The cryptocurrency market is a place where people’s lives can be changed in an instant if you choose the right project at the right time. We have all heard the stories of how lucky individuals have invested just a few hundred dollars, only to see it balloon into a fortune.
“That could have been us. That should have been us!”
We all begin to have these same thoughts. Unknowingly to most, these are the types of ideas that will be the downfall for most people in Bitcoin and crypto. You won’t have true success in this market until you learn what I’m about to share with you today.
Arguably one of the most deadly mistakes you can make in this industry is trying to chase gains.
The crypto market is full of people attempting to get rich as soon as possible, and this lack of patience will cause them to succumb to impulse decisions.
One such example is chasing after the crypto project that is currently the most hyped. People see these project's prices soaring while the coins that they already own are stagnant. Eventually missing out on these gains and the project that everyone is talking about will be too much for them to take. They finally give in and trade the coin they’ve been holding for ages for the new and shiny project.
A recent example of this was Solana toward the end of last year. No matter where you went on YouTube or X, Solana was all anyone was talking about.
Going further back to the last bull cycle; the hype was centered around Layer 1s and meme coins. Projects such as Solana, Luna, Avalanche, Shiba Inu, and Dogecoin were some of the most chased-after projects.
However, the age-old problem in the investing world is that once the entire market has gone into a frenzy mode about a certain project. Declaring that it's the next big thing, and the price will only continue to go up in the future. That is exactly when we have reached the short-term top.
Once you have become aware of the pump, you have already missed it.
This is a mistake that I learned the hard way during my early years in the cryptocurrency market. At the time it seemed like torture sitting on the sideline with coins in my portfolio that were moving at a turtle’s pace, while people were getting rich with other projects. Eventually, I succumbed to the peer pressure and converted significant portions of my portfolio into that project.
However, as I mentioned before. Once the entire market is aware of the pump, it has already ended. The price of the new project that I had bought immediately came to a halt, and would soon begin to drop with the weight of an elephant.
But what happened next was even more painful.
The rest of the market, including the project that I had just given away, came back with a vengeance.
I had devoted a significant amount of time researching that original project and had built a strong belief that it had incredible potential. Only for that conviction to be shaken when I saw other people making money.
You can only be invested in so many crypto projects.
The Warren Buffet quote above is referring to the stock market. I believe it directly relates to Bitcoin and cryptocurrency as well.
If you try to be invested in every project that goes parabolic. You will end up diluting your portfolio. There are far too many crypto projects that it has become impossible to be up-to-date on all of them. Let alone having enough capital to invest in all of them.
Instead, it is smarter to optimize your portfolio.
Put in the research and find the projects that not only have the potential to perform great during the bull cycle but more importantly will be around for the long term.
That is why I choose to invest heavily in the blue chips of the market, with Bitcoin making up a lion’s share of my portfolio. While I might be giving up larger gains in the short term. Overall, I will be more successful in the long term.
Don’t chase gains. If you have invested wisely, eventually your coin will have its day in the sun. Once you have the willpower to remain patient and maintain your crypto portfolio. That is when you are finally ready to “make it” in crypto.
How about you? Have you lost trying to chase gains?
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As always, thank you for reading!
