If you haven?t recognized it yet, let me tell you that the cryptocurrency market is extremely hot right now. This makes it even more important to stay cool when you trade.
You need to make sure that you don?t trade like a Degen. Instead, trade like a Pro. ??
The Degen Trader
First of all, let me tell you about Degen Trading. Recently, I stumbled upon the term "Degen" in the CoinGecko Glossary for Cryptocurrency. There are a lot of funny and unique terms in the cryptocurrency space like FOMO or HODL. If you are not familiar with one of these terms, make sure to check the CoinGecko glossary for cryptocurrency terms and you will find the right explanation.
I have to admit that I had a really good laugh when reading the explanation of "Degen". Until then, I didn?t even know that such a term exists.
"Shorthand for Degenerate. Degen trading or Degen mode is when a trader does trading without due diligence and research, aping into signals and FOMO into pumps. A Degen Trader does not know about metrics like FDV or TVL nor do they care.
They will buy because the asset logo looks cute, or because the slogan is memeable, or because some twit-famous anime girl on the internet says she's looking into crypto and the first two shill comments get more likes than others.
Essentially, a degen trader buys into an asset not because they see value, rather they do so with the belief that others will join in after them and speculate on the price swings."
This is such an awesome explanation of the term "Degen" that I haven?t much more to add.
Honestly, no one wants to be a Degen trader because if you trade like a Degen, you will lose a lot of money quickly. Instead, what you want to become is a professional trader making money, not losing money.
The Pro Trader
Now the professional trader is basically the complete opposite of the Degen Trader. Unlike the Degen, the Pro trader really understands his investments, he has a strategy, he takes responsibility for his investments, he does his own research, he stays cool and doesn?t FOMO, and he never gets greedy.
1. Understand Your Investment
The first thing that you need to make different to the Degen is this: You should only invest in stuff that you really understand. Hoping to make quick money, while not understanding cryptocurrencies at all is actually a really bad idea! That?s the Degen style. So please, before you invest bigger sums in cryptocurrencies like all your life savings, learn as much as possible about them.
This may sound quite simple but nevertheless, it`s essential when it comes to investing in cryptocurrencies.
It`s a common mistake that people invest their money in stuff that they don`t understand while hoping they can get rich quickly. These people are Degen investors. Only A degen trader invests his hard-earned money in stuff that he doesn?t understand. You as a professional trader, you do understand your investments well and you also keep yourself up to date on recent developments.
2. Have A Strategy
The Degen just trades without any kind of strategy. The professional trader on the other hand always has a trading strategy. He has this strategy even before he starts trading and investing.
Basically, you can have a long-term strategy or a short-term strategy. Long-term is months and years while short-term means some days or weeks. Furthermore, your strategy should contain an exit strategy. You should know when you want to collect your gains.
So when is the best time to sell your altcoins and collect the gains? I already wrote a post trying to answer this strategically important question. In case you?ve missed it, you can still check it out here.
3. Take Responsibility And Do Your Own Research
The professional trader knows that in the end, he alone is responsible for his own investment decisions and no one else.
You as a professional should always be able to live with the choices that you?ve made in the past and you should never blame anyone else for your financial losses, such as some bank advisor or some Twitter shills. You should make the decision on your own because you really completely understood the product that you want to invest in.
That`s why it is so important that you always do your own research ("DYOR"). Doing your own research actually means reading a lot! You need to have as much information as possible from different resources and not only from Twitter or Telegram shillers. If you have done this, then you have finished doing your own research.
Nevertheless, it is very likely that you will also make wrong decisions when investing. Then it`s important that you take the responsibility for your decisions and that you learn from your mistakes in order to make profits from your learning experience in the future.
4. Stay Cool And Don`t FOMO
The Degen trader is a very emotional guy aping into signals and FOMOing into pump and dumps. The Pro always stays cool when investing in crypto, and he doesn`t FOMO! FOMO is another important term in crypto space and means “Fear Of Missing Out.” This feeling is especially prevalent when a cryptocurrency rises in its value significantly over a relatively short time. It can be described as a feeling of anxiety that other people are getting rich while you are missing out. That?s the point where the Degen can?t help himself and he FOMOs in.
The problem with FOMO is that your investment decisions are based upon pure emotion instead of logic and reasoning. It can often lead to a situation where trades are made for an asset that is totally overpriced, incurring much greater risks of financial losses.
When a cryptocurrency rises in its value significantly over a relatively short period of time then you are already too late. FOMOing in is dangerous.
5. Don`t Get Greedy
Another very important thing is that you never should get greedy like a Degen. The most important reason is this: When you get greedy, you will get scammed more easily. It is important to understand that greed is the first ingredient for every successful scam. When you get greedy, you also lose your coolness. When you lose your coolness, you are guided by your emotions and not by a rational mind anymore. That?s the Degen mode.
This means that whenever you get greedy, you are going to put yourself in danger to get scammed or raked. This can happen much faster than you may think. The cryptocurrency industry is still relatively new and growing. Therefore, also the number of scams is increasing. Meanwhile, we have seen thousands of different scams over the past years, from very complex operations to extremely simple ones.
If you lose all your crypto because you got scammed, then it is really hard to recover from such a serious loss.
My Final Conclusion
After reading my post, please promise me that you will never ape into the next pump and dump "because some twit-famous anime girl on the internet says she's looking into crypto and the first two shill comments get more likes than others". ??
I hope that I could provide you with some useful information and that reading my post is somehow valuable for you. The intention of my post is just to help you to avoid the Degen mode and to become a professional trader instead. This post really reflects my own opinion and there are no referral links attached.
If that`s the kind of stuff that you like to read on Publish0x, make sure to hit that follow button at the bottom of this post. Thank you guys as always for reading, liking, following, and tipping ?? See you next time.
If you like, you can also follow me on Twitter.
You may also like: Sell The News And Buy The Dip ?? Cryptonator`s Ultimate Crypto Investment Guide
