7 Cryptocurrency Tips to Help You Succeed in the Next Bull Market

7 Essential Cryptocurrency Tips for Thriving in the Upcoming Bull Market

Author: The DeFi Investor, DeFi Researcher
Translation: Shanon Oppa, LianGuai

In the first few months of my foray into cryptocurrency, my investment portfolio performed poorly. There were several reasons for this, such as my lack of understanding of how this market works. After some time, I managed to start making profits.

However, the mistakes I made in the beginning cost me a lot of money. Especially if you are a beginner, you don’t have to repeat the mistakes I made.

Here are 7 cryptocurrency tips that can help you succeed in the next bull market cycle:

• Binance’s fund outflows lower than expected, new CEO vows to be stronger than ever before.
• Cristiano Ronaldo is sued for promoting Binance
• US Judge approves $1.65 billion settlement agreement between Voyager Digital and FTC

Bet less, focus on key projects

Many people are obsessed with diversifying their investments. Diversification is good, but it is for preserving value, not for creating wealth. In fact, knowing that your investments are spread across 15-20 projects, even if one of them fails, it will not have a significant impact on your investment portfolio, making it easier to sleep at night.

But it is very difficult to create wealth this way.

Instead, if you like 25 projects, then just make high bets on the top 6-7 projects you believe have the most potential. Managing 6-7 projects effectively is much easier than managing 25.

Don’t rush to sell

This is one of the biggest mistakes many people make.

If you see one of your tokens skyrocketing in price while another is underperforming, selling the best-performing token and increasing your holdings in the underperforming one is never a good idea.

Let your tokens continue to soar! Things will get even crazier in the next bull market.

There’s nothing more painful than selling a token after it has doubled in price and then seeing it multiply by ten in the following months.

When should you sell? When the price reaches your expectations or when your non-crypto friends start calling you to ask which token they should buy.

In a bull market, market sentiment > fundamentals

Market sentiment refers to factors that can quickly drive token prices up, but have nothing to do with fundamentals. XRP reached a market capitalization of $80 billion in the last bull market cycle. This would not have been possible without its highly active and enthusiastic community. There are many other tokens that have achieved extremely high valuations due to their strong market sentiment.

I believe that fundamentals will eventually become the main driving factor for prices, but in my opinion, we are still far from that point.

Therefore, instead of simply focusing on finding projects with the strongest fundamentals, try to understand what factors are driving retail investors to buy a particular token.

In a bear market, these things are most important:

• Fundamentals

• Revenue generation

• Product-market fit

But in a bull market, market sentiment becomes very important:

• KOL (Key Opinion Leaders)

• Storytelling through social media hype

• Market fit

• Strong marketing

I previously shared some thoughts on market sentiment in this post:

Record your investment philosophy

Writing down your arguments for an investment is very helpful. It helps you better understand your investment and identify gaps in your knowledge. Additionally, when you force yourself to write down your arguments before buying tokens, it becomes easier to avoid FOMO (Fear of Missing Out) based investments.

Review your investment portfolio every two months or monthly

Unless you’re buying Bitcoin or Ethereum, buying and forgetting is a terrible strategy. The crypto space evolves rapidly, and most projects become irrelevant within less than 2 years of launch. That’s why I recommend reviewing them on a regular basis.

When reviewing the portfolio, some of the things I check include:

• Recent progress by the team

• On-chain metrics (revenue, fees, TVL, etc.)

• Strength of the community (is anyone talking about the project?)

• Roadmap (what’s next for the project you’ve bet on?)

As George Soros said, “It’s not whether you’re right or wrong, but how much money you make when you’re right and how much you lose when you’re wrong.”

The only way to minimize losses is to cut your losing projects early when the fundamentals change.

Remain open to new ideas and perspectives

One way to increase your chances of success is to invest in the unpopular, misunderstood projects before everyone starts talking about them.

Saying “that will never work” without researching may be the most costly mistake you make in a bull market. Trying new things constantly can bring significant returns.

In addition, by doing so, you may also get some airdrops.

Furthermore, if you can’t change your biases when important new information arises, you’re more like a member of the project community than a true investor.

Great traders are not laughed at when they say “my analysis was wrong, I messed up.”

Develop an exit strategy

The people who didn’t make a profit in the previous bull market all swear they won’t miss the next one, but the frenzy of the bull market can lead to wrong judgments.

At the peak of every bull market, 90% of influencers say that we will continue to rise, that we have just begun. Selling humiliation becomes commonplace, while those who make a profit are called fools.

That’s why you need to formulate an exit strategy and ensure that you stick to it. Selling is not easy, and you might not sell at the highest point. But at least you can ensure that you have locked in some profits instead of having nothing in a cruel bear market.

A good exit strategy should include the following two points:

· When to take profits

· When to stop losses

Here is a good plan on how to formulate an exit plan:

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That’s all for today’s content.

All in all, the best thing I recommend is to invest/trade based on a strategy and a set of rules you have developed from your previous market experiences.

As the saying goes, “A trader without a set of rules based on an advantageous system is a gambler.”

Building wealth is very difficult, while losing it is easy.

That’s why you need a clear strategy.

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