The life of a leek in a complete Bitcoin/blockchain economic cycle

Chapter 0 Introduction

At the end of 2013, Bitcoin had a huge bull market, attracting a lot of attention. At the beginning of 2014, Bitcoin was at the end of the bull market, showing signs of a bear market. As expected, a huge bear market came, which lasted until the end of 2015, when Bitcoin prices finally recovered. Then in 2016, the bull market began to wake up. Unexpectedly, in 2017, there was a crazy bull market, which has continued to this day.

I am Mr. S, a serial entrepreneur. I have experienced a complete economic cycle of Bitcoin, from the bull market to the bear market, and then to the bull market again. I am just waiting for the end of this bull market.

(Mr. S is a friend of the author of this article. Considering privacy, I use a pseudonym. For ease of reading, I write in the first person.)

Chapter 1 Can you make money by trading Bitcoin?

Anyone who has come into contact with Bitcoin basically enters the world by buying Bitcoin. Few people can avoid joining the game of buying and selling after entering this world, commonly known as "coin speculation". Can you make money by speculating in coins?

The answer is: Yes.

Is there anyone who makes a lot of money?

Yes, but I don't know many.

Is there anyone who lost money?

Yes, I know a lot of them. I even know people who lost everything they had.

Always remember that the idea of ​​getting rich from cryptocurrency trading is often a false impression, and more of a survivor bias. Because only those who have made money will stand up and brag, while those who have lost money are embarrassed.

I started to trade Bitcoin when it reached its peak in 2013. Without a doubt, I was going to get stuck.

Fortunately, I have never had the habit of all-in, and I am not the kind of serial entrepreneur who starts and fails repeatedly. Although I bought at a high point, I still have enough funds to lower the cost during the decline.

In the bear market of 2014, I did not give up and kept adding to my positions.

I can't tell you how much money I lost, because I don't want to tell you. But I want to tell you that it's exhausting to trade in cryptocurrencies. Not only is my body tired, but my heart is tired, and my wallet is exhausted. Bitcoin is traded 24/7, with ups and downs. I have a heavy position, so the psychological pressure when operating is particularly great.

For those who are entering the cryptocurrency market during this bull market, I just want to say to you: be cautious.

Chapter 2 Never Trade Bitcoin Futures

I just don’t feel satisfied with spot trading - the losses are not painful enough. I don’t know if my brain was stuck in the door or flooded, but I fell into the pit of futures trading.

2015 was the year of futures trading in China’s exchanges. Various futures trading methods began to mature. I had a few books on K-line trading, from entry to abandonment, and before I finished reading them, I picked up the keyboard and sent money to the exchange. As a result, I lost a lot of money.

There was no thrilling climax in this process, only the sad Pacific Ocean that made people feel hopeless.

The futures market itself is a negative-sum game. The exchange has to take a cut, so you have to beat more than 51% of your opponents to make money. Unfortunately, I am an "entrepreneur" by birth, but I think I am more professional than those professional stock traders. It would be strange if I didn't lose.

I am a person who is good at summarizing. After a large order was blown up, I decided to quit the arena and invest in a cryptocurrency fund. Let those experts help me harvest the leeks. Haha. Anyway, I lost everything.

At this point, I decided to really withdraw from the futures market. Because I finally figured out one thing: Bitcoin futures have an ultimate boss - the currency exchange platform. If the platform is your opponent, then you will definitely die without a burial place.

Just think about it and you will understand. For the exchange, all players on the platform are transparent. It is the same as when you play poker with others and your opponent can see your cards. What is even more terrifying is that if the platform participates, it can provide unlimited bullets. This area is completely unregulated, and the exchange has the opportunity to cheat seamlessly at zero cost.

The platform may not actually participate, but if it does, other players will definitely lose. But how do we know whether they will actually participate?

Chapter 3 Can you make money by doing Bitcoin projects?

After losing money during the transaction, I began to reflect on my mistakes.

I have always considered myself an entrepreneur, and I have made a few successful small game products in the gaming industry. Since I have not been successful in cryptocurrency trading, I guess it is because I do not have the talent for finance. But I do have the talent for entrepreneurship. I will work on the Bitcoin project, and I don’t believe that I will not be able to make money.

Considering the characteristics of my own profession, I decided not to do it myself. Instead, I participated in the crowdfunding mining. I won’t go into the details of the process, it’s a sad story anyway.

Almost everyone made money from mining at the time, but our project lost money, which was extremely unlucky.

There are several key control points in mining. One is the purchase cost; the other is the operating cost; the other is the system risk, which is the price of Bitcoin and the difficulty of mining. The latter factor is uncontrollable. But the first two factors are controllable by the project. However, the final failure of the project is that the crowdfunding mining leads to not spending money carefully.

Strictly speaking, all Bitcoin fundraising projects are a form of financial management. As a deflationary currency, Bitcoin is much more difficult to earn interest through financial management than fiat currency, which is an inflationary currency. In this new field, those who try to conduct business through fundraising and financial management are definitely not experts in the fiat currency world, otherwise they would not have to take risks in this field.

It is better to take it easy. Defaulting to not trusting experts and masters in this field may be an effective strategy to survive longer here.

Chapter 4 I lost a lot, but I was lucky

Don’t be sad after seeing so much negative energy. Let me tell you something positive.

I lost a lot of money, but fortunately I studied Bitcoin seriously, including its technical principles and economic logic. Losing money didn't make me completely abandon Bitcoin, which made me luckier than most leeks. I still have a lot of Bitcoin, even though I lost a lot. Just think of me as a rich guy.

Losing money in a bear market and shrinking assets are indeed very sad. But it also allows you to buy a lot of coins with very little money. So I, a small rich man, didn’t spend much money to buy a lot of coins. I’m not rich, I’m poor. I just have a good eye (snicker, snicker)

But what really made me rich was BitShares.

I spent 25,000 yuan to buy the bottom of BitShares when it dropped to 2 cents. For two years, BitShares was like dead, lying on the ground without moving, but I didn't expect that I sold it last week and made more than 100 times the profit. 25,000 turned into 3 million.

All transactions are a labor of measuring risk. Who knows that the ability to take risks is not measured by your professional knowledge, but by the size of your bet. I believe that a professional copycat who has worked at Dazhihui for ten years will not have the experience of turning 25,000 into 3 million like me. I have only operated twice, one to buy and one to sell. Damn it, my coins have not even been sold to the exchange, and I am waiting to die in it.

When my bets were so low as to represent a small portion of my assets, they became my greatest gains.

I am not saying that my experience can be learned and replicated, I just want to say that I have traded so many coins and worked on so many projects, but the ending is so dramatic. The bigger the bet, the greater the psychological pressure, the more tormenting it is, and the ending is not good at all. But with a small bet, I have safely passed a bear market and ushered in a super bull market.

If you read my story, please don't think I am showing off my wealth. I just want to tell you a truth, try to keep your bets within a range that allows you to maintain a balanced mentality. Never go all-in.

Chapter 5 Buy coins in a bear market and build projects in a bull market

After going through a complete economic cycle of the Bitcoin/blockchain industry, I understand one thing: buy coins in a bear market and focus on projects in a bull market.

In a bear market, the cost of buying coins will be very low. The entire industry is unpopular, so it’s really hard to work on a project. You have to be a rare talent to make a profit in a dull industry.

In a bull market, chasing the ups and downs will only make you lose your underwear. I use ten pairs of underwear to assure you that what I said is true. But in a bull market, people are extremely popular, and no matter what you do, people will rush to give you business.

So now I am researching blockchain-related entrepreneurial projects, and also pretending to make some small investments, and investing in good ICO projects when I see them.

I invested in a few ICOs this year, and they increased several times, but I didn't get rich because I bet too little. I was just learning. I have a project I'm working on, and I'm planning an ICO. I hope my wealth will reach a new peak after the success of this project. I also hope to make a small fortune for those who trust me.

Chapter 6 Conclusion

Life never stops, and struggle never ceases. I wish all new and old investors a happy bull market, and a happy journey through the bull and bear markets.

(Postscript, dear readers, if you have an interesting story you want to share with me, I would be happy to write it up as an article. Add my WeChat ID: 13116885)
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