2021 Mining Circle - Why should newcomers experience mining first?

It has been nearly a year since I purchased computing power to mine Bitcoin at the beginning of this year. As the end of the year approaches, it is still necessary to share my mining experience. This time I will mainly talk about newcomers entering the mining circle.

As expected by everyone, 2021 may be a big bull market, which also proves the saying that there is a bull market every four years. Every bull market will bring in many new investors. Looking back, the first time I heard about cryptocurrency and registered a blockchain wallet was in early 2014, which was just at the end of the bull market, but I didn’t pay attention to it because of the bear market. The second time I officially participated in cryptocurrency investment was in mid-2016, which was the early stage of the second bull market. I saw a lot of low-priced coins, but I didn’t buy them until 2017.

I started by buying a lot of altcoins, because altcoins had a larger increase. Later, due to policy reasons, altcoins and Bitcoin rotated, and then I realized the power of Bitcoin's rise. After the last round of 94, I had a lot of zero-coins in my hands, but Bitcoin took advantage of that opportunity to continue to rise, which was also beyond my expectations.

When I first started investing in the cryptocurrency industry, I couldn’t really call it investing, I could only call it speculation. I bought whatever was rising the most, but I ended up losing money. Fortunately, as long as you study everything carefully, you can see the clues and finally get back on track. Before you learn to walk, you must fall a few times.

Cryptocurrency is divided into two strategies: investment and trading. As for trading, most people must first learn to do long-term trading, then learn to do swing trading, and finally learn to do short-term trading. Of course, if you are good at swing trading or long-term trading, there is no need to do short-term trading.

Essentially, it is because long-term investment is relatively simple. You can just hold on to it or make continuous investments without having to judge market trends.

Then, you can do swing trading. If you have high trading skills and are confident about the market, you can do swing trading relatively well. However, this part requires certain technical abilities, which means you have to practice continuously. It is difficult for ordinary people to learn it.

The most difficult thing is short-term trading. Short-term trading contains a speculative element to a certain extent. If you don't grasp it well, you will lose money. Therefore, short-term traders basically have a strong desire to restrain themselves. They should buy when they should buy, even if they have to chase high prices. They should sell when they should sell, even if they have to lose a lot of money. At this time, it is basically more difficult for ordinary people.

Similarly, for cryptocurrency investment, there also needs to be a certain process, where you first have to experience mining, then hold Bitcoin and mainstream currencies, and finally experience investing in altcoins. Similarly, if you are good at Bitcoin and mainstream currencies, there is no need to participate in altcoin speculation.

Why is mining ranked first in cryptocurrency investment? In fact, the reason is not difficult to understand. Mining is actually a test of a person's mentality towards cryptocurrency investment, rather than really relying on mining to make a fortune.

Simply put, mining is a long process. What needs to be done in this process is to train your mentality, not panicking or getting confused, but taking things easy. In this case, the mining industry is the easiest to achieve. Developing this mentality will not only help you make money in the mining industry, but will also greatly improve your daily life, work, and interpersonal relationships.

Let’s take the digital currency mining this year as an example. At the beginning of the year, the coin price continued to fall, which hit the mining industry. Many people may not have persisted. Later, due to the coin price factor, mining basically could not keep up with the coin price in the middle of the year. Because of the big drop on March 12, coupled with the subsequent halving, the author clearly remembers that the daily net income of 50W/T computing power was less than 1 yuan/10T at the lowest. The computing power price was also relatively low at that time. That time was actually the most unbearable time of the year. Bitmain’s new mining machine came out, and the computing power pressure increased instantly. At this time, it was basically difficult to sit still.

Fortunately, after experiencing the difficult period in the middle of this year, I was eager to get my money back, so I had to hold on to the mined bitcoins. Why? In fact, the mining process is the process of cultivating bitcoins to hold on to, because if the net return rate is less than one dollar a day, it will take at least five years for me to get my money back, so I have to hope that the price of the currency will rise.

Not only do I hope that the price of the currency will rise, but other miners do too. Miners are the ones who can persevere the most, and it is precisely because of this that they are now entering a harvest period.

Only after experiencing mining can you deepen your impression that the return on investment from mining is mostly due to the rise in coin prices and continuous persistence in time. This is the essence of profit, and it is also a way to deepen character development.

For those who have experienced mining, only in this way can they cherish every opportunity of low-priced coins in the market, buy Bitcoin and hold it, and then not sell it. Because of this, after mining, you can invest in Bitcoin and mainstream coins yourself.

After all, mining is not as efficient as buying coins, except in the early stage of a bear market. In the early stage of a bear market, the price of mining machines is not high, the price of coins is not high, and the market will continue to bear for four years. Therefore, buying coins will not be profitable in the medium term. This is the best time to enter mining, and the end of the bear market is the best time to buy coins. Other times are secondary events, that is, mining is possible, but the profit will be less, or it will be more tiring.

After becoming familiar with investing in mainstream currencies and Bitcoin, the next step for novices is altcoins. Altcoins have only one characteristic: high risk and high return. Some can return to zero, making your property vanish in an instant, while others can soar to the sky, making you instantly rich. From a probability perspective, every coin has a possibility. Every day, there will be news of various currency prices rising and falling in the market, which can easily confuse novices and lead them to buy altcoins, only to end up losing a lot of money. This is the lesson.

So what kind of people are suitable for investing in altcoins? Naturally, only those who have been in the cryptocurrency circle for a long time, have seen the world, and have experienced all kinds of routines are qualified to invest in altcoins, find potential coins from a bunch of altcoins, and finally make a profit at the right time.

Finally, God is fair. You don’t have to worry about too many things when mining, and you can make a profit with a high probability. You can do it without any basic knowledge, so it is the best way to exercise patience. Investing in Bitcoin and mainstream coins requires certain skills, but the rewards are considerable compared to mining. Finally, investing in altcoins has the highest requirements and requires a sharp eye to dig out treasures from a pile of garbage. This is naturally difficult for many people to do. Naturally, if you succeed, you will make a lot of profit.

Having said that, the 80/20 rule is still very effective in the cryptocurrency world, so investing in copycats is actually a high-risk approach. Only after mining step by step online can the mainstream truly experience the elements of making money in the cryptocurrency world.