Time Wasted in the Crypto Market

By johnwege | johnwege | 15 Jun 2024


There is a common idea that time in the crypto market is much more important than trying to time the market. The truth is that there are only a few select days throughout the year when most of the gains take place. Just missing those few days, could mean the difference between being incredibly successful in this market, or barely scraping by. By taking your time, dollar-cost-averaging, and continuing to grow your portfolio you will be more successful than most people in this market. 

Finally getting ahead in this market and building wealth that lasts can take years. In the crypto market, there is a popular belief that during your first full cycle, you can see great gains. During your second cycle, you can become rich, and during your third cycle, you can build wealth that lasts for generations. This is why most people enter the cryptocurrency market. 

However, there is something that most people won’t tell you as you are entering the market. That all of your wealth in this market can be lost in an instant. All it takes is one wrong or impulsive decision, and it can result in you seeing your portfolio and all of your hard work disappear in a second. Let me tell you from experience, there is nothing more painful than watching that happen. Years of grinding to save your extra cash. Researching and deciding what projects to invest in. Years of your life going done the drain. The pain and butterflies that you will be feeling in your stomach is a feeling that I would never wish upon anyone.

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One of the most common mistakes I have seen people make in this market is becoming too greedy. When they get overcome by FOMO or greed, they begin making impulsive decisions that aren’t very smart. One of these mistakes is taking on too much leverage. Most often by using their crypto as collateral to get a loan to buy even more crypto. Or going into debt by using credit cards to buy crypto. This market is incredibly volatile and punishing. If you take out a loan for $20,000 and the price of Bitcoin drops to $10,000. You will still owe $20k, but now your collateral’s value has dropped in half. In this situation, you will have needed to add even more collateral, or you would have been liquidated. It is an easy way to lose your crypto. More often than not, people would have been much better off just continuing to dollar-cost-average into Bitcoin.

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While Bitcoin and Ethereum are the cryptocurrencies that I am the most passionate about, that doesn’t mean I don’t see the merit of altcoins that are attempting to build something ambitious. With that said, another problem I have seen over the years is people getting bored with either of these two blue chips and venturing too far into the altcoin forest. Getting distracted by low-cap projects that could potentially bring them 100x gains. The problem is that over the history of cryptocurrency, most coins trended to zero when compared to Bitcoin. In fact, more than 90% of projects after initially making an all-time high in their BTC ratio, never match it again. This even includes Ethereum. While Bitcoin might be a slower gainer when compared to altcoin, the important thing is that it maintains its value much better. Just stack SATS and chill. 

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The final way I have seen people lose their wealth in crypto lose overnight is by trading with leverage. They see their favorite YouTuber or crypto influencer boast about how they made incredible gains by trading and few that they can do it to. However, the trade goes against them and they get liquidated. With leveraged trading, 9 times out of 10, the casino or in this case the exchange always wins. We must admit that we just either don’t have trading skills or aren’t lucky. The crypto market is ruthless. It will chew you up and spit you out without warning. 

The people who have become wealthy from investing know all too well that the best way to grow wealth is by doing it slowly and can sometimes even be boring. Building wealth that will last for generations. While dollar-cost-averaging into your crypto positions and taking advantage of deep discount days doesn’t sound sexy. It truly is the best way to not only become successful in the cryptocurrency market but survive. Always remember that you need to be at the top of your game at all times. It only takes one wrong decision in this market to lose everything. With the crypto market being extremely liquid and being open 24/7/365, it opens you up to even more risk of succumbing to your emotions or impulsive decisions.

How about you? What impulsive mistakes have you made in the crypto market?

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