My opinion on the Bitcoin survival guide

Chapter 0 Introduction

I haven't found any good topic this week. Damn it. I can usually come up with a topic before Wednesday, but not this week. I heard that Professor Li Xiaolai is going to give a course on Bitcoin survival guide, so I'll write down my views.

I don’t know what the perspective of Mr. Li’s survival guide is. This article defines Bitcoin as a way to make a profit. I hope to write a guide on how to make the profit you want. I will write a few points that I think most people should pay attention to. It may not be correct. It is for reference only. Please think independently.

Chapter 1 Positioning

If you plan to get involved in the world of Bitcoin, it is best to determine the intersection between yourself and Bitcoin. Here I will only position it from the expected value of gaining profit. You can consider the following positioning methods.

1. Your goal is to reach the stars and the sea. That is, you hope to hold Bitcoin to the level of "hundreds of thousands of dollars".

2. Your goal is to make a big profit, such as doubling your investment income. This is often the case when you want to buy an iPhone 6 or a BMW.

3. Your goal is to outperform inflation and other goals. You only regard Bitcoin as a capital allocation in financial management.

Of course, positioning is not something you can figure out all at once, or something that is set in stone for life. You often need to review your positioning regularly and modify your goals based on your own situation at the time.

After positioning yourself, it is best to do an asset analysis. If you have the habit of organizing a balance sheet, that would be great. If not, just search for one on Bing, or find an accounting book and copy it, and write a balance sheet right away. This will help you figure out how much money you actually have. Believe me, it is extremely important, really damn important, and the time and effort you put in can be ignored. As long as you have a high school degree or above, you can definitely figure it out in one morning.

Chapter 2 Positions

Since Bitcoin is defined as an investment method, the position should be a priority.

If you are targeting the stars and the sea, it means that you will hold Bitcoin until the price reaches the stars and the sea, or in other words, reaches "100,000 dollars".

For most people, for most people, for most people:

The best way is to control the position within 10%. The reason is very simple, because we can often ignore the 10% loss of our income. For example, the country sets the personal income tax rate at 10% for the same reason. 10%, no one cares. If I take a little, you won't start a revolution.

According to your balance sheet, set aside 10% of your assets, or even safer, set aside 10% of your liquid funds, and use them to buy Bitcoin. Then leave the Bitcoin world completely. That way, you don’t have to worry about the rise and fall of Bitcoin, and whether you can achieve your profit target. Time will give you the answer. If you achieve it, people all over the world will talk about Bitcoin, just like the Internet now. If you don’t achieve it, it means that the Bitcoin experiment has failed, and you have forgotten the 10% of funds that year.

If you audit your balance sheet and find that you are really poor, or even have negative assets. The amount of Bitcoin that can be bought with 10% of your assets is really pitiful, so little that you may not remember it at all in a few years. Then my suggestion is to add a liability line to your balance sheet, borrow a few thousand yuan at the current price, and buy 1 to 2 BTC. Then leave the Bitcoin world completely. If it is less than 1 BTC, even after several years, when the whole world is talking about Bitcoin, you may have forgotten that you have ever bought Bitcoin. Because when you buy it, you will not care much, and after buying it, you will eat less meals.

For most people, it is strongly recommended not to exceed 10% of the position.

If your goal is to make a big profit, such as doubling your investment. This goal is still easy to achieve given the current price of Bitcoin. You just need to control your position. Even if the price drops by 90%, you will only cry for a day. After a week, you will accept it calmly and will not close your position. I think it is okay to control your position to 20%.

Check your balance sheet, set aside 20% of your assets to buy Bitcoin, and then periodically pay attention to the price of Bitcoin. Don't cry if it falls, and don't be happy if it rises, because you only have a 20% position. When the price doubles, sell it without hesitation and leave the market. Remember not to enter again, remember. Otherwise, you will know what a dream is.

If your goal is to outperform inflation, I strongly recommend regular investment, and keep the fixed investment assets within 10% of your monthly income. Set aside 10% of your salary every month to buy Bitcoin, regardless of price fluctuations, just buy at the market price. Buy and leave.

If you can control your position, I sincerely suggest that you stay away from all kinds of information about Bitcoin and delete the price software. Instead of wasting your time, you might as well do something you are good at.

Keeping your position within a level where you can accept losses is the most critical factor in how long you can survive in the Bitcoin world. Having strong self-control is extremely important. If you can successfully control your position, you don’t need to read the rest.

Of course, there are some people who will go all out no matter what, just like me, an idiot. In this way, if you want to survive longer in Bitcoin, you need to do more.

Chapter 3 Learning

When I was writing the outline, I listed learning in the first chapter. But after finishing the chapter on “Positions”, I found that learning is not the initial condition for getting in touch with Bitcoin. In fact, people who don’t learn, as long as they control their positions as mentioned above, may be the ones who survive the longest in the Bitcoin world.

Of course, it is necessary to learn how to store private keys. Even if you have enough self-control to control your positions, you still have to learn how to store private keys. At least find someone you trust to teach you step by step.

If your position exceeds the point where you can ignore it, then you need more reasons to support your beliefs. This is to learn more knowledge.

Whether you want to bet on the stars or outperform inflation, as long as your position is too high, you must quickly learn the principles of Bitcoin, and you need to understand it as soon as possible. If you don’t even know the basic concepts of blockchain, timestamp, proof of work, public-private key pairs, etc., you will not survive in Bitcoin for more than one season, and you will be finished after a few episodes. We generally call a 50% increase or decrease in the price of Bitcoin a season. If you don’t understand these basic knowledge, you will be scared to death if the price is cut in half.

If you are a user of Xingchen Dahai, in addition to the basic knowledge of Bitcoin, you also need to master economics. There is no way, without a basic understanding of economics, it is difficult for you to believe in Bitcoin, which is not backed by the government, and how can it have credibility. At least you have to understand Hayek's theory. Fortunately, there are many second-hand books of Hayek now. If you are not engaged in academic research, it is not shameful to read second-hand books.

Of course, if you are a user who has doubled your profits, you don’t need to learn so deeply. Just spend more time enjoying life and forget the pain of falling prices.

If you are a user who wants to outperform inflation, I'm sorry, but you need to learn economics. Otherwise, in your eyes, Bitcoin will be even less reliable than legal currency.

In addition, as a user who is very interested in cryptography and computer science, it is also my duty to learn cryptography and computer science. This is not difficult. There are many forums that introduce this aspect. It is good to be able to appreciate the power of cryptography and give you strong confidence. Being able to understand pseudocode is considered to be a pass in computer science (for someone like me, I can only read pseudocode and then exclaim, "Ah, so awesome, so awesome...").

Learning the basic theory of Bitcoin, economics, cryptography and computer science is not difficult in the current era of information explosion. As long as you master the basic logic and scientific literacy (sorry, these two things are actually difficult to master), spend about an hour every day reading posts, and you will soon be able to live comfortably in the Bitcoin world.

Chapter 4 Cryptocurrency Trading

After position control and learning, most people are basically full of confidence in Bitcoin. But human greed and things that satisfy human greed will always be around you.

When you hold Bitcoin and regard it as currency, and see that your RMB will earn interest if you put it in a bank or Yu'e Bao, you will definitely be tempted to think, damn, can my Bitcoin earn some interest?

As a result, the market also provides a large number of financial management, cryptocurrency speculation, and futures...

For most people who enter the world of Bitcoin, seeing the price of the currency go up and down, they will have the idea of ​​making a swing trade. If they succeed in making a profit, the probability of being exposed to leverage and futures is quite high. It is actually quite difficult to control your desires to the extreme and stay away from currency speculation completely (this is how I came here, and I successfully lost money).

I think the best advice is: don’t speculate in cryptocurrencies and stay away from futures.

But I sincerely think that a more practical suggestion is to reduce the number of operations.

If you must do it, here are a few other suggestions:

1. Don't believe in insider information and authoritative statements. I have never believed in conspiracy theories such as banker control. But you can search the following keywords, or ask others in the group, such as "I have read this document", "Buy anything below 7 coins", "Li Xiaoxiao", "3000 becomes history", and you will know that if you believe such remarks, you will end up losing money yourself. It cannot be said that these remarks are meant to harm others. People may sincerely believe what they say and really don't create traps to harm others. But there are many listeners, and the harm will naturally occur. If you want to listen to such remarks, then it is really you who creates the pit and jumps into it.

2. Control your operating positions and be sure to consider clearly what you will do after losing all your money before opening a position.

3. After losing money, don’t curse the streets. Before you have evidence, don’t curse the exchange, the government, or the big V. Unless you have collected evidence, you can take them to court.

4. Record your own operations, analyze and learn from experience, and be your own banker. (My experience is that no matter how I operate, the methods in the textbooks will make me lose money. Damn it.)

5. Don’t participate in crowdfunding. It is far more dangerous to entrust others to operate the currency than to operate it yourself.

In addition to speculation, Bitcoin has another way to increase its value, which is financial management. Now there are a large number of financial management projects in the Chinese market, such as haobtc, bitbank, and coin-born...

I don’t know how to look at this. On the one hand, I think that controlling the private key in your own hands is the best way to survive longer in the Bitcoin world. On the other hand, seeing that there is a little interest, it really makes me feel greedy. Thirdly, running away in the Bitcoin world is as frequent as running for exercise for modern people.

As for me, I store most of my coins offline. I lend a small amount of coins to people I think are reliable to earn some interest. This is a move that is inconsistent with what I know and what I do. My position is too heavy. When I pay off my debts, I will store all my coins in cold storage. The troubles caused by inconsistent knowledge and action are really sleepless.

However, at the end of this chapter, I still want to emphasize that staying away from cryptocurrency speculation and financial management is the best way for you to survive longer in the Bitcoin world.

Chapter 5 Crowdfunding

In the Bitcoin world, crowdfunding is plentiful.

There is a prerequisite that if you really want to distinguish the reliability of a project, the judgment accuracy is really low and will not be higher than tossing a coin.

It’s not a good idea to judge people by their appearance. For example, BBQ Cat was very popular and even Li Xiaolai claimed that it was awesome, but the company ended up running away.

It is not enough to just look at the technology. For example, the BTS white paper really got me excited. The advanced technology is really representative of the three tables. Anyway, I am still stuck with BTS. (However, I am not the initial investor of BTS. I bought PTS and BTS later. The initial shareholders of BTS are making money now, judging from the price of the currency, regardless of the market depth.)

Are they reliable and have great technology? I don’t know. I don’t know many people who crowdfund in the cryptocurrency circle, and I haven’t read many white papers.

Another premise is that most people really don’t have the time and energy to analyze the crowdfunding team and white paper.

Another premise is that breaking through the frontiers of the known world and bringing more wealth to the world is really the ability of the best of these crowdfunding. They really have people who can bring you multiple profits.

So I have two suggestions for most people:

1. Stay away from crowdfunding and be a stingy person. Don't invest in anything and don't care about your nonsense.

2. Invest all, and invest the minimum amount in every project within your reach. If you are lucky, you will make a profit, but if you are unlucky, it will be a sentiment.

Of course, for experts, or people who have the time and energy to identify white papers, or have a good relationship with crowdfunding teams, please ignore my advice. In fact, what I write is of no use to you.

I am a stingy person and have not invested in any original stock. Actually, I really want to invest in some projects, but I really don’t have time to identify the authenticity.

Staying away from crowdfunding is a good way to ensure that your Bitcoin does not decrease.

Chapter 6 Altcoins

There are even more altcoins.

The three premises of Chapter 5 also exist in this chapter.

But my suggestion is that for most people, you should stay away from altcoins. It is better not to take the risk than to take the profit. Otherwise, if you lose too much, you will doubt Bitcoin.

Personally, I often hold altcoins out of curiosity, for example, I hold a little Dogecoin and a few Litecoins. But curiosity can trap a cat, and I was trapped.

Staying away from altcoins is a good way to survive longer in the Bitcoin world.