding team of Boring Ape seems to be only popular in the NFT field.

If we continue to look back, we will find more and more such cases: for example, the excellent team working on the public chain and the excellent team working on the second-layer expansion are completely different people, and the excellent team working on the exchange and the excellent team working on the mining machine are completely different people.

Therefore, I fully believe that new teams and new faces will emerge in new sub-sectors in the future, and among them are each of us who is working silently in this industry.

This is true for entrepreneurship and even more so for investment. In the public chain field, there are 100-fold coins such as Bitcoin and Ethereum. Didn’t catch it? No problem, there are Dogecoin and Shitcoin. Still didn’t catch it? There is YFI in the DeFi field, and CryptoPunk and Boring Ape in the NFT field.

Such examples have emerged in the past, and I believe they will continue to emerge in the future.

So as long as we are in this industry, whether it is starting a business or investing, we don’t have to regret too much about our past mistakes. Just like what the above sentence says, "keep moving forward, keep exploring, and keep an open mind", we will definitely find our own opportunities.